Floor Covering Weekly February 11, 2013 : Page 1
Vol. 62 No. 3 A Hearst Business Publication February 11, 2013 $4 Mohawk’s Mike Zoellner Elise Demboski and with a retro Marilyn Monroe Ron Nash of Laticrete P OST with SpectraLock SURFACES The gates open at Surfaces 2013. ar t theme of Max” booth Magic “The Max Windsor at the 2013 brand. Drumline makes noise about Stainmaster *Surfaces coverage begins on page 4 Shaw’s Insight 2013: Armstrong: NFA’s first Building a better future wood group buy option said Ian Newton, Flooring 101, who put the program together for the group. [O] Shaw Flooring Network conven-[L V] e National “However, we see this as a tion — Insight 2013 — put a spotlight on the Floorcovering Alliance margin enhancement oppor-company’s ability to create targeted, laser sharp (NFA), a collective of more tunity,” Newton added, not business plans while expressing its deep con-than 40 of the nation’s as a market disrupter. He cern for its dealers, their families and the causes largest retailers, met prior also said that if the program it believes in. to Surfaces 2013 for a mid-gets good support, the group Vance Bell told the crowd of more than convention meeting and would pursue additions. 1,000 dealers (some 3,800 attendees), “Shaw vendor review. e positive Phil Kouﬁ dakis, incom-has put the pieces together to insure future momentum reported at last ing NFA president, said that growth and success. We have been focused fall’s meeting continues. the Armstrong program was on you. Our product quality and service And while the group dis-especially signiﬁ cant because have improved and we’ve made major capital cussed some potential pro-it represented the ﬁ rst group investments — over $1 billion. e time is Continued on page 12 grams behind closed doors, NFA members examine a new one it is publicly embracing wood program from Armstrong. buy outside of carpet. Kouﬁ dakis oﬃ ciated his is a new wood group buy ﬁ rst meeting as the new president. “My job opportunity from Armstrong. American Scrape Hardwood, introduced to with leadership is to bring the best oppor-the NFA at the fall convention, is a collection tunities to the group,” he told FCW during of high-end scraped products available in 3/8 the vendor meeting. “ en they can choose and ½-inch thicknesses. Available in 10 colors individually what is best for them. So far, we total, the NFA program is starting with four: have had success in getting mass participa-Eagles Nest, Autumn Blaze, Amber Grain and tion in carpet,” Kouﬁ dakis said, adding that Smokehouse. e program is a direct-ship he believed the group can spread that success into hardwood and beyond. His goal as presi-that oﬀ ers members competitive pricing. For breaking news updated each business day, visit us online at www.fcw1.com “ e price advantage is considerable,” Continued on page 7 By Mallory Cruise and Amy Joyce Rush right for you to invest in your business.” Both Bell and president Randy Merritt said that 2013 will deﬁ nitively be a better year. “It starts right here for all of us,” oﬀ ered Bell. “Your growth and success is our number one priority.” Explained Merritt, “Every year in January, everybody says it’s going to be a better year but we didn’t have the statistics to support that intention. is year we have concrete informa-tion to support it. It’s going to be progressively better for the next three to four years.” Warren Buﬀ et, chairman and CEO of Shaw’s parent company Berkshire Hatha-By Kimberly Gavin P e r i o d i c a l
Shaw’s Insight 2013: Building a better future
Mallory Cruise & Amy Joyce Rush
[ORLANDO] Shaw Flooring Network convention — Insight 2013 — put a spotlight on the company’s ability to create targeted, laser sharp business plans while expressing its deep concern for its dealers, their families and the causes it believes in.
Vance Bell told the crowd of more than 1,000 dealers (some 3,800 attendees), “Shaw has put the pieces together to insure future growth and success. We have been focused on you. Our product quality and service have improved and we’ve made major capital investments — over $1 billion. The time is right for you to invest in your business.”
Both Bell and president Randy Merritt said that 2013 will definitively be a better year. “It starts right here for all of us,” offered Bell. “Your growth and success is our number one priority.”
Explained Merritt, “Every year in January, everybody says it’s going to be a better year but we didn’t have the statistics to support that intention. This year we have concrete information to support it. It’s going to be progressively better for the next three to four years.”
Warren Buffet, chairman and CEO of Shaw’s parent company Berkshire Hatha-way, delivered a message as well. “The beauty of America is we grow. Flooring is a part of the American scene and was affected as much, if not more, than any other industry. We will have a recovery that is real and sustained — the shenanigans in Washington won’t have a negative effect on housing,” assured Buffet.
Late in 2011, Shaw changed its mission statement to fully reflect company goals and culture. “Shaw’s vision is to create a better future — for our customer, our people, our company and our communities,” stated Merritt. “We want to help our customer be prepared. The upturn requires a different strategy than survival.”
Programs at Insight 2013 resonated with the attending dealers. Caress, the new soft Anso nylon carpet, for example, was a clear hit. “It’s an awesome product and it will do well with the consumer,” said Lisa Jones, president of Business Direct Marketing in Tyler, Texas. She attended convention with husband Jerry Jones of Home Plus Floors, an NFA member.
Steve Boardman of MMM Carpets in Santa Clara, Calif., was one of eight SFN dealers that participated in the Total Business Transformation (TBT) program designed to help Shaw dealers grow. Its four essential initiatives are: Understanding your market and customer expectations; creating a vision and plan; putting tools offered by the company into action; and, measuring success with the Financial Benchmark tool.
Boardman said that the Financial Benchmarking tool insured that the store was doing things right. “The coaching — how to advertise, who the customers are, networking with other dealers. The best part for me was meeting Shaw’s upper management team. That’s the difference. They have a personal concern for us to succeed and prosper.” Ian Newton of Flooring 101 in Oxnard, Calif., noted, “Shaw is good at making product and backing it up with service.”
Tools for success
“The mission of Shaw Flooring Network is to help provide tools and business knowledge we know they need in ways that are easy for them,” said Merritt. “We have a lot of merchandising, marketing and advertising — critical parts of managing in the upturn.” Kathy Young, director of marketing, said Shaw is on all the paths the consumer is on with focused and targeted efforts. “It’s about creating preference. I want them to really know who Shaw is and sharpen the tools to reach her,” said Young.
The company is an avid user of social media. And in 2013, Shaw will sponsor the inaugural HGTV Smart Home (it has sponsored the HGTV Green Home in previous years) as well as the House Beautiful Kitchen of the Year and Southern Living Idea House. “[Shaw] values how they approach their dealer relationships — we’re not just customers, they look at us as partners. And, their whole social media approach and their realization of how invaluable it us to us as dealers. They offer us the technical assistance for increasing our social media presence,” explained Greg Besteman of Advanced Interiors in Jenison, Mich.
All of the company’s efforts are further supported by Shaw Web Studio, Shaw Ad Studio and Shaw Consumer Connect and Smart Targeting designed to give stores demographic information and shopping tendencies of the customers near them.
Caress, Shaw’s new soft nylon carpet with Anso, is both“comprehensive and balanced,” according to Mike Sanderson, product marketing manager. It has 27 styles, 50 colors, is Cradle to Cradle certified and features the R2X patented stain and soil resistance.
A robust Shaw Living area rug offering included more than 200 new designs — five handmade collections and indoor/outdoor rugs in 16 different designs including a hand hooked rug.
Tuftex has 19 new products including Bling, a 65 ounce nylon with a polyester accent for luster. The Tuftex sales force will now also carry the Shaw Living line.
Scott Sandlin, vice president of hard surface, is excited about Shaw’s hard surface product line-up, noting that Shaw gave the division “everything we’ve asked for including capital, people and added logistics.”
All hardwood flooring is Cradle to Cradle Silver Certified. “We created a brand new subcategory of hardwood with Epic,” said Kevin Thompson, hardwood and laminate category manager. Shaw’s Epic Hardwood is also Greenguard Children & Schools Certified. Two new Epic products were launched at convention.
The company is also working hard to enhance its laminate line, according to Thompson. “We’ve brought a significant amount of excitement back to laminate,” he said.
New resilient products include additions to the Array resilient collection which features a direct glue installation and a good, better, best or superior structure. Resort Tile has been expanded while Sumter LS has been upgraded and renamed to Sumter Plus.
“This is our third year in resilient. It’s an exciting time to get in — so many changes,” said Clark Hodgkins, resilient category manager.
Tile & Stone
Shaw is introducing 165 SKUs of tile and stone in 2013, according to Vance Hunsucker, tile and stone sales manager at Shaw, that include natural stone and travertines. Porcelain and ceramic introductions feature Clarity Digital Imaging Technology, allowing for realistic designs.
The Anderson brand combines the strength of Shaw with a name that is synonymous with American-made, quality hardwood floors. Completely separate from Shaw, Anderson is offering a number of new streamlined collections of its own.
While maintaining its signature high-end look in Bastille, Anderson brought out a number of value-oriented products that will give the company “velocity,” according to vice president of national accounts Rick Knowles.
Urban Loft , for example, is an engineered product that appeals to consumer preferences for wide planks and long boards. Urban Loft is an Epic produced product.
“We wanted the collection to be streamlined but also impactful. It is a great looking, domestically produced product,” Knowles said. Anderson also has robust marketing efforts surrounding the new product.
Jason Emmert of Advanced Interiors in Jenison, Mich., predicted, “Urban Loft will do well, customers love anything Epic. And, it is well designed at an affordable price point.”
Ready for market demands
Merritt said that in order to grow, a company needs to have the working capital to prepare itself and Shaw, he added, is prepared.
“We pride ourselves on being able to be flexible and to change,” Merritt said.
Proof, he said, is the company’s investment in changing from nylon staple to nylon filament. “In 2006, we were probably 50 percent of the industry’s capacity in nylon staple and that was our big stick. Today, there is virtually no staple left in the industry and we had to change in a hurry. We had to prepare to service this growing filament polyester market, the nylon filament market. We invested a billion dollars in the last six years. A lot of that was to improve our service and provide the customer with what the customer wants.”
Added Sandlin, “We are poised for the builder comeback in our capacities. And that’s a big deal. You better be ready. The builder community gives you one shot.”
Armstrong: NFA’s first wood group buy option
[LAS VEGAS] The National Floorcovering Alliance (NFA), a collective of more than 40 of the nation’s largest retailers, met prior to Surfaces 2013 for a mid-convention meeting and vendor review. The positive momentum reported at last fall’s meeting continues. And while the group discussed some potential programs behind closed doors, one it is publicly embracing is a new wood group buy opportunity from Armstrong.
American Scrape Hardwood, introduced to the NFA at the fall convention, is a collection of high-end scraped products available in 3/8 and ½-inch thicknesses. Available in 10 colors total, the NFA program is starting with four: Eagles Nest, Autumn Blaze, Amber Grain and Smokehouse. The program is a direct-ship that offers members competitive pricing.
“The price advantage is considerable,” said Ian Newton, Flooring 101, who put the program together for the group. “However, we see this as a margin enhancement opportunity,” Newton added, not as a market disrupter. He also said that if the program gets good support, the group would pursue additions.
Phil Koufidakis, incoming NFA president, said that the Armstrong program was especially significant because it represented the first group buy outside of carpet.
Koufidakis officiated his first meeting as the new president. “My job with leadership is to bring the best opportunities to the group,” he told FCW during the vendor meeting. “Then they can choose individually what is best for them. So far, we have had success in getting mass participation in carpet,” Koufidakis said, adding that he believed the group can spread that success into hardwood and beyond. His goal as president is to bring the group closer together, “members to members and vendors to members,” he said.
Koufidakis said that at the membership meeting last fall, every member in the room was ahead of the prior year. That momentum continues, according to reports given at this meeting. Furthermore, he believes that it will continue through 2013. “This year will be a big year for us.”
For his own company, Baker Bros. in Phoenix, business is as good as it’s been over the past four years, Koufidakis said. “Last year was up substantially. We were down in May, but up in double digits by year’s end,” he said. “From September 1 on, it was awesome.”
Other members also feel good about business and good about the position of the NFA. Sam Roberts, president, Roberts Carpets and Fine Floors, Houston, and a past NFA president, told FCW that his business was up 13 percent last year versus the year before. “But that’s coming off bad numbers,” he said. “If I can show a 10 percent increase for 2013 over 2012, I’ll feel good about the floor covering business.”
Roberts relishes his membership in the NFA. “This is not only the single best group, but it’s the best entity in this industry, period,” he said. And the group has naturally evolved from its early days, taking on more active buying and programming for the members. “Twenty years ago, we were a bunch of fiercely independent dealers. We are still fiercely independent, but we are better at communicating,” and collectively taking advantage of opportunities, Roberts said.
JeffMacco, CEO, Maccos’ Floorcovering, Madison, Wis., recently added a store in Naples, Fla., and is up to nine total stores. “We had a good year,” Macco said. “Sales were up double digits and expenses stayed the same. That made a dramatic increase in the bottom line.” Overall, Macco, who also has served as NFA president, said the NFA members are optimistic about what’s going on. “There are still some pockets that are slow around the country, but the group as a whole is as strong as it’s ever been.”
“Joining this group is the best move I ever made,” said George Coles, principal, Coles of San Diego. “It’s such a strong group. I think we don’t realize sometimes how powerful we really are. But it’s also nice to hear that the mills enjoy working with us.” Coles just opened its eighth store, a 3,500-squarefoot boutique in Jerome’s Furniture, a 100,000-square-foot store in the Chula Vista, Calif., area.
Other meeting news
Koufidakis called the meeting to order with the request that all the members visit the vendors. Internally known as the Tier 2 Vendor event, this meeting showcases the vendors who haven’t yet graduated to attending NFA conventions. Those spots are hard to get because of time. So this meeting gives members a chance to see these vendors one-on-one in a closed environment. “It’s important to visit them all,” Koufidakis said.
Incoming treasurer, Jason McSwain, McSwain Carpet and Floors, Cincinnati, reported that the group was in good financial shape with a positive balance sheet year over year. He also thanked outgoing treasurer, Tom Hadinger, Hadinger’s of Naples, Fla., for his six years of service in the position. “Thanks to Tom, it was a very smooth transition,” McSwain said.
Vendor committee chairs reported that the NFA produced strong increases in purchases with all key vendors. Many of the increases were in double digits, which reflects both on good business conditions as well as member support for key vendors, Koufidakis said.
The NFA welcomed a special guest at the meeting. Steve Pulsipher, former vice president of flooring for Utah-based R.C. Wiley, received a standing ovation from the members. In true form, Pulsipher — a shrewd buyer — raised his hand and asked for a “three-peat” buying opportunity on the Armstrong wood program, which brought another round of applause from members.
The NFA also hosted ICC Floors from Indianapolis as a prospective member. The group convenes April 3 to 7 for its annual spring meeting in Beaver Creek, Colo . The fall event is planned for September in Boston.