Floor Covering Weekly February 25, 2013 : Page 1

Vol. 62 No. 4 A Hearst Business Publication February 25, 2013 $4 S URFACES Wood: Fall sales preview POST F LOOR C OVERING W EEKLY Beaulieu back in force By Janet Herlihy A er a year of reorganization, the Beaulieu Group is back with a full executive team, a new Bliss collection and a marketing plan to make its new Indulgence a winner in the so carpet sweepstakes, according to Beaulieu executives. Looking to leverage its strengths, Beaulieu has clearly de ned roles for its leadership, according to Ralph Boe, who continues as CEO of the company. Since last April, Karel Vercruyssen has served as president and COO of the Beaulieu Group as well as CEO and president of Beaulieu Canada. Vercruys-sen oversees all company operations, while Boe handles sales, marketing, distribution and customer service. e next Beaulieu generation is learn-ing the carpet business, according to Carl Bouckaert, a founder and owner of Beau-lieu, whose sons have joined the company. Nicolas Bouckaert is now president of the Beaulieu Commercial division and Stanley Bouckaert is heading up special projects. “ eir involvement is an indication of the family’s commitment to the business,” said Bouckaert, who is a Beaulieu board member. Autumn intros spice Coverage up product mix begins on page 4 2013 8 Phil Gutierrez’s 20,000 square-foot store in Naples features a vast assortment of area rugs including hand knotted one-of-a-kinds, silks as well as machine mades. Karel Vercruyssen and Ralph Boe Continued on page 22 Dealers optimistic about 2013 By Kimberly Gavin [L V] Dealer and distributor attitude was optimistic at Surfaces 2013 — as it has been for the past three years. e di erence this year is that they really believe things have turned the corner and better business is ahead. ere is also evidence that carpet is making a comeback. According to reports by Hanley Wood, Surfaces show organizers, attendance gures were approximately 4 percent up versus 2012. If more buyers were there, more importantly is that they were clearly optimistic about business in the coming year. Dealers are also shopping for new products — and the new so carpets had them scouring the hall to nd the most promising for what they hope is renewed interest among consumers. Keith Spano, president, Flooring Amer-ica, told FCW that he came o his group’s convention believing things were looking up. He remained convinced a er visiting Surfaces. “ e builder market continues to go in the right direction. It really all comes down to how good people feel. We have more of our members opening new branches. at’s good,” Spano said. Nick Freadreacea, president/owner, e Flooring Gallery, Louisville, Ken., o ered, “We’ve had our best year in years. Everyone I’ve talked to has had the busiest January they can remember. Consumers are ready to get out. Our retail stores are crazy.” Even on the builder side, Freadreacea said, things are going very well. He is getting ready to remodel his stores to better re ect his business — one of the reasons he was at the show. “My sales are half carpet, but my Building from a strong base Abbey’s private branding, custom advertising, help members compete By Amy Joyce Rush supplier’ to where now we spend probably 80 percent of our e ort on the marketing part rather than the buying part,” he said. Gutierrez’s own store here in Naples — a 20,000 square foot space with an additional 6,000 square foot tile and stone store across the parking lot — exem-pli es the franchise’s strengths and is a per-fect example of what an Abbey store can be. Here, the dedication is in the details: displays Phil Gutierrez are uniform and nearly every product is exclusive to Abbey — private branding is key to helping each store achieve healthy margins. is store caters to its local market by having an extensive assortment of tile along with a wide selection of area rugs. And a robust advertising program is in play including local and national advertising, which bene ts Abbey stores in every market. “We spend a lot of e ort in creating our own advertising agency that does all types of production,” Gutierrez explained. “ ings that an individual store cannot do — they don’t have the time, they don’t have the [N, F.] Abbey Carpet & Floor cor-porate wears many hats — ad agency, web master, product pro-curement and pricing broker, among other professions — but its true objective is to develop a support system and to create growth opportunities for its dealer members. e franchise of some 840 plus stores Steve Silverman (including Abbey Carpet & Floor and Floors to Go), is dedi-Continued on page 12 cated to full-on support at every level. Prod-uct procurement, chairman and CEO Phil Gutierrez emphasized, is but one element. “At the end of the day, what we do,” said Gutierrez, “is about being able to sell the people that come through the door in a pro table transaction.” Abbey has gone through many permuta-tions since its beginning as a franchise, even under Gutierrez who took over in 1978. “It’s been a long road since then and we morphed from just strictly ‘Here’s the supplier, here’s For breaking news updated each business day, visit us online at www.fcw1.com the prices, here’s the private brand from that P e r i o d i c a l Continued on page 23

Beaulieu back in force

Janet Herlihy


After a year of reorganization, the Beaulieu Group is back with a full executive team, a new Bliss collection and a marketing plan to make its new Indulgence a winner in the softcarpet sweepstakes, according to Beaulieu executives.

Looking to leverage its strengths, Beaulieu has clearly defined roles for its leadership, according to Ralph Boe, who continues as CEO of the company. Since last April, Karel Vercruyssen has served as president and COO of the Beaulieu Group as well as CEO and president of Beaulieu Canada. Vercruyssen oversees all company operations, while Boe handles sales, marketing, distribution and customer service.

The next Beaulieu generation is learning the carpet business, according to Carl Bouckaert, a founder and owner of Beaulieu, whose sons have joined the company. Nicolas Bouckaert is now president of the Beaulieu Commercial division and Stanley Bouckaert is heading up special projects. “Their involvement is an indication of the family’s commitment to the business,” said Bouckaert, who is a Beaulieu board member. “But, it’s a meritocracy. They have to bring something to the table and work as hard as everyone else.”

In October 2012, the company brought on Gary Fisher as executive vice president of marketing for its residential products. With 20 years experience working on such wellknown consumer brands as Nabisco, Corning, L’Oreal, Choice Hotels and Capital One Financial, Fisher is planning ways to boost Beaulieu’s consumer awareness.

In the past year, Vercruyssen created operations efficiencies. “Every company has opportunities for improvement,” he said. “We streamlined material flow in a more logical way and reduced the number of facilities because the market was not coming back. Holding on to capacity that wasn’t being used is not efficient. But we haven’t sold equipment. If there is a significant recovery, we can bring it back,” he explained.

Beaulieu expects 2013 to be a better year, but will maintain a conservative approach. “We need to be realistic,” Vercruyssen added. “All the big suppliers have adjusted capacity and we think the demand will be about the same for the near term future.”

The company is ready for whatever the market needs. Boe stressed, “Beaulieu today has a great team — both outside and inside. Our customer service inside is excellent and our quality that goes out is as good as the best in the industry.”

Indulge with Indulgence
With more efficient manufacturing in place, Beaulieu has refocused its residential carpet line on better goods, according to Boe. Setting out to offer carpet with real solutions to everyday consumer problems, the company first introduced Magic Fresh, an odor reducing treatment and a carpet collection named for the scent reducer. Healthy Touch, a collection made of soft 100 percent Soft Sense polyester filament fiber with Magic Fresh and Silver Release, an antimicrobial treatment, followed. EverClean, a carpet made of solution dyed polyester filament with Magic Fresh, launched in 2012.

Now Beaulieu is launching a carpet that offers solutions — softly. Overseeing product development, Vercruyssen worked with Danny Wade, senior vice president of product development, to create the new Bliss Indulgence. Made of proprietary PermaSoft 100 percent solution dyed nylon, Indulgence features Wrinkle Guard backing, as well as Magic Fresh and Scotchgard Protector by 3M. Indulgence also carries the Bliss Serenity Guarantee, which according to the company, includes a Lifetime No-Exclusion Stain Removal Warranty, as well as other category-leading warranties.

Even the process of naming the new collection is different, according to Fisher. “In the past, we looked at the functional attributes and came up with a name related to those aspects,” Fisher said. “This time, we wanted to develop an image and build in more sophistication and sensuality that can connote a product in a fashion business. We can engage women in a broader way and create more of an experience.”

Beaulieu is planning on creating buzz about Indulgence that will motivate shoppers. “They may not have the name recognition for Bliss Indulgence, but they will want that soft carpet with the odor reducing feature and that wonderful guarantee,” Fisher said.

“Even the backing, Wrinkle Guard, is a special feature that the consumer might be looking for and when they look for a carpet (online) that doesn’t wrinkle, they will find Bliss. We want to be there when they look for carpet,” he stressed. “By focusing on the Bliss website, on social media and consumer promotion programs, we will create a good level of awareness.”

Beaulieu was thinking of crowded retail floors when it developed the Indulgence display. Boe pointed out, “There is so much sampling in the flooring business — so many big racks and big floor displays. We created a smaller display with a variety of styles.”

The display can be moved easily and fits as an end cap. Some retailers are ordering more than one. It holds seven styles with large product blanket samples.

Read the full article at http://bt.e-ditionsbyfry.com/article/Beaulieu+back+in+force/1322862/147762/article.html.

Dealers optimistic about 2013

Kimberly Gavin


[LAS VEGAS] Dealer and distributor attitude was optimistic at Surfaces 2013 — as it has been for the past three years. The difference this year is that they really believe things have turned the corner and better business is ahead. There is also evidence that carpet is making a comeback.

According to reports by Hanley Wood, Surfaces show organizers, attendance figures were approximately 4 percent up versus 2012. If more buyers were there, more importantly is that they were clearly optimistic about business in the coming year. Dealers are also shopping for new products — and the new soft carpets had them scouring the hall to find the most promising for what they hope is renewed interest among consumers.

Keith Spano, president, Flooring America, told FCW that he came off his group’s convention believing things were looking up. He remained convinced aft er visiting Surfaces. “The builder market continues to go in the right direction. It really all comes down to how good people feel. We have more of our members opening new branches. That’s good,” Spano said.

Nick Freadreacea, president/owner, The Flooring Gallery, Louisville, Ken., offered, “We’ve had our best year in years. Everyone I’ve talked to has had the busiest January they can remember. Consumers are ready to get out. Our retail stores are crazy.” Even on the builder side, Freadreacea said, things are going very well. He is getting ready to remodel his stores to better reflect his business — one of the reasons he was at the show. “My sales are half carpet, but my showroom is more than half carpet. I want to bring that in line.”

Dave Snedeker, flooring division merchandise manager, Nebraska Furniture Mart, Omaha, Neb., told FCW that he was really pleased with the way business has been going and is hopeful. “We had a good year last year, but we have been plowing away the numbers so far. I think this will be a banner year.”

Jeff Garber, vice president and general sales manager, Ohio Valley Flooring, Cincinnati, said he budgeted for a 6 percent increase in 2013, but so far business is up 12 to 15 percent in January alone. “I think our market is turning and getting better,” he said.

The carpet business was up 20 percent for the full line distributor. The company formed a relationship with Engineered Floors starting with two carpet lines, and just added six additional products. Carpet is once again a good product for distribution, Garber said. “Three to four years ago, dealers wanted to know who could sell them carpet the cheapest. Now it’s cut and service. That’s why distributors have come back. We can compete.”

Hoy Lanning, president of CMH Space Flooring Products, a distributor based in Wadesboro, N.C., was cautiously optimistic about business. “It’s coming back in baby steps,” he said. “Things have gotten a little better, but everyone is fighting for every dollar.” Business was up last year, but Lanning said it climbed the first half of the year, leveling off in the last six months. He came to Surfaces to see his larger vendors. “People are looking for new opportunities,” he added.

Carpet comes back
At Surfaces, for the first time in a long time, retailers and distributors were talking about carpet. The new soft products — in bothnylon and polyester — have them thinking about new products and opportunities, as well as challenges.

“There’s a lot of innovation,” said Nebraska’s Snedeker. “I’m particularly pleased with the soft choices we have in the market,” he said. Snedeker said Beaulieu’s new Bliss Indulgence was “gorgeous,” to name one soft product on the market.

Soft carpet is not a new phenomenon, but manufacturers have been in something of a race for soft er and soft er products. Today, names like Silk, Bliss Indulgence, Caress, TruSoft , Pure Soft and others speak to a multiple of fiber types and carpet constructions offering a super soft hand to the consumer.

“Everything is soft ,” said, Rick Myers, principal, Myers Carpets, Dalton. “There’s Bliss, Caress, soft polyester — I think it’s great,” Myers said. Meyers company celebrates 56 years in business in July of this year. His sons now work alongside him and his brother Ray in the business that was founded by their father Gene.

Myers services high-end markets in Atlanta, Dalton and Nashville from three locations. The value products offered from companies like Godfrey first, Lexmark, Phenix and Engineered Floors have suited Myers purposes well. They saw a significant increase in business in 2012 and he’s hopeful about this year as well.

“We’re here getting our arms around soft ,” said Jim Walters, vice president, Macco Floor Covering, based in Green Bay, Wis. “The question is how soft do we need to be? The consumer will decide.” He said his goal is to have a handle on where soft is going.

His other purpose for being at market was to fill the void left in the flooring industry caused by Gulistan’s Chapter 11 filing recently (see FCW, Jan. 9, 2013). “There’s a hole that needs to be filled,” Walters said.

While he is riding the soft wave, Walters added, “It scares me from a performance standpoint.” Some soft products will show footprint or vacuum marks. “How do we sell that on the front end without talking the customers out of a sale?” Walters asked. He said he is also nervous about the whole vacuum cleaner issue — some vacuums aren’t suitable for certain soft products. “This is a serious issue. We have to get on the front end of it. Clearly the race to soft was disconnected from the vacuum issue,” he said.

But Walters is happy that carpet is getting some play. “Aft er all the hard surface, it’s great to have something new and exciting. But it needs to be managed. There will be soft and soft enough,” he predicted.

“Soft is not going away,” said Flooring America’s Spano. “We are happy to lead the way. The incredible thing is that we hear all these great stories from sales people.” He related a story from one member that an elderly woman came in to replace her Berber (which she asked for by name). She started to trip and reached to steady herself, her hand coming into contact with a sample of Mohawk’s Silk product. “That sold her,” Spano said.

Spano said Flooring America is helping retailers deal with any issues up front. “You wouldn’t throw a silk shirt in the washing machine,” he explained. “Most customers understand that. We just need to manage their expectations.”

Read the full article at http://bt.e-ditionsbyfry.com/article/Dealers+optimistic+about+2013/1322866/147762/article.html.

Building from a strong base

Amy Joyce Rush


Abbey’s private branding, custom advertising, help members compete

[NAPLES, FLA.] Abbey Carpet & Floor corporate wears many hats — ad agency, web master, product procurement and pricing broker, among other professions — but its true objective is to develop a support system and to create growth opportunities for its dealer members.

The franchise of some 840 plus stores (including Abbey Carpet & Floor and Floors to Go), is dedicated to full-on support at every level. Product procurement, chairman and CEO Phil Gutierrez emphasized, is but one element.

“At the end of the day, what we do,” said Gutierrez, “is about being able to sell the people that come through the door in a profitable transaction.”

Abbey has gone through many permutations since its beginning as a franchise, even under Gutierrez who took over in 1978. “It’s been a long road since then and we morphed from just strictly ‘Here’s the supplier, here’s the prices, here’s the private brand from that supplier’ to where now we spend probably 80 percent of our effort on the marketing part rather than the buying part,” he said.

Gutierrez’s own store here in Naples — a 20,000 square foot space with an additional 6,000 square foot tile and stone store across the parking lot — exemplifies the franchise’s strengths and is a perfect example of what an Abbey store can be. Here, the dedication is in the details: displays are uniform and nearly every product is exclusive to Abbey — private branding is key to helping each store achieve healthy margins. This store caters to its local market by having an extensive assortment of tile along with a wide selection of area rugs. And a robust advertising program is in play including local and national advertising, which benefits Abbey stores in every market.

“We spend a lot of effort in creating our own advertising agency that does all types of production,” Gutierrez explained. “Things that an individual store cannot do — they don’t have the time, they don’t have the money and they don’t have the personnel to do that. So we spend a lot of effort and a lot of money producing websites, producing internal information between us and the store and the industry and the store.”

Whether its newspapers or direct mail, magazines, television, radio, whatever media it happens to be, Abbey has the capability of producing a store’s own proprietary advertising along with a proprietary, custom website, according to Gutierrez.

“We help with the maintenance of the website. They can change as time goes by — change product offerings, special sales. Whatever they want to do we work with them,” he said.

The same custom effort is taken with print advertising as well. Explained Gutierrez, “It is all done by us for them — an enormous amount of different things at no extra cost.”

Steve Silverman, president and COO, pointed out that as technology continues to rapidly change, Abbey provides its members the necessary tools to stay current and successful.

“Our role as a franchisor is to provide services to our members that they can incorporate at their choosing into their businesses to help improve profitability and in turn, their standard of living. It is not our role to mandate or tell our members how they should run their business,” explained Silverman. “The flooring industry, like most other industries, is going through perhaps the most dramatic evolution in its history — that being the importance of technology. Those flooring retailers that are not up to speed with their consumer website and with their ability to reach potential customers through social media and who do not incorporate business-to-business programs within their stores, will be at a disadvantage to those retailers that do. As a franchisor, we have taken the task of providing the latest in technology to all Abbey and Floors to Go members.”

Private branding is another area where the company helps its Abbey Carpet & Floor and Floors To Go stores succeed. “We’ve gotten a lot more sophisticated in our private brands that the store can offer the consumer. That differentiates them from the other specialty retailers. And differentiates them too from the big boxes,” Silverman said.

Abbey’s vast private program includes Softique Nylon by Alexander Smith exclusive from Mohawk and Infinity Nylon carpet collection by American Showcase, an exclusive fiber from Shaw, new in 2012.

“One of the things that we do is provide a private identity for our members that we call private label and within that private label we have private brands that are under an umbrella of a group of products,” said Silverman. “And the importance of those is that they protect our members’ margins.

“Private label has been around for 40 years but in in early 2000s, we added to the private label what we would call a private brand,” Silverman continued. “We did that first in broadloom. And in 2010, we added our own proprietary private brand by adding our own private fiber. Now, it goes through a grouping of products into our own identity in terms of fiber content.”

Warranties are another area that Abbey identified years ago as a competitive edge. “We started our own warranties about 10 years ago that are now popular throughout the industry — the customer satisfaction warranty. If the customer’s not satisfied, we will replace it free of cost within 60 days,” Silverman said, adding that this guarantee has nothing to do with a manufacturer’s defect but rather a simple matter of consumer satisfaction.

Today, Silverman is beginning to see breakthroughs in the economy in all parts of the country. “2013 is going to be a year where our members are going to have to build based on the strong foundation they have. The ones who are in business today are the survivors,” he said, noting that perhaps 25 percent of the retail market exited during the downturn. “Those who are in business in 2013 are those that survived the worst recession this country has seen,” he added.

Read the full article at http://bt.e-ditionsbyfry.com/article/Building+from+a+strong+base/1322868/147762/article.html.

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