Log in to view the full article
At a GlanceName: Flooring America/Flooring Canada |
HF’s Andrew Averill spoke with Keith Spano, president of Manchester, N.H.-based Flooring America/Flooring Canada.
What is Flooring America/Flooring Canada?
It’s a cooperative group of independent retailers. The beauty of a cooperative is that we give independent retailers the size, scale and scope to be able to compete in their local markets. In our case, these people are fixtures in their community. They support Little League and the Girl Scouts. The money they make stays in the community.
What’s your role?
My job is to help retailers in our group grow their businesses. We work for our members, which is different than in a franchise. Each member within the group has a unique set of needs specific to their market, and we work with them to address those needs to ensure they are successful. We give those retailers the size to compete with the big-box guys. Because we run a cooperative owned by our members, we’re like a team of NFL coaches. As long as we’re having winning seasons, we keep our jobs.
Why do floor retailers’ businesses fail?
What we’ve found is that some people in flooring are afraid to make a profit; they want to compete on price. When someone joins, we advise them to raise their prices. People look at us like we’re crazy, but this is not a hobby. We lay out a path for our retailers to add to their bottom line—offer private label products, exclusive warranties, the latest technology.
How does the small retailer compete with the big guy?
I think you have to call out your differences to compete with the big-box retailers, whether that’s warranty, product offerings or service. These things can’t be touched by the big-box stores. Anyone can give stuff away. That doesn’t take skill. We train our retailers to change the product, not the price. That’s a hard lesson to teach people. We use our private labels so that we don’t have to go head-to-head on the same products in a race to the bottom. We tell our members to figure out what makes you better in your market and stand behind it.
What trends are you seeing right now?
There are major regional differences, and I don’t mean only engineered versus solid. There are styling differences. The West Coast and the South are moving toward a softer scrape. In the Northeast, the soft scrape is coming, but there’s still demand for rustic. That wire-brushed look is continuing to take a little more market share. If you look at size trends, we used to consider 5 inches a pretty big plank. But now 7 inches is the new 5-inch.
What about colors?
We’re seeing the proliferation of gray everywhere, with everything. It’s in floors, it’s in fashion. I have it in my kitchen. We’re also seeing browns minus the reds, the softer browns.
I read that you’re diversifying your offerings?
Yes, we have many different programs in home design that our members can implement to meet the different needs of our consumers. It is our goal to cast a wider net, whether it is paint, kitchen and bath, closets, design services. When we look at flooring, we look at opportunities. We learned that if we sell a kitchen or a bath job, we never lose the flooring job. It’s more of a defensive maneuver. A quarter of all floor covering retailers went under during the recession, yet today there is more competition than ever before due to the warehouse clubs and others.
What are the pros of a cooperative?
We give our retailers the power to do things they couldn’t implement on their own. We have a national advertising program. We have digital marketing programs and microsites we provide for all of our members. We do private labeling of soft and hard floor coverings. We have a social media program where we syndicate content for all of our members.
Can’t retail companies do those things on their own?
Most retailers have a need that keeps them up at night, something they wish they could do better. Most retailers I’ve spoken to don’t have expertise in social media, marketing or other aspects of the business. And we can help them with that. For each member it varies, so we have a variety of programs they can participate in.
What other services do you offer members?
We’re actually hiring sales staff for our members, which is a huge challenge for our retailers. We have a program called Hiring for Success. We go out and advertise and market open positions. Then we cull through the numerous responses and résumés we get in and narrow it down to one or two. We have a fantastic onboarding program. We can take a salesperson and put them through our courses and have them hit the ground running. We have a program called Fast Start for new salespeople and one called Restart for the veteran sales professionals. If you look at the NWFA, we’re both trying to elevate the professionalism and the education of the consumer experience.
What’s your merchandising system?
It’s called the Evolution Merchandising System. When you walk into a store with that system, you don’t see a hodgepodge of distributor and mill displays. The displays coordinate—they’re all the same style, the same finish. They all have the Flooring America/Flooring Canada branding. It’s a clean, modern presentation, and it’s flexible. We can take a hardwood display and put carpet on it. The displays are part of the larger store design, what we call our Vision Showroom, which gets an update this summer.
How do you become a member?
We look at our membership as a big family. There are only so many seats at the table. We look for the best member in any given area that’s not being served by a Flooring America/Flooring Canada. We have a member procurement team that looks for these people. We look for quality and a good fit. Our goal is simply to have the best retailer in every market that is providing outstanding customer service and a great legacy. We have a lot of second- and third- generation owners in our group.