In the race to compete in the hard surface arena—particularly LVT/P, SPC and WPC—it’s difficult to enter the game late, play catch-up and still establish a meaningful presence in such a highly contested market segment. Fortunately, there’s a more expedient vehicle to market for those manufacturers, distributors and retailers who don’t currently make their own lines: private-label programs.
In many cases, private-label manufacturers already have in place the provisions to not only make the product themselves but also source finished product from their network of vendors and third-party suppliers. In addition, many private-label manufacturers have arrangements with shippers to transport products efficiently, thereby lightening the load for clients.
Take Germany-based Classen, for example. The company operates several, state-of-the-art plants that can produce a variety of hard surface products (including rigid core and laminate flooring) for companies that then rebrand those products for their markets. This includes its Kaisersesch plant, a sprawling 860,000-square-foot-plus factory located in the western part of Germany. The plant is dedicated to the design and production of vinyl wall and floor coverings in both click and glue-down formats. Over in Baruth, in the eastern part of Germany, Classen produces high-quality, waterproof laminate flooring products in a 100% vertically integrated facility. The operation includes a production plant dedicated to the manufacture of both MDF and HDF—the core layer of laminate flooring’s structure. The facility also boasts state-of-the-art industrial digital printing capabilities, which enables greater customization for clients.
“We have 10 designers working in our factory in Kaisersesch, and they can create any designs for our customers with a good lead time,” Celine Quervel, Classen’s director of marketing, explained. “They can come to us and say they want this or that, and we can create custom looks using our digital printing.”
Classen’s custom capabilities don’t end there. Realizing that clients have different needs in terms of their own limitations and/or areas of focus, Classen seeks to make it easier for potential customers to facilitate a private-label program by offering flexible options with respect to core board materials. For example, a flooring manufacturer might have their own, proprietary digital printing capabilities but not the essential internal infrastructure to produce their own boards. Either way, Classen has it covered.
“If necessary we can just sell our plate or Ceramin boards without any décors or designs on it, and then the customer can put their own décor on it, profile it and then send it as their own product,” Quervel noted. “We’re already doing that it Europe, and we can also offer that service to manufacturers in the U.S.”
But what if the client produces their own coreboards but doesn’t have the expertise or capability to apply a design or wear layer to the product? No problem. Classen can handle that as well. “We are happy to finish the product in our production facilities and send it back to the client using their packaging,” Quervel explained.
Other major private-label suppliers include Nox Corp., with U.S. headquarters in Fostoria, Ohio, as well as operations around the globe. The company is known for its capabilities to service virtually any client interested in a bona fide LVT private-label program.
“Private-label programs provide a very easy way for large companies to enter into a particular product category,” said Dave Thoresen, senior vice president of product innovation and business development, Nox Corp. “Maybe they’re not ready to start manufacturing it, or maybe they don’t know if it’s going to be ultimately successful. Maybe they just want to test the water. Sourcing is a great way to start out. If you start out sourcing with someone who’s focused more on OEM, it really makes for a good partnership, because the OEM is looking to keep their plants full and obviously get a startup in different markets. It’s a great way to find out what can be successful.”
Another advantage of working with an OEM supplier, according to Thoresen, is that supplier has typically amassed years of expertise and knowledge of how to navigate the market. “If you look at large flooring companies that start sourcing products from OEM manufacturers, they know more about what colors will work, what price points will work, etc.,” he explained. “They have the connection to the market that [others who are less experienced] may not have because they don’t have all the salespeople.”
Another strategic and competitive advantage that Nox Corp. offers is a strong, domestic presence. Even prior to the pandemic—when disruptions in imported shipments of LVT/P wreaked havoc on the market—Nox Corp., was still able to provide consistent supply to the market.
“Having a U.S. plant really does allow for us to service two key parts of the market,” Thoresen noted. “No. 1, there is a group of people who want to see ‘Made in America’ out there. I love that type of business and I’m happy we’re able to service that every day. And the second part is domestic production provides benefits for people who have a short timeline. They can’t wait six, eight or 12 weeks to get a container in, but they can come to us and get it in 30 days or less. It makes for a much better and shorter lead time when you’ve got to have it. With a U.S. plant, you can be more flexible in how you set your timing. You’re ordering basically for a 30-day lead time as opposed to a 10-week lead time.”
Even companies that market their own stable of well-known brands see opportunities in the private-label market. “We do a ton of private-label business with distributors,” said Brian Carson, president & CEO of AHF Products, a company whose growing portfolio now includes 14 well-known brands. “Private-label offers us a way to not only segment products in the market, but also provide our distributor partners with the means to differentiate themselves with products that can’t be shopped in their local markets and territories.”
Distributors reap the benefits
If there’s any doubt that private-label programs offer tangible benefits to the distribution community, just ask some of the nation’s top flooring distributors. Take, for example, Tri-West, the industry’s No. 3-ranked wholesaler with $350 million projected 2023 revenues. The company utilizes private-label product across categories—mostly through its own proprietary brands.
“Private label allows us to pick specific colors, specifications and technologies—and we can really tailor the product toward our geography versus branded products that don’t necessarily fit what we need,” David White, vice president of sales and marketing, Tri-West, Ltd., told Floor Covering News. “We talk to factories weekly—if not a couple of times a week—trying to come up with the next best thing. We’re aggressively looking for that, and if we find it we just plug it into one of our private-label brands—rather than waiting for one of the national brands to try to come up with something.”
Ditto for Galleher, the No. 4-ranked distributor with $320 projected 2023 sales. The company has three primary private-label brands that are each designed to meet the needs of different customer segments: Monarch Plank, Reward Flooring and GemCore. “Each brand meets a unique need across the spectrum of residential and commercial customer segments, which allows us to focus our marketing messaging on those key relevant benefits that generate purchase interest,” said Jim Harrington, vice president, marketing and brand strategy. “Whether it’s a particular color, texture, finishing technique or price point, our proprietary brands are designed to deliver benefits that fulfill unmet consumer flooring needs.”
