NFA Board, from left to Right, Dan Mandel, Dave Chambers, Susan Hadinger, Jessica Arscott, Ian Newton, Deb DeGraaf, Jason McSwain
NFA retailers dig into best practices & ways to build each of their businesses
[St .Kitts] The National Floorcovering Alliance (NFA) Board met here to address some of the industry’s critical issues and to share best practices used in their own operations. FCW sat down with the Board following their own meeting to talk about the agenda that was created to meet members’ needs.
As new NFA president, Ian Newton of Flooring 101 in California told FCW, “I want to bring value to the group.” This, he said, happens with idea sharing. “Product is what we do but it’s the relationships.”
Indeed, much of the value of NFA membership goes well beyond product and the group’s buying power. Explained Nebraska Furniture Mart’s (NFM) Dave Chambers, “It’s great to see product but we want development outside of flooring. A big part of the meeting is best practices.”
Much of the transparency comes with the group’s famous two-minute drill when each member candidly shares how their business is doing, strategies they are employing and opportunities they have identified. Jason McSwain of McSwain Carpet & Floors in Ohio and NFA past president, offered, “Members prepare and share for the two minute drill.”
Added Susan Hadinger of Hadinger Flooring in Florida, “The collaboration is huge.”
And for Jessica Arscott of Floortrends in Canada, “This is why we joined — the sharing,” she said.
Leading with Efficiency
Tony Boldt from NFM was tapped to talk about Authentic Leadership, while Deb DeGraaf, DeGraaf Interiors in Michigan, will address best practices for structuring your business and empowering leaders within your business.
This, she said, leads to efficiency in decision making. “As owners, we are pulled in all different directions, she shared. We didn’t have a structure that if someone needed something, they would know who the person is to go to other than me or Dean (DeGraaf, co-owner). You can’t do that overnight.” DeGraaf hired coaches to for leaders. “It’s us needing to empower leaders to make decisions.”
DeGraaf ,as well as other NFA retailers, utilize assessment tools such as DISC to help in building and structuring their teams. “It’s being aware of different personalities,” she noted.
State of Industry
The NFA shared with FCW that store traffic has indeed slowed. However, many report that ticket sales are higher and by diversifying the business they go after, their businesses remain healthy.
NFM’s Cambers noted, “Traffic is off.” Newton too reported that he said is off compared to 2021 and 2022.For DeGraaf retail business is down.
But because members are located across the country and into Canada, experiences are different. “Where our group is fun, is that we are coast to coast. In the Midwest, we had the best first quarter in five years in retail,” said McSwain.
“We are seeing a slow and then we see it up — it is inconsistent,” shared Arscott.
“The key to success is taking market share,” Newton asserted, adding that there are pockets of growth. “Main Street is still growing. Retail traffic is down but there are higher tickets and the hardwood business is up.”
Added Hadinger, “Traffic is down but we are still busy. Traffic is down 10 to 20 percent.” Her store is in Naples so part of the uptick in sales is due to the results of Hurricane Ian. While traffic is down, she too is seeing tickets increase.
“When things are tight, the consumer tends to go to a trusted retailer that is an established retailer,” offered Newton.
And, after a couple of years of fast paced business, a slowdown allows these retailers to do an assessment looking at everything from operations to staffing.
Offered Dan Mandel of Sterling in California, “It made us evaluate the sales staff — who is an order taker? And,” he added, Sterling is reevaluating areas of opportunity noting, “Senior living is a big focus and Main Street commercial. It’s a reset.”
Floortrends said Arscott, has taken time to do a complete renovation and put in new systems. “One store was a complete conversion. It was a big undertaking,” she noted.
Taking on Challenges
While pricing has stabilized, product is getting caught up by boarder control for evaluation to identify if it was made using forced labor is presenting yet another obstacle for floor covering retailers to navigate.
Explained Newton, “Back orders are the hardest challenge for sales [associates] when they find out they can’t get the materials.”
As a result, many retailers are carrying more inventory than usual. “We have a tremendous amount of inventory,” said Newton. Both Mandel and Hadinger are doing the same.
Compounding the issue, explained Newton, is that even if a product is made in a facility not using forced labor, “It doesn’t necessarily mean the product is going to get through the port. In a perfect world, it would all be domestic.”
In fact, these retailers are leaning into products made in the states such as laminate and carpet are doing well. Offered Newton, “Laminate is a really good looking product. Mohawk, for example, has really good looking stuff.”
Added Chambers, “Carpet is performing. Our (Shaw) Anso Gallery is fantastic, it’s one of the few carpet vendors doing great.” Mandell added that he too will be putting in an Anso Gallery.
Another issue, Hadinger pointed out is the labor market. “People don’t want to work anymore.” DeGraaf agreed saying it is a problem in her warehouse specifically.
Newton added another challenge to the list: “The benefits of homeownership has changed too. They are less on investing in buying.”
Explained DeGraaf, “They don’t want to commit — they’re a free spirit.”
And, Mandel pointed out, “They can’t afford to buy a home right now.”
Special Sauce
Despite ongoing market challenges, these retailers remain successful by touting the benefits they offer and how they are unique compared to competitors.
“For builders, I tell the story of NFA and the buying power we have. It gives us credibility,” said DeGraaf. “We talk about exclusive product and market share.”
These retailers are aggressive in getting their brand in front of the customer. “The first thing people cut is advertising so we increase ours,” Newton revealed.
Hadinger said she does the same, noting, “We focus on advertising. We don’t cut.” Chambers and DeGraaf both said they have ramped up their advertising as well.
For Mandel, “It’s about servicing — the little things that people don’t get when they walk into another store.”
McSwain shared that he conducted a focus group of some 700 consumers across his marketplace — some that purchased from McSwains and some that didn’t — to better understand the customer and how different areas of his business are viewed. As a result, he said, “We have a better understanding on things like financing and when do they get engaged. For us, it was the 24 to 36 months. The other area was on price points and discounts — what’s a believable discount. Let’s change it to be closer to those.”
He added that the research also helped the store better understand brands within flooring. Based on findings, he said, “We have to rethink our marketing.”