s - Floor Covering Weekly
Transcription
s - Floor Covering Weekly
Vol. 62 No. 24 A Hearst Business Publication December 23, 2013 $25 2013 Industry Report State of the PREPARING FOR GROWTH Investments, product changes set stage for future By Amy Joyce Rush P e r i o d i c a l Hard work, investments and expansion defined much of what happened in 2013. For the first time in years, suppliers talked about rebuilding and preparing for the upturn which, they said, is finally here. “2013 was the first strong recovery since the Great Recession,” said Randy Merritt, president of Shaw. “The improving economy has reinforced the value of preparation and the importance of looking forward that has always been a part of Shaw's strategy. Throughout the recession, we asked ourselves, ‘are we prepared for our customer’s business to improve? Are we prepared to service increasing demand from all channels of our customer base? Is our product assortment right for what the expanding consumer and end user base will want? Are we prepared for growth in every segment of our business?’” Merritt said that at Shaw, the answer is “yes.” At Mannington, the integration of Amtico went “extremely well,” said Kim Holm, president, residential business, Mannington. “The year as a whole was a building year — integrating Amtico, anticipating and keeping up with demand as the economy came back to life, and adjusting our businesses accordingly.” Tom Lape, Mohawk’s president of residential flooring, said that 2013 was rewarding for the company because of the investments it made even in a down market. “These strategic investments have proven to reap rewards as we make gains coming out of the recession. Additional capacity, improved quality and enhanced production efficiency are all positive outcomes of these investments, and our retail partners have benefited as well to get better products at better values from Mohawk Industries.” Growth realized “The economy finally showed some improvement and provided for a relatively strong year for Mannington,” noted Holm. “Certainly the economy improvement was the highlight of 2013. We are anticipating continued gradual improvements in 2014 as well.” Merritt said Shaw is pleased with 2013 growth. “We anticipate that the economy is going to continue to slowly improve, driven by the housing recovery, a strong automotive market, strong markets in some other manufactured goods and slow ✓ For breaking news updated each business day, visit us online at www.fcw1.com fcw122313pages.indd 1 but steady improvements in employment,” he said. Likewise, Lape of Mohawk said that the company is pleased with the progress that the floor covering industry is making as it rebounds. “2013 marks another year of growth for both the flooring industry and the carpet segment in particular. This is due in large part to all aspects of consumer demand showing varying levels of improvement,” he said. Kevin Biedermann, Armstrong Flooring Products senior vice president, noted, “We are looking forward to another up year. I don’t think it will be spectacular but it will be positive, which is good.” He noted that the company will continue to focus on “managing expenses, continue to drive cost productivity through process improvement and adjust its manufacturing footprint based on demand.” Challenges faced At Shaw, one hurdle has been the shift in customer demand within the company’s product mix. “For example, growth on resilient, hardwood and carpet tile is changing the Continued on page 6 For more info, scan the QR tag using your smart phone to be directed to our website Fill out the entry form on PAGE 20 to be apart of the Premier Awards Program this year at Surfaces! Visit us at booths: #S5761 & #B3370 12/17/13 1:05 PM To register for the Shaw Market Events visit www.shawshows.com SHAW WINTER MARKETS January 7-8 January 9-11 January 15-16 January 15-17 January 22-23 January 28-29 February 5-6 Atlanta, Georgia Dallas, Texas Chicago, Illinois Anaheim, California Niagara Falls, Ontario Mashantucket, Connecticut Atlantic City, New Jersey We look forward to seeing you at our Winter Markets. Don’t miss out on the introduction of our new exciting products and programs! Carpet | Area Rugs | Tile & Stone | Hardwood | Laminate | Resilient fcw122313pages.indd 24 shawfloors.com 12/12/13 4:19 PM News 3 New Mohawk Flooring Center has it all center for all new product and marketing innovations launched from the Mohawk [Calhoun, Ga.] This fall, the new Mohawk Flooring & Home division. More than 100,000 square feet, the redeFlooring Center here became the home for the residential, commercial and international signed building has brought together offices teams, including sales, marketing and prod- and personnel from 11 different facilities and uct management. Once home to a spinning located them just next door to the corporate mill built in 1983, the building has been com- leadership offices. Brian Carson, president of Mohawk Floorpletely renovated and is now the executive ing, had a vision to build an industrial building with a modern sensibility. He also wanted “to create an atmosphere where all of the flooring teams could collaborate and push the limits in creative design,” said David Duncan, SVP marketing. “It’s working beautifully and the results will be clearly demonstrated with all of the new product innovations shown during our 2014 Regional Product Markets.” The cafeteria in the Mohawk Flooring Center uses repurposed wood on the ceiling. Some building details exemplify By Janet Herlihy Mohawk’s dedication to sustainability. In the cafeteria, wood planks from old semi-trailers were refurbished and installed on the ceiling. Metal piping and other iron works from various Mohawk facilities were repurposed to become pillars and supporting columns within the building. “The reclaimed materials help us qualify for LEED credits,” Duncan explained. “They also contribute to creating a beautiful, industrial-chic style.” Mohawk has begun the process of applying for LEED certification for the building. These applications generally take months to be approved, but the Flooring Center is full of features that contribute to LEED certification. A “brand wall” presentation that lines the main hallway and leads to the showroom displays Mohawk’s latest products and chronicles the company’s history. “The showroom was the last room to be installed on site,” Duncan noted. “All the products Mohawk’s Flooring Center is the new hub for residential, commercial and international teams. that are sold under the Mohawk brands are on display along with areas that feature our other businesses — Dal-Tile, Unilin, Marazzi Tile and Mohawk Home.” The Mohawk Flooring Center also serves as a key destination for customers and has already welcomed guests from around the world, according to Duncan. “Mohawk plans to expand the facility in the future as the company continues to grow,” he said. FCW FCW Correction Corrections FCW FCW Redi Carpet rides multi-family market wave into 2014 [Houston] Suppliers have been reporting that the multi-family market is a hot segment for flooring and Redi Carpet is a good example of why. Redi Carpet, based here, operates facilities in 17 cities in eight states that primarily serve the replacement flooring market in apartment complexes as well as some new multi-family projects, according to Jerry Hosko, president and COO of Redi. Redi’s 2013 flooring business, primarily in base grade carpet, sheet vinyl (especially fiber glass) and luxury vinyl plank and tile (LVP and LVT) was up overall about 15 percent over 2012, according to Hosko. “Most of that growth was organic and exceeded our expectations,” he reported. “There’s a lot of pent up demand. The apartment industry did not suffer like single-family construction. It has been fairly consistent without the severe ups and downs of retail. Even in the worst of the recession, we were only down 10 to 20 percent. Also, being Texas-based with a lot of our business in Texas, there was still a lot of new construction. We actually benefitted from the recession because when people lost homes they still needed housing so apartments have grown. We expect the same kind of growth in 2014 in terms of new apartments and replacements,” he explained. When it comes to what kind of flooring is in demand in multi-family replacement, Hosko advised, “Look to what the new complexes are putting in. Older properties have to compete with newer properties. If the new properties are using new flooring products, the older apartments have to replace with the new product too.” Luxury vinyl flooring is the fastest growing category for Redi. “LVT has taken over any SmartStrand takes on Mo the dog [Dallas] Mohawk’s cross 10 million viewers. Mo country License to Spill will be at the Puppy Bowl. campaign in 2013 was so When Times Square successful, the company is closed off for the NFL announced here at conextravaganza, Discovery vention its new campaign Communications, parent for 2014 will center around company of Animal Mo, a yellow lab quite capaPlanet, will host an expo ble of creating hard to clean from Jan. 26 to Feb. 1 messes putting SmartStrand with Mohawk carpeting Mohawk’s Elise Demboski presents to the test. the 15,000 square foot the Mo campaign to the press at To get the campaign, convention. facility. Again, Mo will be SmartStrand Unleashed, in attendance. started, Mohawk will be the official sponsor Mo will appear on The Better Show — of Puppy Bowl X which airs on Animal Planet which was an integral part of the License to the same time as the Super Bowl to more than Spill campaign. He will also film 12 webi- laminate and there is virtually no ceramic used,” carpet with every new lease, while others Hosko said. “There is less carpet and more LVT try to wait longer by cleaning it to extend going in now. It (LVT) is more forgiving, has its life, Hosko said. In the past three to four great fashion and it’s cost effective because it years, polyester (PET) carpet has increased doesn’t have to be replaced as often,” he added. and is close to 50/50 with nylon carpet in “We have had huge growth in LVT for the last Redi’s business now. “The PET does work,” five years. The residents have not found a way Hosko said. “We have had some of it down to destroy LVT. Sheet vinyl gets tears and dents. four years.” — Janet Herlihy Once the wood plank look started in LVP, the owners started to change out more floors to it. The product has moved from the kitchen to the dining room and into the living room. Some are even putting it in bedrooms. We expect that LVT might ugly out by losing its luster and then it will be more expensive to replace, but that hasn’t started to happen yet,” Hosko explained. Redi Carpet’s showroom in Houston spotlights Some properties change out carpet and LVT. sodes of Mo’s Next Mess. The effort will be supported by a “blow out on social media,” said Elise Demboski, vice president of creative services at Mohawk. The fully integrated campaign offers point-of-sale kits, advertising tools, social media content, digital banners, customizable press releases and fully loaded event kits for its dealers. In addition, SmartStrand will be promoted on air and a digital campaign will invite fans to Instagram a photo of their dog watching Puppy Bowl X for a chance to win a dog bone shaped SmartStrand bound carpet. In addition to generating excitement for SmartStrand, Mo is raising awareness for pets in need through Mohawk’s partnership with the Petfinder Foundation. Mohawk is donating $2 for every “‘like” the company Mo is the cornerstone of Mohawk’s new Smartreceives on its Facebook page. FCW FCW Strand campaign. Correction Corrections December 23, 2013 fcw122313pages.indd 3 WWW.FCW1.COM · FLOOR COVERING WEEKLY · FCW FCW 12/18/13 9:23 AM 4 News 2014 Mohawk Solutions: Own the Moment By Amy Joyce Rush [Dallas] Mohawk certainly owned the moment here at the 2014 Solutions convention last week. Integrated product launches and a sharp focus on digital — The Cloud — which included everything from web to social media and managing one’s online reputation. “Our goal is to be your go-to company for all flooring — from premium to value,” said Jeff Lorberbaum, chairman and CEO of Mohawk. “Mohawk today is in the strongest position than ever in our history.” In fact, Lorberbaum revealed that Mohawk is now listed on the S&P 500 along with Facebook and that, “in a little over a year, our stock prices doubled. We strengthened our balance sheet and reduced our debt. This year, we changed our approach moving from a conservative approach trying to reduce costs to an aggressive growth strategy,” he said, adding that the company invested some $2.2 billion in new equipment and acquisitions. “In the first half of this year, we acquired three companies,” he reminded dealers. The Marazzi purchase, he said, gives Mohawk 40 percent of the U.S. ceramic market. Pergo also gives the company more than a 40 percent share of the U.S. laminate business. And Spano, a niche, regional board manufacturer, will help the company expand its product line and address more customers. I believe we are building the infrastructure to separate us from everyone else,” Clauson added. Hard Surface The hard surface message was a cohesive one. Popular character wood looks, for example, were made available across all product categories and price points so that no matter the platform or budget, Mohawk hard surface has a product to fit the consumer’s need. “You’ll see character wood looks being fairly significant,” explained Roger Farabee, senior vice president, marketing for Mohawk Hard Surfaces and Unilin Flooring. The Cloud Across all platforms — Lorberbaum noted at genhardwood, ceramic and eral session that the Internet porcelain tile, laminate and and social media are among the luxury vinyl tile (LVT) — the biggest game-changers in hiscompany brought a strong tory. Mohawk is working with design focus coupled with the its dealers to not only create goal of reaching different price strong sites and have a meanpoints within the market. All ingful social media presence, the introductions were driven but it has a plan for managing by technology and innovation. dealers’ online reputations. ArmorMax was expanded “The Cloud is a digital serand even combined with vice to help your online pres- Jeff Lorberbaum Scotchgard. “We are always ence. Mohawk is here to give trying to find smart ways to use technology,” you an advantage,” said Lorberbaum. One of the most important efforts Mohawk noted Farabee. Mohawk is also adding SKUs to LVT visuis making is to help dealers manage their online reputation. “Online reputation is als as well. Said Farabee, “We are incredibly critical today. That is ratings and reviews and excited about the additions we are making to Architexture is a new engineered social media," said Kent Clauson, vice presi- the LVT category.” Additions were made to hardwood with a European look. dent, brand and digital. Mohawk will help its the Simplesse line and Prospects collection. dealers manage reviews and The company also introduced the Prospects ratings by generating content Plus line which boasts longer planks and a on its site from consumers. tougher wearlayer. Ceramic visuals were enhanced by Reveal “If we don’t actively solicit reviews, all we will be is victim Imaging for design purposes. Unique wood to a few people out there looks and mixed media looks as well as glass giving negative reviews,” he mosaics launched here. In laminate, board production was said. Mohawk is also providing its aligned dealers with expanded and proprietary technology increased to create new wood surfaces. Facebook content. “We are taking a hard stance Seth Arnold with The Captivator — the new on digital — it is a way we can Soft Surface destination display system for SmartStrand Silk. Mohawk reinforced its Good, Better, Best measure our marketing efforts. Dal-Tile completes Marazzi integration [Dallas] Dal-Tile Corporation, the largest manufacturer and marketer of ceramic tile and natural stone products in North America, has completed the integration of the U.S. business of The Marazzi Group, which was acquired by Mohawk Industries, Inc., Dal-Tile’s parent company, earlier this year. The combination brings together the four leading brands in the tile industry: Daltile, American Olean, Marazzi and Ragno; DalTile remains committed to providing its extensive product collections within each brand to tile and stone customers, through its three primary distribution channels across North America: company-owned stores, independent distributors and home centers. To support its approach of maintaining unique brand, product and distribution strategies, the company has implemented a new leadership and organizational structure. Gianni Mattioli, previously president and CEO of The Marazzi Group’s U.S. business, will serve as Dal-Tile’s executive vice president of marketing and R&D, and will have responsibility for Dal-Tile’s product strategy, brand marketing and product marketing. “With Gianni, we have added an excep- tional leader whose 30 years of industry experience and business acumen enabled Marazzi’s U.S. business to flourish,” said John Turner, Jr., president, Dal-Tile. “We are excited to have Gianni continue to execute his proven track record of delivering product innovation and customer service excellence across our industry-leading brands.” With the growth of the company’s brand marketing function, Lori Kirk-Rolley has been promoted to vice president of brand marketing for the Marazzi and Ragno brands in addition to her support of Daltile and American Olean. Correction Corrections · fcw122313pages.indd 4 FLOOR COVERING WEEKLY · The Karastan brand is known for its high-end wool carpets. structure by adding PET to the Wear-Dated brand, offering that mid customer a strong polyester option. The brand, which stands for quality and performance, will reach new products and price points, according to Mohawk executives. “Mohawk is the only manufacturer that offers products with 4th generation softness in all three categories, which is a huge opportunity for retailers to up sell their customers in the value category,” said David Duncan, senior vice president of marketing and sales operations. Wear-Dated Allure, for example, will undergo the new Continuum process. These products resist dirt, grime and contaminants and are made from 100 percent recycled content. “At every stage of carpet development — from the fiber technology to in-store merchandising — Mohawk continues to innovate, to lead, to invest in products and technologies that offer the greatest advantages for retail partners,” said Duncan. It was announced here too that Continuum was awarded its first patent. Another convention highlight was the unveiling of “The Captivator” — a 15 foot long display system for SmartStrand Silk that holds up to 40 styles. Seth Arnold, residential brand director, Continued on page 20 Jim Fanning will now lead the company’s home center and distributor sales segments as senior vice president of those functions. Within Fanning’s organization, Hector Narvaez has been named vice president of sales for Marazzi and Ragno brand distributors; he will also support Marazzi brand sales to key home center customers. Jon Shedlosky, vice president of American Olean distributors and Sandra Reilly, vice president of home center sales, will continue in their roles and also report to Fanning. Dal-Tile’s store operations, including its network of company-owned Daltile, American Olean and Marazzi Sales Service Centers (SSCs), will be led by John Cousins, senior vice president. FCW FCW FCW WWW.FCW1.COM FCW December 23, 2013 12/18/13 1:58 PM PORCELAIN L A M I N AT E Palisades in weathered ridge Sawmill Hickory in natural ADURA® Linea in graphite We took the next level to the next level. SOBELLA™ Majesty in dark forest HARDWOOD Lexington Hickory in mustang fcw122313pages.indd 24 mannington.com/residential 1-800-FLOOR-US 12/12/13 4:01 PM 6 Retailers report solid growth in 2013 to its Manhattan flagship store, ABC is not a typical carpet and rug dealer. Larry Chiprut, After years of yo-yo market conditions, floor vice president of ABC’s broadloom, said, covering retailers report that sales in 2013 “Broadloom did surprisingly well in 2013. The showed consistent growth. In its Floor Cov- stock market has done well and ABC is tied to erings Industry Quarterly Update, Catalina the stock market. We are up 10 to 15 percent, Research agreed, stating that U.S. floor cov- mostly from sales of higher end merchandise.” Location is key for its broadloom sales and erings sales (shipments minus exports plus imports) surged in the third and fourth quar- Brooklyn is a growth area, according to Chiprut, ters of 2013. Catalina estimated that dollar floor who said, “Brooklyn has taken off and lots of coverings sales increased by 7.6 percent in the people are moving there. We have done a lot of second quarter of 2013 and could have risen by town houses as older areas are being gentrified.” Having the latest and greatest is ABC’s speanother 6.9 percent in the third quarter. ABC Carpet & Home, the fifth largest floor- cialty and fueled sales in 2013. Chiprut said, ing retailer in FCW’s Top 50 Retailer report, “We had a lot of help from the vendors with new built its business on broadloom and rugs. introductions that make a statement in higher Now, operating three locations in addition priced goods — $150 to $250 a yard carpet.” Broadloom that is selling well includes Karastan’s SmartStrand products. “They have every style, fashion and density. It feels great and people love it. We are selling a lot of it to people who would have bought wool,” Chiprut said. Other star suppliers include Nourison, Dixie, Fabrica, Carousel and Robertex brands and Stanton. Rite Rug, ranked 6th in Rite Rug’s store in Dublin, Ohio offers a wide range of flooring. By Janet Herlihy FCW’s Top 50 retailers report, is based in Columbus, Ohio and operates 18 stores in nine states. Michael Goldberg, owner and CEO of Rite Rug, said, “We experienced growth from all segments of our business in 2013. Our builder division has had unprecedented growth in new markets over the last few years and we are expecting the same in 2014. Property management continues to take market share and retail is enjoying new found growth in hard surface categories as well as an increase in average ticket price due to the popularity of soft carpets and wood.” CAP Carpet Inc. based in Wichita, Kansas, and ranked 13th in FCW’s Top 50 Retailers report, operates 14 locations in four states. “2013 has been really good,” said Aaron Pirner, owner and CEO of CAP. “We did close some stores in St. Louis but overall same store sales are up in single digits,” he stated. A new store concept, The Floor Project, launched in the spring, has been successful. “We are looking to grow and expand it to other locations in 2014,” Pirner noted. “In terms of product mix, hard surface flooring continued to take share from carpet, but soft carpet sales did well, as did LVT and innovative wood styles,” Pirner reported. Porcelain and natural stone sales were also up at CAP. Nourison’s Nepal broadloom is performing well at ABC Carpet & Home. Correction Corrections Growth to continue in 2014 Chiprut is optimistic about the broadloom business in 2014. “The consumer is getting back to wanting to make their homes more comfortable,” he said. “Lately, the consumer has wanted rugs and carpet on stairs so we have done a lot of cut-to-fit, but we are seeing designers begin recommending more wallto-wall broadloom and that will be good for the entire industry.” Goldberg added, “Customers are looking for luxury products in all categories now more than ever. The soft carpets are hugely popular in both nylon and polyester as well as specialty hard surface items.” Despite concerns with the political climate in the U.S. and uncertainty with the world economic outlook, Pirner is also generally optimistic about 2014. He said, “We expect to grow in the low single digits and are budgeting for more than that. We expect a down tick in housing but continued growth in the remodel segment.” FCW FCW FCW 2013 Industry Report State of the Continued from page 1 structural needs of our distribution network,” said Merritt. “As a result, we are investing $55 million to streamline our distribution network and add an additional 535,000 square foot expansion in Dalton. These changes will allow us to more effectively service customers, increase roll and pallet capacity and improve efficiency. We are working hard to ensure our distribution and logistics teams are prepared to service increasing demand in both carpet and hard surface in the most efficient manner. And we are working to insure we are prepared to service the expanding product demands, not only in the United States but also globally. All this has required focus, preparation and additional investments.” Workforce — finding, training and retaining the right people — too has been an industry-wide issue. Merritt added, “We are working hard to better train not only our current associates, but our future workforce via a joint effort with the Governor’s Office on Workforce Development, the Northwest Regional Commission, Georgia Northwestern Technical College and other manufacturers to create the Fast track Innovation Program — a unique 10-week training program to help meet the manufacturing industries’ employment needs.” The two areas that continue to plague the industry from a consumer perspective and potentially a construction perspective, according to Mohawk’s Lape, “are, one, job and income growth and, two, Washington. The uncertainty of government shutdowns certainly is not helpful for discretionary consumer spending or the markets. The continuation Kevin Biedermann Kim Holm Tom Lape Randy Merritt Mannington Mohawk Shaw of income rates, although slug- Armstrong gish to date, we believe can only At Armstrong, despite the economy over improve from this point forward,” he explained. demand in the Asian market. “With two-thirds For manufacturers of hardwood, shortages of the world's carpet tile sold outside of North the past several years, the company will not and rising raw material pricing still threaten America — the majority in Asia — our new cut investments being made in what makes it the rebound of that market. “The low for us plant expands our opportunity to participate in successful such as “fulfilling our brand promise, new products, quality and programs that drive was the availability and cost challenges of logs this growing market,” explained Merritt. The company also expanded its existing profitable sales,” said Biedermann. for our hardwood business. This issue started He also noted that Armstrong continued in late 2012 and continues to challenge us as Cartersville carpet tile facility to its maximum we go into 2014,” said Mannington’s Holm. and announced plans for a new $85 million to “take the high road in product design, Biedermann at Armstrong said, “For all carpet tile facility in Adairsville, Ga. Shaw is launching upscale American-made genuine manufacturers, the cost of raw materials con- investing $55 million to streamline its distri- scraped woods as well as commodity-busting tinues to rise at an extraordinary rate. Despite bution network and add an additional 535,000 laminates and LVT in a multitude of interchangeable and customizable sizes.” In 2013, the challenge, Armstrong is positioned to square foot expansion in Dalton, he said. Other investments include $45 million to Armstrong rolled out 20 new SKUs of lamleverage our scale to ensure a profitable cost/ value proposition for retailers and consumers.” expand capacity within Shaw's existing extru- inate and “redefined what constitutes highsion facility in Dalton and the company pur- end design within the category,” he added. Both Mohawk and Mannington made chased an adjoining piece of land for future Investments meet new demand With an eye on growth, Shaw made a expansion. Another $40 million investment substantial investments in their manufacturnumber of key investments this year. It opened will help Shaw meet the growing demand ing this year as well. (See December 9 issue of its 210,000 square foot carpet tile facility in for its Epic engineered hardwood product by FCW for more details about all major indusNantong, China which addresses growing expanding the South Pittsburg, Tenn. facility. try investments.) FCW FCW Correction Corrections · fcw122313pages.indd 6 FCW FLOOR COVERING WEEKLY · FCW WWW.FCW1.COM FCW December 23, 2013 12/17/13 1:05 PM BEIGE BLAH Color Hoorah Tired of offering your customers the same shades of beige? Let color reign for the new year. Coming January 2014 style & design to dye for! by FLOORS shawfloors.com fcw122313pages.indd 26 12/16/13 12:34 PM 8 Laminate Deflationary conditions impact laminate help mitigate costs. The other, Kelley noted, is to provide products that will allow conWhile market conditions continue to improve sumers to move their preference upstream throughout the country, the laminate category and away from basic commodity laminates. Most manufacturers also noted that one of is still impacted by many challenges. And as some of the smaller laminate suppliers con- the biggest challenges to the category contintinue to fall by the wayside, for the leading ues to be low priced imports. Mannington’s manufacturers 2013 was about responding to response is to focus on the high end. “We have pretty much abdicated the lower these challenges and rising above. According to George Kelley, CEO of Krono- end of laminate and are letting the imports tex USA, the challenge continues to be fighting duke it out with some of the larger manufacoff the same deflationary conditions that have turers that still play in lower end laminate,” said impacted laminate for years. “The fact remains Dan Natkin, director of wood and laminate at that external raw material costs have risen and Mannington. “Our focus is on the style and quality of upper end laminate.” our prices have not kept pace,” Kelley said. Paij Thorn-Brooks, vice president of brand One key focus that Kronotex has taken on this year is its investment in paper treating to marketing at Unilin, agreed that Chinese imports have created a more challenging environment for domestic manufacturers, and continued to do so in 2013. “However, one very important point to consider is that the Chinese presence revolves predominately Paij Thorn-Brooks Drew Hash Milton Goodwin around price. This gives Unilin Shaw Armstrong By Brittany Walsh Schönox ZM Smoothest top surface in the industry. ZM Rapid Install flooring in 2 hours. * *See technical data sheet for full details. domestic manufacturers the opportunity to lead in the other product attributes important to consumers,” she said. “During 2013, the non-price features weighed more heavily during the consumer’s selection process than in the past few years.” Touting inherent attributes Some industry insiders told FCW that the 2013 laminate market continued to be eroded by strong sales of luxury vinyl tile (LVT). However, domestic manufacturers noted that projecting laminate’s Made in America story, as well as its numerous environmental attributes, helped boost laminate sales. Mannington finished with laminate imports this summer and now proudly touts that its laminate is 100 percent made in the U.S. “Our core values have always been in American manufacturing. This year we were finally able to say that all of our laminate has been onshored,” said Natkin. Kelley at Kronotex strongly believes that domestic manufacturers need to champion the message that U.S. manufacturing integrity ensures that companies are being environmentally responsible. “Our manufacturing plant keeps up with Schönox AP with dust-reducing properties. schönox Subflooring Products- Smoother, Faster, and safer. Schönox subfloor products allow projects to be completed faster addressing tough subfloor issues with the most efficient use of installation time. Our Schönox AP self-leveling compound has special dust-reducing properties that support a cleaner, safer project. That’s just the start of a product line up that includes important characteristics like no VOCs, recycled product content, faster more ergonomic application techniques, and significant contributions to LEED credits. Visit us at Surfaces in Booth B3837 and let’s talk about the smoother, faster, safer solutions that can assist in your next subflooring project. George Kelley Kronotex the latest technology to ensure air and water quality. This is done because it is the right thing to do and is done at cost to our bottom line,” Kelley noted. Laminate products that meet and exceed indoor air quality requirements are continuing to become more of a differentiation point with consumers, especially as they compare to imports, manufacturers said. Many executives referred to commercial initiatives in 2013. Some of Mannington’s bigger pushes this year were around builder acceptance, Natkin noted. Thorn-Brooks at Unilin added that 2013 came with a substantial amount of pent-up remodeling demand from which the flooring industry in general, including laminate, benefitted. Optimism around the upper end Milton Goodwin, Armstrong vice president of wood and laminate, feels his company leads in terms of bringing innovation to the market. “We try to stand apart in the category in that we continuously try to introduce new innovations,” he said. Goodwin pointed out multiple width planks in a single box to produce unique and different flooring options for the consumer, as well as cross-cut graining and the company’s focus of designing unique and authentic visuals. “We brought products to market this year that most, if not all, of our competitors would be challenged to make. So far, we are very pleased with the progress we have made in 2013.” Goodwin also noted that this year, Armstrong has added approximately 20 new SKUs in the high-end design laminate category. Key product introductions, he said, included antique structures, white wash products, and the company’s Architectural Remnants collection continues to bring success. Natkin noted that Mannington focused on adding smaller display units to better feature its high-end products. Drew Hash, hard surface category manager at Shaw, said there is always some pressure from other categories and potentially losing share. But, he said, “The way we came at that was by making better looking and better quality products. In the simplest terms, we just focused on making laminate better texturing, style and design wise. This year we made some great strides with our laminate visuals. We’re happy with where we took our market offerings this year and are excited with where it is going.” FCW Correction HPS North America,Inc. The Schönox Provider Toll Free: 855.391.2649 www.hpsubfloors.com · fcw122313pages.indd 8 Dan Natkin Mannington FLOOR COVERING WEEKLY · Corrections FCW WWW.FCW1.COM FCW FCW December 23, 2013 12/17/13 1:07 PM 9 Strategic Insights view (POV) and narrative. Ensure every from Krystal to The Ritz-Carlton. The key to success is adding your POV touch point is about your brand. Make the product secondary to your brand. People and narrative with a sense of excitement BY CHRIS RAMEY are emotional; not rational. Leverage that 95 and “over the top” distinction to your store. percent of the flooring is indistinguishable Dump everything that is outside your POV. from other products to a consumer. A unique It takes discipline and vision, but the future POV may be as simple as leveraging color. Or belongs to those who execute. it could be owning a certain “look” or style ___________________________________ ne of the buzzwords in business promise less and they deliver less, and the of rugs. Scandinavian furniture stores don’t Chris Ramey is a keynote speaker, trainer and show traditional furniture for a reason. But, consultant. He is also president of The HomeTrust is “experience.” It seems everyone customer is happier. if you wanted that “look” then you’d only and Luxury Marketing Council Florida. Ramey wants to call visiting their showroom go to a Scandinavian store. They succeed has over 30 years’ experience in floor coverings. an experience. I visit a lot of showrooms What can you do? Take a trick from the luxury segment. because they have a POV and the discipline He resides in Miami and welcomes your comacross dozens of categories, and I have a lot of experiences. Very few of these visits are Infuse your store with your own point of to manage it. Ditto for every successful brand ments at cpr@affluentinsights.com. good experiences. And then recently in New York City, I heard an owner of a famed floor covering showroom end his presentation with, “Visiting X (his showroom) is an experience.” A person sitting at my table starting laughing at the thought. Even my Fresh Market in Coconut Grove has a sign on their front door that reads “Experience the Food.” C’mon, really? You want me to experience the food? “Experience” has been hijacked by marketers who believe it will become true if they say it enough. It joins a cadre that includes “quality,” “luxury” and “service.” If you have to say it then it probably doesn’t exist. Worse, everyone says it. And everyone lies. So there’s no distinction from competition. That makes it irrelevant. So, please stop saying it. Experience should not be confused with “experiential.” Consumers desire things that are experiential. I work with many clients on what we call “Surprise & Delight” programs. Programs/services that can’t be bought. We may invite Northern Trust clients for a night cruise on a Ferretti Yacht, or a private event with Sting. In the restaurant business, they refer to it as an amuse-bouche. Today, great service is the cost of the entry. The question you should be asking yourself is “how can I ‘surprise and delight’ my clients?” Victoria’s Secret recently promoted a $10 million bejeweled bra. And Neiman Marcus will promote something “over-the-top” for its Holiday Catalogue. Trust me on this: beige bores everyone. Beige (the best-selling color) is the default when you haven’t done your job. Customers are the core of your business — not beige product. Most of the things that fascinate a product specialist, like most of those in floor coverings, mean very little to your clients. They aren’t buying what you’re selling. At GE Capital, we understand your commitment to helping homeowners—getting the right And they aren’t judging your store against flooring for their project and their budget. Just as homeowners trust and respect your expertise, your specialty store competitors. They will you can rely on GE Capital’s special financing solutions to help you build long-term relationships. judge you against their collective experiences — which likely includes Neiman Marcus, Together we’ll provide trusted solutions and great flooring. Because getting it right really matters. Apple, Marriott and home centers. As a specialty store they will expect you to be consisStop just banking. And start building. Enroll today by calling 1-866-209-4457. tent with their expectations; today that means Apple and Nordstrom. They’ll expect less at a home center and the home center will deliver less. So it isn’t about who is best; it’s about imagination at work who matches expectations. It’s a paradox. Home centers deliver what they promise and Credit is extended by GE Capital Retail Bank they meet their customer’s expectations. It’s © 2013 General Electric Company. All Rights Reserved. the same reasoning that Southwest Airlines keeps winning awards for great service. They Good and Evil O GE Capital LIKE A BANK: We provide your customers a way to pay. UNLIKE A BANK: We help you share your expertise and build lasting relationships. 021190_Flooring_FloorCoveringWeekly_LikeBankCarpet_7_735X9_125_0413.indd 1 December 23, 2013 fcw122313pages.indd 9 WWW.FCW1.COM · FLOOR COVERING WEEKLY · 4/11/13 10:56 AM 12/17/13 1:07 PM 10 Laminate Quick-Step takes pride in distribution together and work closely with the retailer as well, that is what makes a great successful relaWith 15 distribution partners across the tionship. It’s amazing some of the things we country, Quick-Step takes pride in acknowl- have discussed and how many things actually edging the crucially important part inde- have come to fruition.” pendent distribution plays in the company’s Strengthening relationships at retail continued success. The Quick-Step brand is currently carAnd what Quick-Step believes to be one of the most integral pieces in maintaining ried by approximately 95 percent of the top a strong and successful relationship with 50 retailers as reported by Floor Covering its partners is simple. According to Shane Weekly (FCW) this year, according to Unilin. Calloway, vice president of North American The company feels that partnering with the independent distribution at Unilin, one thing right distributors is a key factor in initiating its partners appreciate is the company’s ability an audience with these top retailers. “These distributors have developed treto listen to needs at the distributor level. “We are big believers in listening to our mendous relationships at the retail level that advisory council,” said Calloway. “We believe have been formed over the last 20 to 30 years that if we listen to their input, we can actually on average,” said Calloway. “They have a very make some of those things happen for them seasoned and tenured sales team through disand it helps to drive our business. It also tribution, so partnering with the right network makes our relationships with our partners has made us much more powerful.” Calloway also noted that distributors even stronger as well.” Rich Kearsley, senior vice president of sales know their markets very well and have keen at Elias Wilf, said the way the Quick-Step team insights into what will work for the specific listens to input from distributors is extremely audience in their region. valuable. “I think because of that, we have been able to establish a relationship of trust with Benefits of distribution model While some manufacturers are turning to them,” said Kearsley. “When you collaborate By Brittany Walsh a direct approach, Quick-Step believes strongly in the success of its independent distribution channel. Calloway said the coverage that its distributors provide is second to none. “Sometimes going direct takes a little longer and you’re forced to figure out how to make it work. Our distributors are very quick and flexible with moving product,” added Calloway. Craig Folven, vice president at Herregan, said that one thing Rich Kearsley of Elias Wilf accepts Distributor of the Year that makes Quick-Step a valu- award from members of the Quick-Step team. able manufacturing partner is “A few times a year they offer us the opporthe understanding of a “true partnership.” “[Quick-Step] knows that they are a tunity to speak and offer input,” said Kearsley. strong manufacturer and they believe in us “They bring representatives from some of and our abilities as a strong distributor. We their partners together a few times a year and are able to feed off of each other in order to competitiveness is checked at the door. The forum is an opportunity for us to learn from be successful,” he said. each other so that we can all benefit.” According to Quick-Step, the council acts Positive focus on the future One thing Quick-Step distributors noted as a means of communicating what the comas an important tool in maintaining a suc- pany and its partners have achieved since the cessful relationship was the Quick-Step Dis- previous year’s meeting. tributor Council. Continued on page 12 We give you everything that’s important to consumers, including social media and product education, so you can close more sales. · fcw122313pages.indd 10 FLOOR COVERING WEEKLY · WWW.FCW1.COM December 23, 2013 12/17/13 1:06 PM Resilient 11 Addressing continued growth, expansion comes with a cautionary note. “It’s the same just price. “The challenge lessons the industry learned from the laminate lies in the flooring industry As the year draws to a close, resilient manu- craze many years ago,” Train said. “Many being able to keep consumers facturers reflected on the positive changes and companies will join the bandwagon, but you focused on value and not growth of the category. Across the board, sup- have to stay true to your core competencies.” primarily price,” said Kevin Biedermann, Armstrong pliers said the year was a tremendous success Flooring Products’ residenand they expect the growth to continue well Addressing the challenges Another key strategy has been to train tial senior vice president. into next year. But while they remain buoyantly optimistic, they also plan to examine both the retailer and the consumer to focus “This category provides treContinued on page 12 Xavier Steyaert, IVC US hurdles and lessons they learned over the year on the quality and value of resilient and not to better improves their business next year. IVC US had another strong year, said Xavier Steyaert, Co-CEO, because the company focused on growing its customer base. “Despite a maturing sheet vinyl market, the nice growth we experienced in this segment was fueled by a combination of success in our traditional channels and also into new channels,” he said. IVC US expanded beyond traditional retail and distributor to property management and multi-family housing markets, and even the RV industry. Expanding its distribution Karndean LooseLay is an innovative new format of LVT also meant expanding its distributor netthat’s quick and easy to install. Ideal for commercial and work, which also contributed to its growth. residential environments, its friction grip backing holds the Russ Rogg, president and CEO of Metroflor Corp. echoed the sentiment and is product in place; no clicking, no locking. grateful that the year was completed without any major crisis. “Fortunately, we did not meet any significant obstacles this year. Our business remains strong and we anticipate that this level of growth will continue for the foreseeable future.” The key to that, he noted, is continual innovation and new product development. Emil Mellow, vice president of marketing for Karndean Designflooring US, noted that “2013 has been a tremendous year for growth of the overall US Karndean business. The challenge in a growing market is keeping up with demand.” By Sharyn Bernard Ed Duncan, Mannington Mills No slip. Just grip. Increased LVT demand One of the biggest drivers in 2013 was the increasingly strong demand for LVT products. “A key focus for us this year was keeping up with the incredible, continued growth and demand in the rapidly changing LVT market,” said Ed Duncan, senior vice president of residential marketing for Mannington Mills. “Early in the year we had a major product line expansion which was very successful.” Added Jonathan Train, vice president of product development for EarthWerks, “LVT has taken off and the economy is growing again.” That demand creates its own challenges, he noted, particularly in keeping up with stock and inventory.” Mellow at Karndean said they, like others saw explosive growth in the category. LVT sales grew across the board, he said, noting that the company’s premium business performed well this year, but along with that the company had to focus on merchandising tools, inventory and customer service. Still, the issue with such explosive growth December 23, 2013 fcw122313pages.indd 11 WWW.FCW1.COM Karndean LooseLay · LLP95 Ashland - Available in January 2014 FLOOR COVERING WEEKLY Call: 888-266-4343 Visit: www.karndean.com · 12/17/13 1:06 PM 12 Resilient Expansion Continued from page 11 mendous value to a consumer.” There are other key elements that drove the business and that will continue to impact the market. Some of these are out of the manufacturers’ control but are critical, nonetheless. “The lesson I learned this year is that there are external issues we can’t control,” said David Reichwein, president and CEO of FreeFit. These include macro views of what’s going on globally, from geopolitical factors to domestic issues. “We can control costs, quality, new product development. We do our best but are impacted by outside forces,” such as a meltdown in the EU, a debt crisis or a wildly fluctuating interest rate. In addition, he said an often overlooked but critical aspect is intellectual property protection. “The industry level of intellectual property awareness could be improved. It surprises people. I warn people all the time Kevin Biedermann, Armstrong David Reichwein, FreeFit Glen Hussman, Tandus-Centiva that a lot of problems could be avoided if people educate themselves on intellectual There were other lessons learned and sure it has the right structure for each channel. property law.” challenges faced. Rogg of Metroflor “There is not a one size fits all,” Reichwein said. Tandus-Centiva launched a number of prodacknowledged that the company learned that having too many new products and ini- ucts and will continue to expand both lines. tiatives can have unintended consequences. “We experienced very robust growth and it’s The firm launched the most new products forcing us to get better and stay competitive.” Armstrong focused extensively on realin its history — from LVT to other lines — and while that is positive, “it was a lot istic designs and will continue that trend. to manage at one time,” Rogg said. “We “Certainly the trends continue to be all about will be committed to a more sequential color and design; however, the realism is launch of new products in the future so that what truly differentiates the resilient products something fresh is hitting the marketplace for the consumer,” Biedermann said. Other consistently during the course of the year.” major initiatives included new shapes and Some changes in the market have been sizes to its LVT lines. Manufacturers agreed that while there has unique to specific companies, such as Tandus-Centiva’s purchase by Tarkett. “This been sustained and long term growth in the has been a year of dramatic change,” said category, and while they expect it to continue Glen Hussman, president of Tandus-Cen- into the next year, suppliers need to proceed tiva. “The change of ownership has been a with caution. “There is no quick path to succhange on steroids for us.” But, he added, cess,” Biedermann said. “Tried and true the changes enabled all parties to focus on products and programs continue to perform, their strengths and grow all their businesses. and that means great products that consumers “We’ve had a lot of wind in our sails, and want to buy, well-trained sales associates and I think going forward we will continue distributor partners that can provide support to focus our energies on how to bring a — the model works.” FCW FCW multi-surface solution.” FCW FCW Correction Corrections Expanding product lines All this activity leant itself to a spate of new products and new lines across resilient categories, notably, unsurprisingly, in LVT and locking systems. FreeFit expanded its line to take advantage of economies of scale while also examining its distribution network to make Emil Mellow, Karndean Quick-Step Continued from page 10 Exceptional design deserves exceptional flooring. Simple yet sophisticated or playful and bold, Centiva has limitless options to complete your design vision. From ease of installation to extreme durability, low maintenance to a great looking product, you can choose Centiva with confidence. FLOORING SHOWN European Cherry WP 3307-E 1 • 888 • CENTIVA centiva.com “We go through 2013 and discuss all of the positives and negatives. What needs to be fixed on the negatives and how we can expand on the positives. And most importantly we talk about where we’re going,” said Calloway. “Where we’re going entails first and foremost products, product innovation and what we’re looking to launch in the coming years.” By involving its distributors in the brainstorming process, Quick-Step believes that not only do distributors have their voices heard, but also allows the company to better equip them with new marketing opportunities at the retail level. “When it comes to marketing and mer- Jonathan Train, EarthWerks chandising, nobody does it better than Paij Thorn-Brooks and Quick-Step,” said Kearsley. “They provide a great blend of technology, new and old. And none of the products we sell are offered at home centers. These things you can’t really put a price on when you need to market a brand.” Folven noted that Quick-Step provides its partners with a total selling package of complete merchandising units, great representation, a great brand name and is well advertised in the trades as well as to the consumer. But according to Kearsley, the bottom line comes down to trust. “We like to work with people that we can trust,” said Kearsley. “And when you pair that with people who work as hard as you do, it makes for a very successful relationship.” FCW FCW Correction Corrections · fcw122313pages.indd 12 FLOOR COVERING WEEKLY · FCW WWW.FCW1.COM FCW December 23, 2013 12/17/13 1:06 PM fcw122313pages.indd 26 12/16/13 10:49 AM 14 Wood Demand, price define 2013 market By Mallory Cruise 2013 has proven to be an active year for the hardwood market. Though sales were up this year, and the market continued on a growth pattern, rapidly rising raw material prices, a limited lumber supply plus growing consumer demand have all resulted in a number of challenges for the rebounding hardwood industry. Two combined key factors characterized the hardwood market this year, according to Dan Naktin, director of wood and laminate business at Mannington. Demand continued to grow, he said, despite unprecedented raw material price increases. “The category gains were due to con- Kevin Thompson, Shaw Wood shows strength As far as volume is concerned, 2013 marked a solid year for the hardwood market, noted Milton Goodwin, vice president of product at Armstrong. Rick Knowles, Anderson “We saw the dam break from a growth Harry Bogner, Unilin and sales standpoint, and every segment of the market has been better. Sales are up, costs housing starts and remodel. “We are seeing strong growth in not only the are up — those would be some things we saw in 2013 and will continue to see through the builder market but in the remodel sector as well. And, housing starts have also greatly improved. remainder of the year,” he said. Kevin Thompson, hardwood category man- We are also seeing some significant regional ager at Shaw, attributes the rebounding market growth throughout the country,” he said. Brian Greenwell, vice president of sales and growing builder market as the key factors and marketing at Mullican, noted that these defining the wood industry. “Finally, we’re seeing a consistent market increases in raw material costs left an indelible rebound fueled by a strengthening new home mark on the hardwood industry in 2013. “Raw material prices escalated at an astonconstruction market. Also, the unprecedented raw material ishing rate, and manufacturers had no choice price increases that are pri- but to increase prices to stay ahead of (or marily impacting solid have even with) raw materials,” he said. also had a big influence on the Challenges persist wood industry,” he said. While sales indeed are up, the wood market Rick Knowles, vice president of sales and marketing at Ander- faces a number of challenges. Unfavorable son, agreed, saying other key weather throughout the year, coupled with drivers characterizing the wood increasing consumer demand, has resulted in Milton Goodwin, Armstrong Brian Greenwell, Mullican market undoubtedly include the rise of raw materials prices. Greenwell at Mullican noted, “The biggest challenge was balancing demand with increased raw material costs. Manufacturers had to increase production while trying to manage lumber inventories and not drive prices even higher,” he said. Goodwin at Armstrong explained that the availability of lumber ebbs and flows with the market, which has proven to be a major challenge for the hardwood industry. “We saw challenges in the availability in lumber. We had a wet spring and a lot of snow in the winter — it was difficult for the loggers to get into the forest. Loggers were able to cut trees and fill up log decks in the summer. Now everyone is holding their breaths hoping we don’t have a bitter winter. If that happens, it’ll make the logging season shorter which will reduce the availability of raw materials in the marketplace,” he said. He also noted that the flooring industry is competing with other industries when it comes to wood procurement. Another challenge, said Knowles at Anderson, is anticipating and planning for the increase in demand on the manufacturer side. “Many things have to happen up front. We have to plan for capacity, raw material supply and some long term processes to be able to stay in front of everything,” he said. tinued upward movement in both the new home construction and remodel markets. Consumers still make hardwood the ‘flooring of choice,’ which drove improved demand throughout 2013,” he said. Hardwood flooring manufacturers industry-wide had to raise prices on their finished goods, in response to increased lumber costs during 2013. That, said Harry Bogner, senior vice president of hardwood at Unilin, had a significant impact on the wood market. “The increased cost of lumber was something out of the control of manufacturers. These increases were heavily driven by shortages in lumber due to wet weather in logging areas, increased demand, shortage of loggers and lack of adequate saw mill capacity,” he said. Dan Natkin, Mannington The year’s bright spots Industry executives agreed that the housing market was, and continues to be, a huge driving factor of the hardwood industry in 2013. Additional bright spots include market growth, improved demand and increasing sales. Armstrong, for instance, added crews to Continued on page 16 · fcw122313pages.indd 14 FLOOR COVERING WEEKLY · WWW.FCW1.COM December 23, 2013 12/18/13 11:33 AM ©2013 Shaw At the intersection of design and performance. Beautiful, durable, brilliant, resilient. We put our newest resilient collection to the test at a renowned crossroads of American life—Grand Central Terminal—to show that 5th & Main™ is at the intersection of design and performance. See it at our winter market events—contact your Shaw Hard Surface Territory Manager for details fcw122313pages.indd 24 5thAndMain_TeaserTradeAd_FCW.indd 1 shawfloors.com 12/16/13 9:40 AMPM 12/12/13 5:26 16 Wood Executives report a growing industry FCW talked with industry executives to iden“The housing market showed new signs of tify key reasons for this year’s market growth. life, and demand increased at the distribution Here is what they had to say: level for the first time in a while.” — Brian Greenwell, vice president of sales “Despite raw materials driving price and marketing at Mullican increases in the market, hardwood continues to be a flooring type that consumers aspire to “The industry is in growth mode because have in their homes.” wood is a popular product. Consumer con— Dan Natkin, director of wood and lami- fidence is good and coming back strong. nate business at Mannington Measuring consumer confidence, there’s been should be better than 2013. As the economy improves, the expectation is that new home construction will increase and subsequently drive more demand for hardwood flooring. periods throughout this year when confidence Residential/ remodel is expected to also grow.” — Harry Bogner, senior vice president of has declined but relative to when you look at confidence to last few years, that confidence in hardwood at Unilin the housing market has improved. The fore“The wood market is back to growth again seeable future looks bright for our industry.” — Rick Knowles, vice president of sales and due to an improved housing market and a rebounding retail market fueled by residenmarketing at Anderson tial remodel and replacement.” — Kevin Thompson, hardwood category “Economic indicators point to continued recovery. For the hardwood category, 2014 manager at Shaw Correction Corrections “The hardwood industry is being driven by new housing starts and remodel, and both are going up. It’s a growing business, and it’s very competitive, but it’s definitely up.” — Milton Goodwin, vice president of product at Armstrong FCW FCW FCW Demand FCW Continued from page 14 its facilities in order to meet rising demands. “We’ve added crews in just about every plant in the U.S. and around the world. Hiring to keep up with demand is always a good thing. We’re experiencing growth with our products and we’re very excited about where the future lies for us,” Goodwin said. For Shaw, one particular bright spot is produced-based as the company’s Epic product line has been doing very well. “We’re experiencing continued phenomenal success with our Epic hardwood product line with high double-digit growth and the announcement of a $40 million expansion,” said Thompson. A changing consumer preference for certain types of wood products has been another positive, according to Natkin at Mannington. “Consumers appear to be moving back towards more premium products and not just focusing on the entry level. For example: wide width, long length and hand distressed products are growing rapidly in demand,” he said. “Despite raw materials driving price increases in the market, hardwood continues to be a flooring type that consumers aspire to have in their home.” Knowles at Anderson agreed, adding that while more consumers are specifically buying higher-end goods, they are also directing their focus on domestically produced products. “We are seeing an improvement in better goods sales. People are feeling more confident and it seems to be gaining momentum. There’s also a movement of products moving back to the U.S.A. People are looking for reduced lead times, which has helped to facilitate this movement,” he said. Added Bogner at Unilin, “Considering all that the industry had gone through with the economic downturn and the length of the recession, it was encouraging to see how well hardwood flooring began rebounding,” he said. FCW FCW American ENGINEERED HARDWOOD HILLSHIRE LINCOLNSHIRE PONTE VEDRA SAN MARCO Since 1985, Mullican Flooring has taken great pride in offering the highest quality Hardwood Flooring in the world. As a privately held American company, we are big enough to handle all your Hardwood Flooring needs, with no committees, no focus groups, and no corporate red tape to hinder our decision making process; we are quick and nimble enough to provide Real-Time Service in your Real-Time World. And now we are proud to offer this New Collection of four American-made 3/8-inch Engineered Hardwood Floors. Hillshire provides a versatile array of colors to suit any taste, while Lincolnshire offers a beautiful selection of Hand Sculpted colors. Ponte Vedra is America’s first domestically-produced Engineered Hardwood Floor to feature 6-inch widths, and San Marco offers 6-foot lengths in a wide variety of Hand-Sculpted selections. With four state-of-the-art U.S. Manufacturing Facilities, Mullican Flooring is committed to the production of the finest American-made Hardwood Floors that are perfect for any setting, any climate and any dream. ® MADE IN THE USA Correction www.mullicanflooring.com 1-800-844-6356 · fcw122313pages.indd 16 Corrections FLOOR COVERING WEEKLY · FCW FCW WWW.FCW1.COM December 23, 2013 12/17/13 1:08 PM If tIle + stone Is your busIness, Coverings is your show iT’s siMple. for The pAsT 25 yeArs, Coverings hAs been foCuseD on you, your business AnD your suCCess. iT’s why we proviDe iT All for free: ACCess to tile + stone manufacturers from across the globe to see, touch and feel their new products and lines Top-noTCh conference sessions to educate your entire team to garner more success in today’s competitive marketplace opporTuniTy to connect with 20,000 other industry professionals to share ideas and increase sales Not only does Coverings bring you the world of tile + stone, but it also invests the proceeds from the show into advocacy, standards, education and promotion for the industry. your suCCess is our business. finD ouT More AnD regisTer now for free AT Coverings.CoM. Please use VIP Code AFCW4 when registering. April 29–MAy 2, 2014 las Vegas yeArs Coverings.CoM ConneCT wiTh Coverings 11-25-13pages.indd 24 25 neVada, usa for The inDusTry — by The inDusTry 11/18/13 1:21 PM 18 Carpet & Area Rugs 2013 residential carpet buoyed by housing trends omy and the attitude of the consumer. Ralph Boe, co-CEO of Beaulieu, explained, “There As housing goes, so goes the residential are government issues such as the Affordable carpet business and 2013 was a good year for Care Act and concerns about where interest housing. Rising consumer confidence led to rates will go that have created a lot of uncerconsistent 25 percent gains in housing starts tainty. Better goods are selling, but mid-level price points are soft.” and existing home sales Base grade carpet, used rose more than 10 percent in both multi- and single each quarter into the third family units has been quarter, according to pretty strong, Boe added. Catalina Research. Tom Lape, Mohawk’s Carpet is still fighting president of residential for share because changing flooring, said, “We look consumer tastes are resultback on 2013 as a year ing in more hard surface of transition, as the flooring being chosen in economic recovery conthe residential replacement tinued to gain firmer and market. Carpet and area firmer footing throughrugs’ share is estimated out the year.” to have declined to 50.9 Timeless Charm II is a Shaw Soft Mohawk expects pent percent in dollars and 55.7 Shades carpet made of Anson nylon. up demand to break percent in square feet in the third quarter of 2013, according to Catalina. loose. “Our 2013 trend analysis indicates that Still, the report tallies carpet and rugs dollar consumers have begun to respond to this sales (shipments minus exports plus imports) repressed demand by purchasing and renofor the first three quarters of 2013 up 4.2 per- vating their homes with new soft floorcovercent with a 2.9 percent gain in square foot sales. ing,” Lape reported. By Janet Herlihy response is innovation through advances in soft fiber technologies across all major fiber categories,” Lape said. Such advances include Mohawk’s new Continuum process soft polyester that will keep the company at the forefront of the segment, he added. For Invista, the greatest challenge was insuring sustainable growth even though the economy was sluggish, according to Dan Haycook, executive vice president, Invista Surfaces. “Innovation, in all aspects of our business, was our core driver in people, R&D and social media,” Haycook said. Steve L. Griffith, CMO, Invista Surfaces, added, “Our challenge was to create innovation and marketing for products such as Stainmaster PetProtect, which answers a specific consumer problem that is not about price. Our research has shown that only 20 percent of consumers are primarily concerned about price. That means that 80 percent want other things,” he stressed. Successful carpet launches Shaw focused on soft carpet in 2013, according to Trey Thames, Shaw’s residential vice president of marketing & product. “Offering soft carpet products was definitely the biggest initiative of 2013. We expect this to continue in 2014 and beyond. It has demonstrated that consumers will pay for innovative new products. Soft has helped raise the average net selling price and created excitement around carpet,” Thames said. Lape stated, “Mohawk now offers the Challenge: Something new Growth in better goods, builder qualities Residential carpet must court the consumer widest array of next-generation soft styles of To understand the state of the carpet industry, look first to the overall U.S. econ- with stylish and relevant products.” Mohawk’s anybody in the residential carpet industry.” Mohawk’s EverStrand Soft Appeal made with recycled content from PET beverage bottles, features soft polyester fiber. Seeking to deliver meaningful benefits to the consumer, Beaulieu launched Bliss Indulgence, a solution dyed soft nylon, along with updates to Magic Fresh (with odor reduction) and HealthyTouch with Silver Release (an antimicrobial). To jump start Indulgence, Beaulieu put together three promotional components, according to Boe. “We got involved with the March of Dimes and linked that to Indulgence. We also launched the Spa Sweepstakes Program that offered a chance to win a vacation and other prizes. We got the consumer’s attention and then reached out to RSAs (retail sales associates) with our American Express program.” In 2013, Invista launched Stainmaster brand extensions TruSoft, SolarMax (fade resistant) and most recently, PetProtect, which are all in store and being sold right now. “It is key to be ready to sell in spring 2014,” stressed Griffith. FCW FCW Correction Corrections FCW Commercial carpet spotty in 2013 After being the bright spot in the carpet industry from 2010 through 2012, specified commercial saw only modest gains in 2013. “Government spending cuts — federal, state and local — slowed many public projects,” said Stuart Hirschhorn, director of research for Catalina Research. “However, hospitality is doing well and private office projects are somewhat better as well,” he noted. Supply everything, everywhere—quickly Clients are asking for more, according to Brenda Knowles, Shaw’s vice president marketing & product development - commercial division. “Commercial customers are increasingly looking for suppliers that are true partners Mannington’s Connected Collection includes five patterns in 16 colors. bringing to the table a full range of solutions across product categories,” Knowles said. Globalization was another challenge Shaw answered in 2013. Knowles added, “Our market research has shown demand growing across the globe, so we have increased our capacity to provide service and support across all regions of the world,” Shaw’s new carpet tile plant in Nantong, China will enable the company to better serve the growing Asia Pacific market. For Mannington, delivery speed became a challenge. Jack Ganley, president of commercial, explained, “Clients have gotten the design work done but then there’s a delay for a variety of reasons. When the OK comes, it’s a rush that has shortened average delivery times. What used to be five to seven weeks (for delivery) now is either immediate delivery or three to four weeks. We have done a lot in the plants to allow things to move faster. We have added staff and some machines are now running 24/7.” Tandus Centiva dealt with change “on steroids,” according to Glen Hussman, president of the newly merged company. “With new ownership (Tarkett) and a merger with Centiva, Tandus Centiva still outperformed the industry in its traditional businesses,” Hussman said. Lessons Learned Ganley stressed, “Uncertainty is the new normal. You have to be prepared to take orders quickly, ramp up and slow down quickly. We work with our suppliers to be able to meet these demands.” Mannington has also expanded its Express Program to include about 170 SKUs including broadloom and modular carpet and LVT. In 2013, Tandus Centiva learned how to do many things at once. “It’s highly competitive and fast paced, but being able to take on challenges has shown us that the right people can achieve a great deal,” Hussman said. Carpet Initiatives In 2013, Mannington’s Connected, a modular carpet collection that previewed at Neocon in 2012, rolled out and is doing very well. “It is geared to corporate and offers a lot of options. Made with Antron Lumena nylon, it speaks to large open floor plans with visual cues and texture that is more luxurious for new spaces,” Ganley said. “At Interface, our key initiatives were driven by our Mission Zero promise to eliminate any negative impact we have on the environment · fcw122313pages.indd 18 FLOOR COVERING WEEKLY · FCW by 2020,” said John Wells, president and CEO. Interface’s Net-Works initiative is providing a highly sustainable material source — salvaged fishing nets — for the company’s yarns. Since 2012, Net-Works has worked with fishing villages in the Philippines to collect discarded fishing nets. Aquafil recycles the nets for use in the nylon fibers for Interface yarns. Shaw continued its tradition of innovation with its unique hexagon shaped tile and with Patcraft’s Design Catalyst collection that includes carpet and resilient products that are designed to work together, according to Knowles. Tandus leveraged technology and innovation in launching its collections String Theory and Jackson, both created with Sero Design technology and available as hybrid resilient and modular products, according to Hussman. Janet Herlihy Shaw’s Vance Bell speaks at the grand opening of Shaw’s carpet tile plant in China. WWW.FCW1.COM December 23, 2013 12/18/13 9:23 AM Tile & Stone Demand, competition increase As demand for ceramic tile rose in 2013, so has competition. “The business climate in the second half of 2013 was similar to the first,” said Raj Shah, co-president of MS International. “We continue to see a pickup in overall business. Significant investment is being made across the board by companies in the sector. The overall employment, housing, interest rate environment and stock market picture is continuing to drive demand despite short-term speed bumps such as the government shut down.” Midway through 2013, U.S. ceramic tile consumption was up 11.7 percent from second quarter of 2013, according to the Tile Council of North America. Through second quarter, 837.3 million square feet of ceramic tile arrived in the U.S. This was an increase of 14.8 percent from the same period last year, in which 729.3 million square feet of ceramic tile were imported into the U.S. Industry leaders continue to monitor the stability of housing and commercial recovery, the availability of credit, consumer confidence and energy prices. “To meet these challenges, we continue to improve productivity at our plants with newer, faster and more efficient equipment,” said Lori Kirk-Rolley, vice president of brand marketing for Dal-Tile. Added Sean Cilona, Florida Tile marketing director, “Overall, 2013 was a great year, but some of the biggest challenges are still trying to get customers to come out of their shell, so to speak, and step out on commitment to inventory and mid to higher priced products. Everyone has been so scared and reserved for so long, I think we are all hesitant to make big investments.” The company launched a lot of new product and discontinued others which was a challenge, he said. “That is never easy for an organization or customer base, but we are doing it for the betterment of the group and the bumps in the road now will lead to an overall stronger product offering,” he explained. Rising raw materials There has been industry-wide concern related to raw material costs. “We’ve responded by focusing on alternative sources to offset the need for virgin raw materials,” said Mark Shannon, executive vice president of sales for Crossville. “Our partnership with TOTO has enabled us to generate feedstock through the recycling of materials that would have otherwise been land filled. This approach supports our commitment to sustainability and reduces the environmental impact of both our and TOTO’s manufacturing processes.” At Dal-Tile, they also look for alternate sources for raw materials but have also moved to consolidate freight to reduce overall costs, added Kirk-Rolley. Global challenges “Overseas inflation and interest rates are causing large changes in exchange rates, which hampers the ability to make long-term plans when it comes to imported product,” Shah said. “Domestically, a large issue is the non-renewal of GSP [generalized system of preferences]. This is significantly raising the prices of imported products.” As interest increases for ceramic tile, business is getting more competitive. Home centers expanded their focus on ceramic tile over the last 12 to 18 months, increasing competition among independent flooring retailers in the ceramic category. At the same time, “Floor covering retailers who invest in the tile and stone category, and commit to it, continue to show strong signs of growth, particularly in the higher end of the market,” Kirk-Rolley said. 19 Another rapidly accelerating trend is that more and more retailers such as Lumber Liquidators and the Tile Shop are emerging and going after the consumer directly, she added. “This is an emerging opportunity for us, but also a competitive threat if we’re not continuing to build relationships at the wholesale level,” she noted. While consumer demand for tile and stone increases, marketers are shifting strategies to reach them, particularly to social media. The goal: to provide product information while driving the consumers back to the brick-and-mortar showroom whenever possible to make purchases. MS International introduced a new online application that helps customers visualize MSI products in different kitchen settings. Showroom sales people can use the Kitchen Visualizer to mix and match cabinet colors with a variety of stone and tile surface options. Dal-Tile and American Olean re-launched their websites in response to a usability study. “In just a few months, we’ve seen significant increases in overall website traffic and page engagement, reductions in home page bounce rate and an increase in unique visitors per month,” Kirk-Rolley said. The companies also converted their traditional print catalogs to virtual catalogs that can be accessed online, offline and through various devices such as smart phones and tablets. Continued on page 20 Integration strategy Dal-Tile & Marazzi Group Dal-Tile recently completed the integration of the U.S. business of The Marazzi Group. Floor Covering Weekly spoke with Gianni Mattioli, executive vice president of marketing and research & development, and Jim Fanning, senior vice president of home center and distributor sales, to discuss the merger and the expectations of the business moving forward. Jim Fanning Gianni Mattioli How did you manage customer expectations during the merger? Fanning: When you have a merger of companies this size, there is a lot of back-office and behindthe-scenes work that happens, systems integration, billing, and we attempted to make it blind to the customer so that they would continue to see the same look and feel that we are behind them 100 percent. Five or six months later, it has gone very well. We have been out talking to our customers reassuring them that the business they have done with Marazzi, Ragno, American Olean and Dal-Tile is the same. that goes on before the actual close and coming together of the companies. Tactically, there are a bunch of meetings and events around integration, clarifying and defining our strategies among our employees. If you look across industrial America, and mergers in general, there two types: growth opportunity ones and consolidation orientated ones. This is not a strategy of companies coming together and laying off 20 percent of the workforce. This is a growth strategy and our market is growing. We intend to grow faster than the market, expand our capacity and we are bullish on the market. That is the message we brought to our Mattioli: We have new product and pro- employees on day one: keep focused on 2013 grams, and we have definitely tried to limit because it is the driver for 2014 and beyond. any disruption for the customers. From all the comments we are hearing, I think we Mattioli: Our overall strategy is to keep growhave accomplished that. ing, to grow faster than the market grows, and we think we can accomplish that. In order to How did you bring the two companies do so, we are trying to get the best of both comtogether culturally? panies. [In Dal-Tile] You have this very large Fanning: That is a function of the planning Continued on page 20 December 23, 2013 fcw122313pages.indd 19 WWW.FCW1.COM · FLOOR COVERING WEEKLY Harmony™ Take a design passion and make it a lifestyle expression, with HARMONY by Marazzi USA. Bold linear slashes of colored grains immediately draw your attention. A color-body porcelain tile, HARMONY brings you a unique modern, exotic wood look for every room. www.marazzitile.com · 12/18/13 1:59 PM Demand, increase a ventilated porcelain stone façade, in partnership with Shackerley of England. “These endeavors come on the heels of the 2012 launch of Laminam by Crossville, our exclusive distributorship of Laminam porcelain panel collections in the U.S.,” Shannon said. “These strategic partnerships allow us to participate in new categories and enjoy opportunities that wouldn’t have been open to us previously.” Crossville rolled out a new retailer program this year that was created to bridge the gap between professional, small firm designers and retailers — offering a place where they can work one-on-one with their clients. Advancements in technology, such as porcelain panels, have introduced a new need for more training education among contractors. “It’s essential that installers know how to correctly install large-format panels, and we’ve taken a lead in bringing them practical knowledge, preparing them for the growing wave of large format panel installations,” Shannon said. really engrained in the tile and stone industry, and for some people, their entire careers have been around these brands. There is no big Continued from page 19 bang theory or real disruptive changes that we company, very structured, with a lot of infra- have planned. [Each brand has] carved out its structure. Then you have Marazzi, which is a place in the market and we have looked at how smaller company overall, and with an Italian to expand their positions. philosophy to be more nimble, faster, with a higher level of flexibility. If we can merge the What can flooring retailers and distributors two at some point, we have a strong point in expect from this merger moving forward? a market that is changing very fast. Even with Fanning: I think some things they can our size, we need to be able to do that and we expect. Certainly this combination of what I have termed capacity and capability. We are are moving in the right direction already. enhancing both through this merger. From How will the brands work together or com- a North American production standpoint, Marazzi and Dal-Tile have clearly — by far pete within the U.S. market? Fanning: If you look at the four brands, and — the most capacity in the North American even including Mohawk, you have brands that market. Being able to reach back into Italy to have been in the market for decades. They are the design community, and the science and manufacturing of tile, and bringing that to the U.S. market, you are going to see an accelerated pace, better products, better trends, better designs. Accelerating the Cersaie trending to the U.S. market — we will be able to turbo charge that, which is important to the commercial market and the green community. Continued from page 19 Crossville, which continues to create a strong presence through blogs and social media is using strategic partnerships to position itself for growth. The company partnered with TOTO to introduce Hydrotect, bringing the latest generation of air-purifying, self-cleaning properties to its porcelain tile collections. Crossville also launched SureClad, Integration Mattioli: If possible, we will have an even stronger focus on the product in the future. We want to get as close to the market as possible in terms of product development. We will add more capacity in that we will have an expansion in the Sunnyvale [Texas] plant. It will be one of the most state-of-the-art plants worldwide and certainly in the U.S. It will allow us to go into larger sizes, 24 X 48 and plank, and more of the products you have seen in the latest Cersaie. FCW FCW Correction Correction Corrections Corrections Marketplace The New Leader in Flooring Software Pacific Solutions offers flooring’s only management software that runs native and optimized on iPad® and iPhone®. FCW FCW 2014 Mohawk Continued from page 4 noted, “This is for retailers who want to create a premium destination. The life of the display itself is more useable than in the past and holds up to 40 styles.” The system, said the company, was in direct response to the streamlined launch of the soft category a year ago. In 2014, Mohawk will add two new tonal LCL patterns, two solid LCL products and a textured loop with fleck and a 70 ounce solid texture with 40 color options. New in the EverStrand brand is EverStrand Soft Appeal. Noted Duncan, “EverStrand Soft Appeal represents the next generation of PET carpet innovation. With our patented Continuum process, this collection of carpets is soft, beautiful and easy to maintain.” Karastan Introductions to the Kashmere collection — nine total nylon styles — represent the ultimate in carpet styling. “We are investing in the brand and the product,” said Bill Storey, senior vice president of sales, Karastan, noting that the high end of the market today is strong. Karastan offered SmartStrand Silk and solid and blended wool carpets as well. “Wool performs, it lasts forever,” he said. “We are taking wool to a new level of softness with Worsted Wool.” FCW FCW FCW FCW Run your business YOUR WAY! Call to learn WHY others attempt to imitate us. We Sell Freedom fcw122313pages.indd 20 pacific-solutions.com 800.400.4927 12/18/13 2:10 PM Classifieds Career Opportunities The America's Floor Source one of the nation's largest flooring companies CosT... is seeking a full time flooring estimator for its Columbus headquarters. Applicant must have previous flooring estimating experience. Candidate should be able to figure all types of floor covering, use estimating software, and perform material take-off in the field. Must also be detailoriented, organized, able to multi-task, and a team player. ...oF Running a FlooRing Business Just got SlaShed... Requirements include: • Proficiency in Excel • Familiarity with digital take-offs from dwf or pdf formats, • Using Callidus or comparable software. • Ability to perform hand take-offs quickly; field measure; • pattern match roll goods; custom wall-tile layouts • Ability to visualize and communicate material layouts • Ability to function in a fast paced, high pressure, and • Quick turn around environments QFloors software cuts overhead costs, streamlines operations, prevents dropped balls, and increases profitability. We’d love to show you how. Call today for a FRee demo. www.qfloors.com (866) 563-0140 Contact Us Today! Samples of professional turned out quotes and bids a definite plus. Visit Us At FCW1.com 2013_QF_FCNclassifieds_2x4.indd 3 6/29/13 12:05 PM Salary is based on knowledge and experience. 401K and health benefits included in employment package. If interested, please email your resume to: tim@americasfloorsource.com. Interviews will begin immediately. Sales Reps Major wood flooring manufacturer is looking for sales reps to open territory and bring sales, must have customer base. Please email your resume to: flooringresume@gmail.com Sales/Marketing Product Director TW Flooring Group seeks a Sales/Marketing/ Product Director for our Portuguese Cork. Need the ability to drive cork sales through our various channels including EcoTimber. Requires distributor/dealer relationships & cork experience. personnel@twflooringgroup.com AGENTS WANTED Career Opportunities LARGEST FLOOR COVERING FRANCHISOR IN NORTH AMERICA HAS OPENING FOR MIDWEST REGIONAL VICE PRESIDENT Candidate must have experience in the floor covering industry and reside in the Midwest region. Responsibilities include recruiting new franchisees and servicing current franchisees with the best marketing and merchandising programs in the flooring industry. Overnight travel will be required. Our proprietary programs help retailers become more successful while maintaining their independence. From national advertising to aggressive turnkey sale events to a state-ofthe-art consumer website, to B2B programs to private label merchandising, we provide the tools needed to succeed in today’s business environment. Compensation will be discussed with qualified candidates. Excellent Benefits Package including Medical Insurance and 401K. Email Steve Mintz at SMintz@abbeycarpet.net with cover letter and resume. All responses will be kept confidential. fcw122313pclass.indd 25 Many territories open. One of the fastest growing Chinese manufacturers of quality engineered flooring in the USA. Please send contact info to rick@aurorahardwood.com Cavalier Carpet Industries has a company territory manager position available for Illinois, Iowa and Southern Wisconsin. Compensation includes salary, commission and expenses. All inquiries kept confidential. Send resumes to: Email - dolliehiggins@windstream.net Royalty Carpet Mills is looking for experienced carpet sales representative in the Austin/San Antonio market. Please send resume to jhudson@royaltyusa.net Cavalier Carpet Industries has a company territory manager position available for Washington and Oregon. Compensation includes salary, commission and expenses. All inquiries kept confidential. Send resumes to: Email - dolliehiggins@windstream.net Stacey Iaccino fcwservices@hearst.com Call: (516) 227-1407 Fax: (516) 227-1342 Next up in FCW, January 13, 2014 Issue • SURFACES • Wool Carpet • Software I • Adhesives - Quality is the Answer Ads Close Jan. 3, 2014 Business Opportunities TIRED OF PAYING TOO MUCH FOR TOO SLOW FREIGHT? Tell the MILL to Ship: “CCL/DELTA-COLLECT” AFFORDABLE-FAST-DAILY DELIVERIES of CARPET from ALL Dalton area Mills to Virginia/DC/Maryland Broadloom as low as $0.30SY+FS ON 1000+SY Pay the driver C.O.D & take 10% discount. OVERNIGHT EXPEDITES only $500+Standard freight. Call or email ED for quotes. Ed@Carpetlogistics.com or call 410-604-3330 START GETTING DELIVERY ON YOUR OWN TERMS AND SCHEDULE !! We get all the flooring others can't get at the lowest prices. Call 706-264-8425 WE HELP DEALERS Private labels, specialty mills & etc. Call us now at 800-228-4632 www.carpetbroker.com NEED $$$$ ?? I will buy your Oriental Rug and machine made inventory for cash!! I will travel to you in USA or Canada CALL MAURICE KAOUD AT 860-836-9559 1 CENT/SF FLOORING ESTIMATING Fast & Accurate - Callidus Takeoffs www.commercialflooringestimating.com Business For Sale Clinton Township, MI. Owner Retiring. 5000 sq. ft. Showroom-Warehouse. Turn Key Ready. Low Rent with option to buy 10,000 sq. ft. plaza. Call for information 810-343-3101 9" x 9" K Block engineered Wood tile Manufactured in the USA, 1/2 thick. Plywood base. Min quantity 200 sq. feet. monarch-mills.com/ 1-800-530-8812 Career Opportunities Alpharetta, Ga Seeking a Sales Professional/Manager. Minimum of 2 years experience in floor covering sales. Must be knowledgeable in all aspects of flooring -carpet, wood, laminate, tile. We need a professional who is assertive & ambitious that possesses excellent communication and computer skills. Full Time position. Please send resume to: FloorAmericaAtlanta@aol.com 12/16/13 12:24 PM 22 The Last Word Fast times in flooring (Part II) O f the many profound changes we’ve witnessed this year, one of the most dramatic has to be in carpet: Mills are making major investments in plants and fiber systems as both PET and “soft” have captured significant and growing share of the market. With three major fiber systems to choose from, consumers have more reasons than ever to select carpet. It has also reenergized the mills, and will hopefully inspire them to advertise more directly to the consumer to drive interest, an area where they remain woefully, painfully inadequate. In distribution, large companies are becoming stronger as they gobble up chunks of the market left behind by weakened competitors. That’s good news since distribution plays such a critical role. Add the fact that many suppliers are simply not up to the task of going direct — even in limited markets — and you’ll see why strong distribution is a good thing. Hanley-Wood Expositions is also getting bigger with its acquisitions of the Greenbuild show and its expansion into the International Surface Event that includes the Tile show, Stone Expo, Surfaces and now an October event in Miami Beach. In spite of the continued fracturing of the flooring market, industry growth should make Hanley-Wood’s play to make its shows more important a solid bet, even if the Miami event remains in question. Mohawk has become a giant. With its recent acquisitions, FLOOR COVERING WEEKLY Mohawk has become a behemoth across several of the major categories it produces — carpet, ceramic tile, patented locking systems and laminate. Will this change the way the company goes to market? We’ll have to wait and see. Something that might have gone unnoticed is the announcement by INSTALL that it would guarantee all of the installations made by its certified installers. I think that could have profound implications if retailers are willing to play up the value of professional installation. Frankly, it is inconceivable why they wouldn’t since that is what differentiates specialty retailers from others and is what delivers real value to the consumer. It is also why Home Depot has worked so hard to devalue installation with its low-ball installation offers. Finally, the Internet has emerged as the single most powerful weapon for specialty retailers to communicate with consumers. That’s not new. What is also not new is that no one has come up with a complete Internet offering. If I’m a retailer running a business, what I don’t want is to have to learn a completely separate discipline — Internet marketing — which is complex, expensive, time consuming and highly technical. Instead, I want someone to offer me a complete package that is worry-free. Ideally it comes from buying groups and franchises, from manufacturers or even from the World Floor Covering Association, but it should provide me with all the tools I need to run my online presence with a minimum investment of time. That is something I bet most retailers would be willing to pay a premium for. The need is certainly there. — Santiago Montero The year in FCW F or better or worse, I like to take time at the end of one year, beginning of the next, to look back, assess how things were, see what the year was all about and begin to map out how to make the next one better. This year I decided to go through my editorials to see what the year was all about, what was on my mind and yours. It was a meaningful exercise for a couple of reasons. First, it became really clear that what was going on at FCW was a lot. We all spent a significant amount of time on the road, be it a convention, seminar, vendor and retail one-on-one meetings or a special event staying plugged in to all that was going on outside of our own office. We tackled emerging and tough industry challenges and we dedicated full issues to important topics like Made in America and Green, and we addressed the growing global market with our all new dedicated World Marketplace issue. Of course FCW's much anticipated State of the Industry Report is an anchor of the year’s line-up. One distributor at NAFCD asked — half seriously — if we could possibly deliver that issue just a bit sooner in the year because it was an important part of his company’s business plan. That won’t likely happen as our numbers are based on real government data and a painstaking process. Even in the editorials, we were diligent exploring the Gen X & Y consumer as well as education at the store level. Edu- cation is something we will continue to talk about as we further develop our Education Center on FCW1.com, a clearing house for everything the industry has to offer. We challenged you to reenergize your retail space and take advantage of what your aligned group has to offer; and, we encouraged you to tell your story in a meaningful way to your customer. Another hot topic this year was all of the investments being made in the flooring industry. We did a great job all year of bringing you the news but we also dug deep and looked at what all the millions being spent, especially here in the U.S., really means. If you haven’t read our Outlook 2014 issue, you should. The larger message is that we are again building and growing the floor covering industry. Lastly, I received a request from a dealer in Upstate N.Y. who asked that I address the dress code on the selling floor. I didn’t really expect the large amount of positive feedback on that one. But it clearly struck a chord. And when I talked about my hometown Pittsburgh, it also prompted response. Both of these editorials covered simple things — how to present yourself for the job you have and basic work ethic. That was another running theme for 2013: The basics are the things that will keep you moving into the future. Welcome to 2014! — Amy Joyce Rush Wishing all of our readers a very happy Holiday season and a Happy New Year! — The Staff at Floor Covering Weekly. fcw122313pages.indd 22 The Industry’s Business News & Information Resource FCW Editorial and Sales Headquarters 50 Charles Lindbergh Blvd., Suite 100, Uniondale, NY 11553 (516) 229-3600 • FAX (516) 227-1342 Editorial (516) 229-3600 Fax (516) 227-1342 Advertising (770) 919-7747 Fax (770) 919-1348 Classified Advertising (516) 227-1407 Fax (516) 227-1342 Editorial Santiago Montero Publisher & Editor in Chief (516) 229-3617 smontero@hearst.com Amy Joyce Rush Managing Editor (516) 227-1421 arush@hearst.com Kimberly Gavin Editor at Large (706) 278-3690 kimgavin@aol.com Mallory Cruise Assistant Managing Editor (516) 227-1361 mcruise@hearst.com Brittany Walsh Assistant Editor (516) 227-1358 blwalsh@hearst.com Janet Herlihy (361) 906-1117 herlihyjanet@gmail.com Columnists Jon Trivers I take the floor (530) 876-8454 jonathantrivers@sbcglobal.net Kermit Baker Beyond the numbers kermit_baker@harvard.edu Chris Ramey Strategic insights (561) 876-8077 cpr@affluentinsights.com Marge Redmond Heard on Main Street marge@oldtownflooring.com Tom Jennings First things first (785) 843-1678 thomasjennings@hotmail.com Rhonda Robinson Making What Matters Most Happen (541) 383-8044 Rhonda @RobinsonRo1.com Advertising Southeast, Midwest, West Coast U.S. & Canada Charlton Calhoun (770) 919-7747 Fax (770) 919-1348 ccalhoun4@aol.com Northeast U.S. Cal Calhoun (770) 919-7747 Fax (770) 919-1348 chcalhoun3@hotmail.com Classified Ads Stacey Iaccino (516) 227-1407 Fax (516) 227-1342 siaccino@hearst.com Production Thomas Young Group Production Manager (516) 227-1369 tdyoung@hearst.com Matthew Lippl Production Artist (516) 227-1354 mlippl@hearst.com Administration Sherridan Basdeo Advertising Administrator (516) 227-1307 sbasdeo@hearst.com Carolyn Giroux Audience Development Director (516) 227-1376 cgiroux@hearst.com Adriana Marzovilla Financial Manager (516) 227-1364 amarzovilla@hearst.com Steven R. Swartz President & Chief Executive Officer William R. Hearst III Chairman Frank A. Bennack Jr. Executive Vice Chairman Richard P. Malloch Group Head & President Steven A. Hobbs Executive VP & Deputy Group Head Robert D. Wilbanks Group Controller Sales Headquarters 50 Charles Lindbergh Blvd., Suite 100, Uniondale, NY 11553 (516) 229-3600 • FAX (516) 227-1342 Floor Covering Weekly (ISSN-0015-3761) is published bi-monthly by Hearst Business Communications, Inc./FCW Division, 50 Charles Lindbergh Blvd Suite 100, Uniondale, NY 11553. Periodicals postage paid at Uniondale, NY and additional mailing offices. Subscription rates: Domestic: $25 per year, $48 two years; Canada: $60 per year, $110 two years. Sales Agreement No. 4001287. Foreign: $174 airmail. Single copy Domestic: $4.00, Canada: $6.00. Printed in the U.S.A. POSTMASTER: Send address changes to FLOOR COVERING WEEKLY, PO Box 3012, Northbrook, IL 60065. To subscribe: call (866) 813-3752 or go to fcw1.com/subscribe For reprints of articles: Wright’s Media (877) 652-5295 12/17/13 1:09 PM fcw122313pages.indd 24 12/12/13 4:13 PM fcw122313pages.indd 24 12/18/13 9:11 AM
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