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Showing posts from 2010

Can strong growth in flooring sales depend on the success of the electric car?

FLOOR COVERING STATISTICAL TRENDS AND OUTLOOK

It may not seem logical to the casual observer that there would be any relationship between US floor covering sales and the success of the electric car. However, consider this. Historically, the introduction and commercialization of new technology has usually led to stronger economic growth and sharper gains in personal income and consumer spending. The resulting sharp gain in personal income and consumer spending has always led to strong floor covering sales growth.

These correlations can be seen in the late 1990s, when the Internet became commercialized and revolutionized the way we communicate, shop, and seek entertainment. The Internet revolution led to a surge in new business investment, soaring employment, and rising productivity. As a result of these positive trends, US real disposable personal income increased close to 4.0% annually between 1996 and 2001. This relatively strong increase in personal income led to a 5.6% annual gain …

How the “New B2B” Can Revolutionize Your Flooring Business

 This is post 3 of a three-post series on the status of B2B in the flooring industry. You can read Post 1 and 2 here:  Dancik asks,  "What's wrong with the B2B in the flooring industry?" and  New plans for B2B improvements will add value for the distributor and retailer.

Web services are coming to floor covering providing both solutions and opportunity for the industry.

Imagine a retailer that can access its supplier’s information as if that information was stored inside its own retail computer system. Imagine a supplier who no longer worries how its data is formatted - or how its brand information is represented by distributors and retailers. Imagine the entire floor covering channel answering consumer questions confidently and consistently because the consistency is built into the process. All this and more can become an everyday reality if the direction that was set at the 2010 annual flooring industry B2B meeting comes to fruition. 

What is the New B2B?
The new direc…

Anti-dumping allegations will profoundly effect engineered flooring market regardless of investigation outcome

On December 3rd the International Trade Commission (ITC) announced an affirmative determination in its preliminary investigation of claims made by US engineered flooring manufacturers against China. The ITC has stated there is sufficient evidence to launch an investigation by the US Department of Commerce. A final determination is expected around the end of July 2011.  Read their decision here.

This is a complex issue that isn’t so simple as US. vs China. This action is creating a situation where some US distributors and importers are lining up on the side of China, where others are questioning who the potential winners and losers might really be and point out that the remedies sought by the US manufacturers could “deliver a potential fatal blow to many American entrepreneurs,” by making the distributors and retailers pay retroactively for new tariffs.  Read: "Distributors question ITC investigation impact." 

So how did this situation arise?

Back in October the Coalition of t…

Quality control - the best way to avoid ceramic and stone installation failures

Installation failures are the most detrimental occurrences in the ceramic tile and stone industries.  They leave the wrong impressions about products or services and they can be very time consuming and expensive to repair. 

 Will Rogers once said, "It takes a lifetime to build a good reputation, but you can lose it in a minute." That’s so true when a ceramic or stone installation fails. Thankfully it doesn’t occur frequently, but when it does everyone involved loses.  It doesn't matter whose fault it is, everyone pays one way or the other in money, time or reputation.  As an industry, it's in everyone's best interest to do whatever we can to avoid failures and perpetuate quality installations.

The best way to ensure quality installations is through a Project Quality Control Plan.  A Plan sets expectations and standards for a successful outcome. Not only can this help avoid a failure by ensuring the products are being installed correctly, but during the installat…

5 Points for Achieving Painless Negotiations

After 40 years in the flooring industry you can be sure that I’ve negotiated my way through plenty of deals - perhaps not always as effectively as I wanted to.  We’ve all have experience with business negotiations that were not pleasant or positive. Sometimes negotiations feel like a battle  -  a fight between two parties defending their positions, each one trying to avoid “loosing” to the other. With experience I’ve learned there are techniques that make negotiations less painful and more satisfying to both parties.

Whether the negotiations are about a contract, family-twist or peace talks between countries, people in general automatically tend to start in the mode of Positional Negotiation. Positional negotiation is essentially adversarial; each party sees the process as a “win-lose” situation, each using their necessary arguments to defend their position against attack.  A win on one side is a loss on the other and in the end concessions lead to compromise and neither party may be …

Do floor covering industry trends concern or include you?

Research tells us that consumers place little value on flooring.  Is this the fault of manufacturers, distributors or retailers?  Does it concern you that the fastest growing entities in the industry are home centers and Lumber Liquidators?  Can independent retailers survive if home centers own 50% share of the floor covering market?  

Is it disconcerting that the industry is moving to fibers that we know don’t wear well in our attempt to hit price points rather than serve the customer?  Does that help our independent retailers create value or further damage their credibility? 

Does it concern you that the growth of hard surface will greatly extend the normal replacement cycle of floor coverings?  Many people think independent retailers will go the way of television and organ stores.  Are floor covering retailers chum for suppliers?  Why would our industry be any different? The only way to change the future is to address the present. 

Are these concerns real or a symptom of the eco…

New plans for B2B improvements will add value for the distributor and retailer

Mitchell Dancik talks about new developments in B2B:
I recently returned from the annual flooring industry B2B meeting held by the Floor Covering Business to Business Association.  I’m excited to tell you about the new plans to improve B2B for distributors and retailers of hard surface flooring. These new enhancements will make hard surface distributor catalogs “SKU based” and far more useful to retailers than ever before.

If all parties (software companies and flooring suppliers) deliver on this year’s commitments, retailers will be able to receive a catalog where every SKU can have its own prices, specifications, drop dates, etc. Each SKU will still transmit within its associated style or product line, but SKUs can be re-grouped however the retailer sees fit. This will also improve the value that local distributors bring to their retailers.
Amidst the tight budgets of this moribund economy the meeting was the most well attended B2B meeting ever. But sadly the industry segment that mi…

Wootton's Outlook on the Flooring Industry

October 28th is a milestone day for me and my family. It will be 20 years to the day since we came to America and the floor covering industry. The headlines that day were shared with two major issues:
•    America was fighting a war in the Middle East.
•    The nation’s economy was in a very poor state.Fast forward 20 years and the headlines are the same with little sign of the war ending or the economy improving in the immediate future.

I find myself asking how 20 years have passed so quickly and how so much could have happened and yet so little has changed, and more importantly, I wonder what the future holds. For me personally, life hopefully will mean travel, enjoying my family, working on interesting projects and doing all the things we have been unable to do during the years when work came before everything else. As for the future of the floor covering industry, well that’s a little more complicated.

Although the stock market is currently trending upwards, unemployment remains hi…

China's flooring innovations increase

ANOTHER TRIP TO CHINA YIELDS NEW INSIGHT FOR FLOOR COVERING

A few years ago Thomas Baert, president of Chinafloors  and its brand Lamett USA told me “China has been the low cost producer but soon it will be the source of innovation.”  That was quite a statement considering in the 1990’s the country’s reputation was to partner with Westerners simply to access modern technology and information.  That, like so much else is changing remarkably fast in Chinese flooring.

I have visited China about twice a year since 1992 and every visit reveals something new.  I just returned from my most recent trip and can confirm that the metamorphosis continues. Just riding to the airport in Shanghai I saw more building cranes on skyscrapers under construction than probably exist in the whole US Midwest.

Only five years ago it was common to see hopeful workers standing every morning 50 deep for a job in a flooring plant. Today, manufacturers talk about the difficulty of finding good workers and the nee…

Creativity in Flooring: The Bigger Picture

Have you considered the state of creativity in flooring? An interesting article appeared recently on TalkFloor.com titled Consumer Purchases Influenced by What's Under Foot? which had me thinking about it.

The article caught my attention for two reasons.  One because it addressed the consumer retail experience, a topic I'm passionate about, and cited research that I've written about on Flooring The Consumer [see Flooring Affects Retail Experience] which in turn led the Carpet and Rug Institute's Bethany Richmond to write Carpet Steps Up Retail Sales, Study Says.

It also intrigued me because the company responsible for the article - Desso - is one I wrote about on The Carpetology Blog in World Cup Extends To Grass Carpet. Desso, an 80 year old European carpet manufacturer, seems to have embraced creativity in flooring in a way I haven't seen. As I learn more about their innovations, I can't help but think that the reason has a lot to do with being focused on th…

Stone floor construction - good data leads to intelligent decisions and market strategies

Developing strategies for stone and flooring construction markets requires that you understand the market and materials. You are only limited by what you don't know - and that can be remedied with good research and data.

I have been saying for what seems like forever, "we have re-entered the stone age."  I'm talking about natural stone of course. Natural stone is millions of years old and has been used for thousands of years by man for various uses from weapons, tools, shelter, communications, art, and building materials.  But in the most recent decades stone has exploded in its use as a preferred building material. 

As old as stone is you would expect there to be more information about this industry.  Until recently there has been relatively little statistical and marketing trend data available to help companies intelligently navigate their businesses through business threats and opportunities.

During the U.S. economic boom of the late 1990’s a trend began for using…

Floor covering consumers turn cautious

FLOOR COVERING STATISTICAL TRENDS AND OUTLOOK

How was your flooring business this summer? Was it disappointing? Did customer counts come in lower than anticipated? Did buyers express even more preference for “value” products? Where did the optimism go for a 2010 recovery?


I was optimistic earlier in the year when I posted "Catalina says U.S. Flooring Industry Set For Spring Thaw-Who Will Benefit?". In that April post I indicated that there would be a recovery in the second quarter and the recovery would accelerate over the entire year. Recent data shows that there was a 4.3% increase in U.S. manufacturer square foot floor coverings sales in the second quarter over the previous year. This was the first increase in U.S. demand in almost four years as retailers restocked in anticipation of rising consumer floor coverings purchases.

However, as a warm spring turned into a hot summer, a series of events turned your customers cautious. The following events turned a spring thaw…

Floor Covering's New World Order Online

How relevant do you consider the web to you and the floor covering industry? I consider it significant. I believe that access to information online is paving the way to a new world order. In case you haven't yet had an epiphany similar to David Wootton's in Flooring and the Internet - Now I’m a Believer,  I'd like to put this new world order into consumer and business context and get your reactions.

When you're in the market for a product or service, how do you go about getting information before purchasing? Do you get into your car and drive around? Or do you sit down in front of your computer and type in Internet search terms in an online search engine such as Google, Yahoo! or Bing?

I start online. Even if I plan on driving around, I'll start at the computer to double-check locations, hours of operations, availability of parking [or access to public transportation] and to confirm product selection. Even for flooring.

The more complex the purchase, the more onlin…

Floor covering shows - the great treasure hunt

I’ve been in the floor covering industry for over 40 years and along the way I’ve been labeled with a few nicknames.  When I bought Color Tile,
Jon Trivers nicknamed me “Jimmy the Grout.” At CCA they called me the “Cork King” because I loved cork flooring.  As their Chief Product Officer I could have covered my office floor with any product but I chose cork which, at the time, was unique.  It was quiet, resilient, warm, wore well and, most importantly, that floor encouraged people to think outside of their paradigm.


I think that is the same reason I love going to Domotex Germany and Domotex Asia China Floor every year -  because what I see challenges what we hold as the norm in North America. When carpet still had over 70% of the floor covering market here, Scandinavia’s carpet market had fallen to 10% share!  While Americans were stuck displaying carpet on waterfall fixtures, Europeans were using sophisticated lighting and design to showcase carpet as fashion.  While sheet vinyl was on…

Leveraging opportunities - two strategies for flooring retailers in a downturn

Consumer confidence, perhaps the best gauge for retail, continues to deteriorate. The headline from Floor Covering Weekly’s recent issue said it all: “Year three of downturn deals biggest blow yet.”

You, like most businesses in the flooring industry, have probably cut to the bone in order to survive.  Considering it is unlikely to get much better any time soon, it may feel like it's time to carve the marrow. The new normal is crueler than anyone imagined. But, the act of cutting costs should not be your only resolve.  Growing market share has to be part of your strategy now. As Stuart Hirschhorn pointed out last month in "Strategies for increasing your floor covering market share," any strategy to grow business "must include a goal to increase market share." And growing market share is easiest when your competition is hurting. Consider these two strategies for leveraging new marketing and merchandising opportunities: 


Examine Your Aligned Buying Associations

On…

Flooring Warranties and Expectations: Oh, what tangled webs we weave

We surely see some tangled messes in the flooring industry when customers buy flooring products based on marketing and not based upon choosing the right products for their location or application.  Invariably, the product doesn’t live up to their expectations. Flooring warranties are part of the marketing package; they are not insurance against a bad product choice and we need to do a better job at making sure our sales people and customers understand the difference.


For every application there is an appropriate product. The right product in the right place, and there always is one, will perform up to the expectations of the end user. The role of the flooring professional is to guide the buying decision toward the right product. In the absence of professional help a consumer is left to make a decision based upon marketing alone. Even with "professional help" they can come away confused.  Here's a great example of a consumer who is trying to make the right carpet decisio…