Thursday, September 29, 2011

Getting Found Online: a Floor Covering Imperative!

Christine B. Whittemore: Getting Found Online, a new FloorCovering ImperativeThis shouldn't come as a surprise to you, but I consider Getting Found Online a Floor Covering Imperative
I made a case for it in my last blog article - Getting Started: Social Media For Floor Covering Businesses. In this post, I want to call your attention to an ebook from Google titled ZMOT: Winning the Zero Moment of Truth, by Jim Lecinski. Have you read it? It details what goes on for consumers between the moment they realize they have a want/need [i.e., stimulus] and when they make a purchase decision [aka the first moment of truth].

Here's a link to the blog article I wrote on the subject, titled Inbound Marketing and ZMOT: Perfect Together?

Although not a surprise - we are living through the implications of traditional advertising not delivering the results it used to whereas digital marketing, including social media, is becoming more effective - I was impressed that "84% of shoppers said that ZMOT shapes their decisions. It's now just as important as stimulus and FMOT in moving consumers from undecided to decided" [ZMOT, page 20].

Furthermore, it's happening all around us, including in our stores and on mobile devices, and not always in ways that we are comfortable with [see Customers, Digital Devices, The Retail Experience].

As you read through these resources, I'd love to hear what you've observed in your marketplace. How have your floor covering customers changed? How are they engaging in ZMOT activities? How are they finding you online? What are you doing that is helping you get found online? Which programs are generating the most traffic for you and which, the most leads?

By the way, if you're considering new approaches online, you might want to download my Getting Found Online: Inbound Marketing 101 guide.

Thank you for reading. I welcome your comments.

Best,

Christine B. Whittemore

Chief Simplifier
Simple Marketing Now

Wednesday, September 21, 2011

Is competitive cooperation possible in the flooring industry?

David Wootton
The economy and the floor covering industry continue to struggle. One leading CEO of a large manufacturer stated “the industry is years away from a full recovery.”  If this is indeed the case, how many of you will survive without making more strategic and innovative changes in your operating structure? In this environment there is no room for complacency or unnecessary costs. Many companies achieve economies of scale through consolidation but for some that may not be an option. If consuming a competitor is not the answer for you, then consider competitive cooperation.   

Back in the late nineties I was president of a hardwood and vinyl flooring manufacturer that was assessing its distribution network - something manufacturers must do often. We tried an exercise and placed a dot on the map representing our distributors’  branch warehouses and headquarters. The result was a map that looked like it had measles which told us there was a lot of waste and duplication in our supply chain. We knew our distributor network would be more cost effective with fewer but larger distributors so we floated the idea of consolidation. Naturally, this idea went down like a lead balloon and never got off the ground; sunk by questions like “who would be the boss?” and how much would I get for my business?” Lost was any constructive discussion about potential benefits and shared synergies.

But perhaps now the time has come to consider what some may have thought incomprehensible in the past. What seems incomprehensible to me now is that small distributors continue to operate warehouses and administrative systems of their own when it would be prudent to cooperate with a competitor and form a service company to perform the function of warehousing, deliveries, invoicing and other non selling operations. This would immediately reduce costs and add value for each company while enabling them to compete with each other.

This is not a new concept.  A decade ago Jim Gould’s third-party logisticscompany, Distribution Services, Inc., provided shared administrative and logistics services for flooring manufacturers eliminating the need for them to have order desks and claims departments. DSI offered invoicing, accounting, logistics and fulfillment services.  Think about what your bottom line would look like if you could spread even some of these costs over a shared service center. These are the same kind of savings usually gained through consolidation  - which has helped J.J. Haines remain one of the largest, most successful flooring distributors in the country.

Whether manufacturer, distributor or retailer, I urge you to consider new and innovative ways to reduce costs and build value for your company.  Explore whether there is room for cooperation.  If you cannot even contemplate talking to your competitors then at least research whether outsourcing to a third-party provider is a good strategy for you. While shared services and outsourcing may seem unpalatable from a jobs point of view, through this kind of action many jobs may be saved.
  
What do you think of the concept of competitive cooperation? Can it be helpful or is it impossible?

David

David Wootton is President of The Wootton Group, an independent flooring consultancy, and a member of the Floor Covering Institute. He is past CEO of both Columbia Flooring and Harris-Tarkett.

Thursday, September 15, 2011

Warren Tyler wants to find a resting place for that dreaded beige carpeting

Warren Tyler
One of things is the economy. People seeking to sell their homes prior to being kicked out, banks trying to sell them, opportunists who steal these properties to sell them and realtors doing all these things. The sad thing about this whole affair is that beige doesn’t help sell homes. In fact, it is an inhibitor. I’ve proved this on countless occasions persuading landlords and builders to let us use color in their units promising that they would be among the first to move or we would replace the carpeting. It’s the sizzle! People didn’t care whether it matched their furniture of not, they just wanted the most beautiful unit. Where did I get the courage to do this? My mother always told me that if everyone was doing it: It’s wrong! The longer I live, the more I see the incredible wisdom of that statement.

Another factor is a bad economy depresses people, hence beige. During the Regan/Clinton years when everyone was rich and happy, color sold. Marketers employed by the mills have a huge influence over manufacturers and instead of listening to interior designers and decorators and moving forward, they tend to listen to people who know nothing about fashion—consumers. People who forecast color and style trends believe that  at the end of this fix up and sell cycle consumers will become more confident and stable; the thirst for beige will end. Mill executives, influenced by their marketing people and looking at sales figures wrongly come to the conclusion that people prefer beige. When the siege mentality ends so will the thirst for beige.

Here’s how I presented beige at my sales classes: “When you sell ugly beige and the customer gets it installed, what is the first thing customers do? Answer: They call their neighbor to come on over and then ask how they like it?” The neighbor answers: “Like what?" Because the new beige carpet doesn’t look like new carpeting. If her friends ask where she purchased the carpeting it’s only to make certain they will never go near your store.

The floor is the largest unbroken color area in most rooms and as such, needs to be selected first. This means your customer can choose any color they want. The worse thing consumers can do is to select other products and try to match the carpet to all of the stuff they selected. It has to be an educational process. First choose the color of the floor, then possibly the walls, window treatments and fabric in about that order. We don’t sell flooring. We create beautiful rooms.

No home interiors product can be customized so easily, do so much to beautify the home, in so little time for so little money than colorful carpet. It is easily one of the best consumer buys on the market and yet we are losing market share.

There are solutions:
First, get over the fallacy that beige can help rent apartments and sell homes, mill executives have to listen to design professionals and become trend setters, stop making and selling high pile soft yarns (just had to throw that in) and pray we elect those who can help lead us out of this Keynesian economic mess.
Meanwhile, at least provide a rudimentary design education for your people. Hire designers on your floor and educate your customers about creating a beautiful home and how much better they will feel sans ugly beige. I was always a contrarian retailer. You know, someone who  has a preference for going against the grain. Contrarians usually win. In these times, it isn’t going to hurt to try something new.
Who would have thought that you could be a contrarian by not focusing on beige?

Warren 

Warren Tyler is a professional speaker, retail consultant and educator as well as author of several books, CDs and DVDs targeted toward flooring retailers and salespeople. He is also a consultant with the Floor Covering Institute. Read Warren's column at Floor Covering News.

Tuesday, September 13, 2011

Top cause of failed shower installations? Installer training

Donato Pompo
Flooring retailers often get blamed when a tile installation goes bad. The installer is typically the last person the homeowner sees and if everything goes well you and the installer are golden. But when the installation goes wrong, everyone comes under scrutiny.  Bad installations ruin customer relations and are enormously expensive to rectify, especially when water damage from a faulty shower install causes massive collateral damage throughout a house.  Properly trained installers can avoid such a catastrophe - that’s what this post is about.

Beauty to Beast - Failed shower installation
We have learned that ceramic and stone installation failures are not usually the result of one deficiency, but rather a combination of compounding deficiencies. One of those deficiencies typically involves installer error. Combined, they can sabotage the most beautiful tile and stone designs and create potentially dangerous conditions that lead to very costly repairs.


Here is an example of compounding deficiencies in the construction of a condominium shower that led to massive damages to the surrounding walls and other rooms in the home. 

Showers are high risk applications

Moisture is one of the most destructive elements to the construction industry causing various types of deterioration and microbial growth that can be a health hazard.  A shower is considered a high risk application because it is exposed to water on a regular basis.  An average size shower used once a day for 12 minutes is subjected to approximately 690 inches of water per year!  Compare this to a typical California roof that only gets about 10 to 20 inches of rain a year or “wet” geographic areas that get 100 or so inches of rain per year.  It’s common sense that a shower should receive at least as much attention as a roof when it’s constructed, but believe it or not, it’s often overlooked.

The case for standards and building codes

Properly installed showers have waterproof membranes between the substrate and floor tile that should continue up the walls for a few inches.  Building codes state that the membrane must be water tight; not punctured with nails or other protrusions, and the membrane should be tested prior to installing tile over it to ensure it doesn’t leak.  Industry standards require that the substrate beneath the membrane slope towards the drain at the rate of ¼” per foot – to ensure water runs toward the drain.

In this condo, the membrane wasn’t welded properly and water was allowed to intrude beneath it. The substrate was not slopped properly; in some areas it was even sloped away from the drain. Plumbing codes and industry standards require a special two part drain to be used in showers with weep holes allowing any water that gets trapped between the tile and the waterproof membrane to escape. Our investigation of the condo shower revealed that the weep holes were plugged with cement, further compounding the other deficiencies.

How the collateral damage occurred. The condo had sound control board throughout.  This type of board is vented and provides a continuous opening that leads all over the rest of the home.  The water from the shower leaked through the defectively seamed waterproof membrane and then traveled away from the shower through the open sound control board collecting in wall cavities and under hardwood flooring of adjacent rooms.  The result was massive water damage and microbial growth in a number of rooms.

To remediate the mold, all of the adjacent flooring and subflooring had to be replaced, along with all of the water damaged walls. (http://www.epa.gov/mold/).  The ultimate cost to remediate one condo was well over two hundred thousand dollars!  The irony of it all is that, after all of the shower and adjacent flooring was removed, the only dry spot in the whole area was at the drain under the shower because the substrate was improperly sloped away from the drain rather than towards it!

Quality control is key to avoiding installation failures

So what’s the moral of the story?  You have to make sure that installers know and follow industry standard and that they have clear specifications of how to do the work properly.

Installers should be provided specifications from architects or product manufacturers to ensure they are properly constructing installations and using the products correctly.

Installations should not start until the substrate is known to be properly constructed and prepared.

Installers must be properly trained in the trade. Typically, tile and stone installers learn on the job and do not attend formalized schooling.  They will frequently say they’ve been doing installations the same way for 20 or 30 years without any problem.  But that is the problem!  Many installers are not current on today’s industry standards.  Unintentional mistakes can be made that can cost owners thousands of dollars in collateral damages.

Use qualified third-party quality control inspections, especially in high risk applications such as showers or exterior veneers.  This not only keeps installers in check during the installation process, but it also teaches them proper methods.  If you think you can’t afford third party quality control, then homeowners themselves should fill that role by doing the research on industry standards and reading the product data sheets to make sure their installers follow them.  It’s a lot less expensive to pay for quality control at the beginning of a project than to pay for fixing a failure at the end.
We can’t control how well an installer is educated in his or her trade. Most installers learn on the job. There is a need for more readily available, formal training for installers, and we have addressed that with the new UofCTS online TITC Certified Installer training course. The course is called Tile Installer Thin-set Certification (TITC) course for installers who install ceramic tile, glass tile and stone products at http://uofcts.org/certification-program/tile-installer-thinset/

How do you avoid tile shower failures?  By making sure installers are properly trained, by making sure they are TITC Certified by UofCTS.  Showers require a lot of protection from water, and tile and stone are good products to provide that protection, if they are installed correctly.

Visit our website for a free copy of quality control steps for your tile installations.

When there is a problem, regardless of who is at fault, everyone involved will pay one way or the other in money, time or reputation.

Donato

Donato Pompo  is founder of two well-known flooring industry companies focused on improving everything about ceramic tile and stone flooring and the businesses that produce and sell them. They are Ceramic Tile and Stone Consultants (CTaSC) and the University of Ceramic Tile and Stone (UofCTS).

Wednesday, September 7, 2011

Beaulieu International enters LVT market with SuperClick

The most exciting product at Domotex 2011 (both Germany and Shanghai) was a unique LVT called SuperClick - the fastest, easiest click system ever developed which effortlessly joins tiles while eliminating the performance issues experienced by existing LVT click systems. This morning SuperClick and Beaulieu International Group (BIG) announced big news for the international LVT market.  SuperClick and Beauflor will take the SuperClick technology to market across the globe under the names SuperClick and Dream Click.

I had the pleasure of working with SuperClick and am pleased that this technology will be coming to you soon.  Here is their press release which just went out this morning and is already getting picked up by the press.

Jim 
Jim Gould is President of the Floor Covering Institute
jgould@floorcoveringinstitute.com


Read more of Jim's postings at his Blog Roll
 

Monday, September 5, 2011

New floor covering opportunities revealed in the multi-family housing market

Stuart Hirschhorn
FLOOR COVERING STATISTICAL TRENDS AND OUTLOOK

As a floor coverings industry analyst who pours over housing data on a daily basis, the trends I have seen over the past five years have been pretty depressing.  I have to contend with the daily headlines about foreclosures, tight credit conditions, declining home values, and sharp drops in new and existing homes. So you can imagine how I felt when I saw the latest positive trends for multi-family housing construction.  In the first seven months of 2011, permits for new multi-family housing units jumped by 25.4% and starts soared by 51.7%.  Starts for multi-family rental units were up at an even sharper rate, closer to 60.0%.  Compare that to new single-family homes which are down by about 16.0%.

Declining home values, high unemployment rates and weak income gains that limit the ability to purchase a home mean more families no longer see the financial benefits of home ownership.   As a result, the U.S. home ownership rate has dropped to 66.5% in 2010, down from 69.2% in 2004.  Meanwhile those renting homes have increased by some two million over the past five years.

As rental property owners and developers take advantage of the shift to rentals, the multi-family rental market could become one of the bright spots for the U.S. floor coverings industry for the remainder of 2011 and for 2012. 

The weak home buying market has increased the number of renters and reduced apartment vacancy rates.  According data released by Reis, Inc. and reported by Bloomberg, the apartment vacancy rate declined to 6.2% in the first quarter of 2011, down from 8.0% a year earlier. Over the same period, apartment rents were increasing at 2.5% to 3.0% nationally, and over 5.0% annually in some strong markets such as New York City and Virginia.  These trends caused property owners to make improvements and developers to start new projects as apartment building finances improved.

This increased activity in the multi-family rental market has caused that segment to take an increasing share of the residential floor coverings market.  This is especially true in the broadloom sector, since wall-to-wall carpet covers a greater share of the typical rental unit.  As a result, Catalina Research estimates that about one-third of total U.S. broadloom sales are now attributed to the multi-family rental market (renters, property managers, and builders), despite the average rental unit being about 30.0% smaller than average owned housing unit.

According to the U.S. Department of Commerce, there are approximately 60,000 lessors of residences and 38,000 residential property managers. Catalina estimates that together these two buyers purchase about $1 billion in broadloom annually (in manufacturers dollars) or about three quarters of the multi-family rental broadloom market and about 25.0% of total U.S. residential replacement carpet sales.

To succeed in the floor coverings industry today, you must be able to take advantage of the opportunities in this important and growing market.  What information do you need to exploit this growing market?

Stuart

Stuart Hirschhorn is a member of the Floor Covering Institute and Director of Research of Catalina Research, Inc. which provides in-depth market research on the floor covering industry.

Thursday, September 1, 2011

Thoughts on the Consumer Confidence Index

Christopher Ramey
The Conference Board publishes the widely reported "Consumer Confidence Index" every month.  It is often an accurate predictor of floor covering and home furnishings sales. 

What isn't widely known is that the report can be dissected into a "Present Situation Index" as well as an "Expectations Index."  For business owners the former is more relevant because Americans are historically an optimistic lot.

Today’s press release from The Conference Board reads: “The Conference Board Consumer Confidence Index®, which had improved slightly in July, plummeted in August. The Index now stands at 44.5 (1985=100), down from 59.2 in July. The Present Situation Index decreased to 33.3 from 35.7. The Expectations Index decreased to 51.9 from 74.9 last month.  Today’s data on August reflects the fifth consecutive decrease for Present Situation Index.”       

Despite their falling confidence in the present situation, Americans are still spending money in some sectors.  In fact, Americans have acquired half a million luxury cars year to date.  Perhaps a poor economy and a collective bad mood aren't always to blame for lackluster sales.  What can the floor covering industry do to parrot the car industry and break-away from the housing industry doldrums?

I look forward to your thoughts.  Chris

Adopted from the Ramey Report, August 2011 

Chris Ramey is president of Affluent Insights and a member of the Floor Covering Institute.