Floor Covering Weekly March 11, 2013 : Page 1
Vol. 62 No. 5 A Hearst Business Publication March 11, 2013 $4 Wood: Fall sales preview The Essentials of Stone 8 F LOOR C OVERING W EEKLY Will copyrights kill copycat visuals? By Raymond Pina Leading executives at Mohawk, Quick-Step, Armstrong and Mannington Mills said that they are now copyrighting unique and increasingly exclusive designs for laminate ooring. “You can’t patent a visual but you can copyright and trademark them. We have done both,” said Milton Goodwin, Arm-strong’s vice president of wood and lami-nate. “And yes, we have enforced them but we don’t discuss it for con dential reasons.” Why copyright? Suppliers said that they take these legal steps to fend o Chinese competitors that digitally scan, copy and then resell the designs back to the U.S. market in unbranded prod-uct — o en through the home center and other mass merchant channels. In 2010, Dan Natkin, director of wood and laminate at Mannington and vice president of residential styling Joe Amato hand-planed, scraped and stained 75 wood planks before digitally scanning and enhancing them — one of those became a best-selling laminate: Time Cra ed Maple. “ e next year at Domotex Asia, nearly 28 Autumn intros spice up product mix Alliance Flooring: Pillars for Success throughout the year to gather valuable infor-mation for its members. Dunn and his wife, Sandy, take an RV trip every summer trying [C, T.] Coming o to visit as many stores as possible. While on a successful 2012, Alliance Flooring co-those visits, Dunn mines his membership CEOs Ron Dunn and Jon Logue are equally for valuable ideas he can pass along. optimistic about 2013. e group gathers “ ey may not realize that something shortly in Orlando for the CarpetsPlus they are doing is that unique or that dif-Color Tile annual membership meeting ferent,” he explained. But some of the ideas and convention, and Dunn and Logue are are so unique and so successful, he adds anxious to share new product and oppor-Jon Logue and Ron Dunn, Co-CEO's of Alliance Flooring them to the list of things to pass along. tunities with members, they told FCW . e theme for this year’s convention “We were up 5 to 6 percent for the year,” Logue said. “ is year, so far, we are up for the “I’m hearing about record pro ts in Janu-came out of Dunn’s trip this past summer, he rst couple of months, and still getting num-ary from our stores,” Dunn added. “It’s nice to explained. He realized that the successful ideas bers in for February. ere is a good, positive nally hear that a er this prolonged recession.” were really pillars for success that his stores are using to survive. Drive has been the overarching attitude among members,” he said, driven by theme for the past few years. Alliance combined positive consumer con dence numbers and Pillars theme Continued on page 21 positive home building numbers. Alliance Flooring makes a real e ort By Kimberly Gavin Continued on page 8 Mannington’s Joe Amato handcrafts Time Crafted Maple, one of Mannington’s best selling and often copied laminates. White explained that because it’s human nature for retail sales associates (RSA) to reach for a product that is represented by someone who they have a relation-By Janet Herlihy ship with, the products from the rep who doesn’t visit are seldom sold. Called territory managers or manu-“A good rep is like family to me,” facturers reps, the men and women stressed White. “ ey come to our who call on retailers with products Christmas party.” from ooring suppliers are an essen-For White, the best reps are from tial link in the chain that connects Kardean, Shaw and Tu ex. “I work consumers with carpet, rugs, hard-directly with Kardean and they always wood, vinyl, laminate and ceramic call me back. e Shaw and Tu ex tile products. teams are amazing,” he stressed. Retailers have strong and mixed Reps Gary Pickney, Alan Bergstrom, Jay Polack, Jack Finkel A good manufacturers’ rep can feelings about the reps that call on and Mike Wanta are a pleasure to work with, according to make a huge di erence to a dealer’s them. “I have about 25 reps who are Michael Peters of CarpetsPlus in Wisconsin. business, according to Joan Cocuzzo, supposed to call on me,” said Barry White, owner, Carpeteria, Lancaster, Calif. call on. One who doesn’t come, said, ‘I was owner and manager of two Flooring Amer-“Of all of them, ve do their job really well, going to wait to get some business (from you) ica Design Center locations in the Boston area. “We have had reps who have revo-about 10 do a minimum job and 10 don’t before I came.’ ” come at all. ey say that we’re too far out to Continued on page 31 at rep will probably wait a long time. Value of a good rep — priceless P e r i o d i c a l 2013 WINNERS For breaking news updated each business day, visit us online at www.fcw1.com Congratulations to the 2013 Dealers’ Choice Winners (See page 6)
Will copyrights kill copycat visuals?
<br /> Leading executives at Mohawk, Quick- Step, Armstrong and Mannington Mills said that they are now copyrighting unique and increasingly exclusive designs for laminate flooring.<br /> <br /> “You can’t patent a visual but you can copyright and trademark them. We have done both,” said Milton Goodwin, Armstrong’s vice president of wood and laminate. “And yes, we have enforced them but we don’t discuss it for confidential reasons.”<br /> <br /> Why copyright?<br /> Suppliers said that they take these legal steps to fend off Chinese competitors that digitally scan, copy and then resell the designs back to the U.S. market in unbranded product — often through the home center and other mass merchant channels.<br /> <br /> In 2010, Dan Natkin, director of wood and laminate at Mannington and vice president of residential styling Joe Amato hand-planed, scraped and stained 75 wood planks before digitally scanning and enhancing them — one of those became a best-selling laminate: Time Crafted Maple.<br /> <br /> “The next year at Domotex Asia, nearly 80 percent of the laminate exhibitors were prominently displaying knockoffs of Time Crafted Maple,” said Natkin. “We don’t get to pick and choose which product will be a success. We do a lot of homework to get that one major success and these guys come in and pick off what’s already selling without doing any of the developing and marketing.”<br /> <br /> Are copyrights enforceable?<br /> Leading suppliers have successfully stopped the importation and sale of copyright- infringing product by issuing cease and desist orders. The would-be defendants have all settled out of court.<br /> <br /> Carpet visuals have long been protected by copyrights and, according to Mannington’s attorney Sherry Flax, partner at the mid-Atlantic law firm Saul Ewing, the same legality applies to laminate flooring.<br /> <br /> “These laminate floors are uniquely created designs that are worthy of protection as 2D pieces of visual art,” said Flax. “The design process includes a visual in someone’s mind and a team works to produce an ideal form you don’t find in nature.”<br /> <br /> However, unless the accused has manufactured exact replicas — not digitally altering a knot, cathedral or worm hole — it can be difficult and expensive to enforce décor copyrights.<br /> <br /> GTP International CEO Dave Reichwein has tried to enforce copyright laws protecting the handscraped designs of Córdoba laminate flooring in the U.S. and China.<br /> <br /> “In the end, the copyrighter says they created something unique inspired by nature. Then the infringer says by changing a knot or cathedral their product is unique and different, too. I don’t agree with it, because it makes everything a commodity,” he said.<br /> <br /> Manufacturers, importers and retailers of floors found to infringe upon copyrights can all be held liable, according to Flax. “They will be forced to pull the floors off the shelf and there’s a risk of going after past profits,” she said.<br /> <br /> For leading suppliers with the resources to develop and copyright cutting-edge designs, legal protection could potentially stabilize pricing and justify premiums.<br /> <br /> “Style and design is at the core of what we do,” said Natkin. “We create the newest and greatest looks and it’s not fair for someone to take them and sell them to Home Depot or Lumber Liquidators.”<br /> <br /> Mannington partners, who pay a premium for the mill’s award winning laminate designs, are vigilant about looking out for infringers, according to Pat Theis, vice president of sales and marketing, Herregan Distributors.<br /> <br /> “When Mannington takes action to protect their design property we feel it not only raises the value of their designs, but also reinforces their commitment to those dealers that have invested in their products,” said Theis.
Alliance Flooring: Pillars for Success
<br /> [CHATTANOOGA, TENN.] Coming off a successful 2012, Alliance Flooring co- CEOs Ron Dunn and Jon Logue are equally optimistic about 2013. The group gathers shortly in Orlando for the CarpetsPlus Color Tile annual membership meeting and convention, and Dunn and Logue are anxious to share new product and opportunities with members, they told FCW.<br /> <br /> “We were up 5 to 6 percent for the year,” Logue said. “This year, so far, we are up for the first couple of months, and still getting numbers in for February. There is a good, positive attitude among members,” he said, driven by positive consumer confidence numbers and positive home building numbers.<br /> <br /> “I’m hearing about record profits in January from our stores,” Dunn added. “It’s nice to finally hear that after this prolonged recession.”<br /> <br /> Pillars theme<br /> Alliance Flooring makes a real effort throughout the year to gather valuable information for its members. Dunn and his wife, Sandy, take an RV trip every summer trying to visit as many stores as possible. While on those visits, Dunn mines his membership for valuable ideas he can pass along.<br /> <br /> “They may not realize that something they are doing is that unique or that different,” he explained. But some of the ideas are so unique and so successful, he adds them to the list of things to pass along.<br /> <br /> The theme for this year’s convention came out of Dunn’s trip this past summer, he explained. He realized that the successful ideas were really pillars for success that his stores are using to survive. Drive has been the overarching theme for the past few years. Alliance combined the two into Drive: 2013 Pillars for Success<br /> <br /> As he traveled, he asked, “What would you say are the three to four things that make or break your business?” The answers were clear.<br /> <br /> The first P is People, Dunn said. “That was the number one answer.” So convention will focus on helping members build and develop people — from training and motivating, to inspiring and compensating. “And getting them to change with the times,” he added.<br /> <br /> Another idea that came out was Perception. It’s not always obvious, but a store’s perception in the market place is terribly important, Dunn and Logue said. At convention, they will talk about how to build proper perception in the market. What is your mission? What is your unique position and how do you maximize that?<br /> <br /> The third Pillar is planning. “During this elongated recession, it’s been so hard to plan,” Dunn said. “Lots of planning was done by gut. So we are bringing in a company, Afterburners, to help our members sharpen their planning skills.”<br /> <br /> The fourth Pillar is promotion. Dunn said, “We are asking members: ‘What’s your promotional calendar look like to drive business?’” Alliance will have tools to do that in 2013.<br /> <br /> Product focus<br /> On the product front, Logue said Alliance will focus on soft carpet. A True Soft launch last year did very well, so new offerings will come from Ultra Fresh Satin, Anso Caress from Shaw and Sorona Silk Elite Performance from Mohawk.<br /> <br /> “Soft , soft , soft — it fits right into our advertising and promotional plans,” Logue said.<br /> <br /> Last year’s promotional campaign with consumer credit did very well. Alliance members will also have access to a coupon tied to the Ultra Fresh Satin launch. Alliance is also offering some value-oriented products on the polyester side. The company has a Home Values display that has been successful in hard surface that it’s bringing to the carpet side, Logue said. “It’s our focal point for value.”<br /> <br /> Dunn added, “We’ve solidified relationships with distributors on the hard surface side. Our members will appreciate those opportunities.”<br /> <br /> Alliance is also bringing other opportunities for business deals through Team Alliance. “Our members are so busy. As business comes back, we can bring them added benefits from things they may not have time to look at, supplemental insurance, for example, or pay-per-click advertising.”<br /> <br /> Finally, Dunn said they want the membership to take home ideas they can use. Last year, Alliance put a book together called Pillars of Success, 50 ideas from the members. This convention, they can take home Pillars of Success 2 — even more ideas to drive business in today’s economy.<br /> <br /> Logue and Dunn expect the year to feature nice, steady growth in the 5 percent to 10 percent range. “Some of the building and builder business hasn’t kicked in yet,” Logue said. “But there are very strong forecasts.”<br /> <br /> “We’re looking at growth in size and sales,” Dunn added. “We have members who are expanding the number of stores.” It’s still a good time to buy property or negotiate new leases, he added.<br /> <br /> Growth ahead<br /> Dunn is not concerned that the growth rate is too fast for his members to absorb. “They are geared up to keep up with sales as they come back. While there is a positive feel, members are still cautious,” he said. The most common comment he hears is that his members could use some help. But they want to get farther into spring to make sure the economy isn’t going to dip back down — the way it has the past several years.<br /> <br /> “That’s wise,” Dunn said. “Our industry has a good work ethic. People are working harder, but I see high passion and energy. Too much business would be a high-class problem to have.”<br /> <br /> The slow, steady growth Dunn and Logue are predicting is good for the industry and the country. “It’s good for jobs, profits and energy,” Dunn said. “It’s sustainable.”<br /> <br /> That type of sustainable growth also means that Alliance Flooring is back in growth mode. “The past five years have been strategic,” Dunn added. “We’ve emerged as a stronger and better company, but we are back in growth mode both with our suppliers and distributors and by growing our membership.”
Value of a good rep — priceless
<br /> Called territory managers or manufacturers reps, the men and women who call on retailers with products from flooring suppliers are an essential link in the chain that connects consumers with carpet, rugs, hardwood, vinyl, laminate and ceramic tile products.<br /> <br /> Retailers have strong and mixed feelings about the reps that call on them. “I have about 25 reps who are supposed to call on me,” said Barry White, owner, Carpeteria, Lancaster, Calif. “Of all of them, five do their job really well, about 10 do a minimum job and 10 don’t come at all. They say that we’re too far out to call on. One who doesn’t come, said, ‘I was going to wait to get some business (from you) before I came.’ ”<br /> <br /> That rep will probably wait a long time. White explained that because it’s human nature for retail sales associates (RSA) to reach for a product that is represented by someone who they have a relationship with, the products from the rep who doesn’t visit are seldom sold.<br /> <br /> “A good rep is like family to me,” stressed White. “They come to our Christmas party.”<br /> <br /> For White, the best reps are from Kardean, Shaw and Tuftex. “I work directly with Kardean and they always call me back. The Shaw and Tuftex teams are amazing,” he stressed.<br /> <br /> A good manufacturers’ rep can make a huge difference to a dealer’s business, according to Joan Cocuzzo, owner and manager of two Flooring America Design Center locations in the Boston area. “We have had reps who have revo-lutionized our business,” Cocuzzo said. “About 15 years ago, a rep helped us get into hardwood and it helped us grow our business. That same rep is now helping us get into stone.”<br /> <br /> The differences between reps can be striking. “We’ve recently gotten a new rep for an area rug supplier,” Cocuzzo noted. “We hadn’t gotten an updated price list in three years. The new rep is helping and we’re already starting to sell the rugs.”<br /> <br /> Cocuzzo’s greatest complaint is unanswered phone calls. “When I call a rep, it’s because I need something right then. If the rep doesn’t answer and doesn’t call me back until hours or days later, the customer is gone and it’s usually too late,” she explained. “The rep who answers the phone can help us make a sale. We rely on them to explain the product and keep us up to date. Hardwood prices change constantly, so you have to be in touch with your rep. We don’t sell the bad rep’s goods because we don’t know enough about the product.”<br /> <br /> Manufacturers work to field effective reps<br /> Shaw tries to train its reps to be “good ones,” according to Chris Clement, director of sales training and development for Shaw. “It’s not just about product. It’s about learning to listen,” Clement stressed. Called “Surround the Account,” Shaw’s strategy aims to really understand the customers’ needs. Clement added, “We want to understand their business and help them become profitable.”<br /> <br /> Shaw’s training program varies according to what kind of experience a new rep brings to the job. For someone straight out of college, it’s a 14-week process that includes time in Dalton as well as field trips to call on retailers to understand retail dynamics. Territories vary by market and population density.<br /> <br /> After a rep is assigned a territory, training continues. “They are constantly reinforced with additional information, Clement explained. “They will have a different set of questions once they’ve been in the market for six months and again at 12 months.”<br /> <br /> Each rep runs his or her territory as a local business. “Our job is to serve the retailer. We need to be in the stores. There is always something going on,” Clement reported. “Our accounts have commercial and residential projects we can help with. The dealer will go with the people they trust. Product is an important component but it is not the only factor. The tiebreakers are support issues like returning calls and being on time. There are plenty of vendors, but dealers want someone to be a trusted advisor.”<br /> <br /> Shaw currently has about 800 reps on the residential side and 300 on the commercial side. They are likely to be specialized with some handling carpet and others covering all hard surface products.<br /> <br /> Mohawk’s Sales Academy focuses on retail training of reps that are called territory managers (TMs) for the residential market and account executives for the commercial side of the business, according to Mike Zoellner, vice president of marketing services.<br /> <br /> Mohawk gathers a group that could be as small as one or two and brings them to Dalton for the training. Totally new to the industry TMs go through an “on-boarding process” that includes human resources materials, all product knowledge and information on their customers. Zoellner said, “Training goes on for about a month but Mohawk puts people in the field as soon as possible.”<br /> <br /> Pre-recession, classes of 25 to 30 TMs were run quarterly, but because there was contraction of about 40 percent during the recession, there are now fewer accounts and so, fewer TMs, according to Zoellner. Mohawk TMs handle carpet and cushion or all types of hard flooring. “The number of dealers a TM calls on is determined by markets and miles, because there are areas where there are more Mohawk aligned dealers compared to others where there are fewer,” Zoellner noted.