With competition from box stores and online dealers, rising costs, and pressure to cut margins, flooring retail is a tough business, especially if you don’t have the right sales and marketing systems in place, referral customers are key.
I interview industry leaders on what they see successful retailers doing to grow sales, keep their margins up and beat the boxes. This interview is with Bob Eady, President of T&L Distributing headquartered in Houston, TX. We sat down amidst the enormous bustle of Surfaces in Las Vegas to get his perspective on what successful dealers are doing to stay on top.
Bob, what do you see successful flooring retailers doing to increase sales?
They know the customer base they are trying to target, and they communicate directly with them. They are not trying to be all things to all people. Their showroom is set up to merchandise to that particular group of consumers. Retailers need to stay focused on the segment where they are most successful. Middle to upper-end retailers also keep their products and merchandising up to date. They don’t have as many suppliers represented on their floor. They stay focused. They do as much business with a particular supplier as possible and leverage that loyalty.
The vast majority of my readers have 1 to 5 stores. What do you see these kinds of smaller retailers doing to be successful?
The lifeblood of our business is dealers with 1 to 3 stores. The buying groups brought a new level of professionalism to dealers, especially in terms of merchandising. A lot of showrooms used to be kind of junky. Now you can go into a single store, and it looks gorgeous.
How important is it to focus on getting referrals?
It’s critical. Remember the old adage: a happy customer will tell 1 person; an unhappy customer will tell 7. The lifeblood of a retailer is the installation and doing it in a satisfactory manner, so the customer is happy. We find really good dealers typically have the best mechanics. Too many dealers don’t focus on finding the best installers. If you are not able to keep those customers happy through your installation, you lose the referral business. The most successful retailers focus on customer service, which is the true value of a Retailer. Their salespeople and their installers are better trained. They will invest in those aspects of their business. Training is hard for a smaller dealer as it takes time and time is a precious commodity to an owner.
How important is marketing to your past customers?
It’s vitally important. Implementation, actually doing the marketing is key, and Dealers need an easy way to accomplish that. But the independent dealer is very busy and extra time is needed for a marketing program. Some dealers have a service that markets to their past customer for them so that the dealer isn’t trying to cover all those needs themselves. However, there are numerous examples of 1-store owners who do very, very well. They’re the ones that pay attention to and focus on repeat and referral.
Do you see the successful dealers competing on price or value?
You see a mix. There are some product categories that are more price driven. The successful dealer tries to start the consumer at a higher price point with a more top quality product. A lot of the price consumers — the internet customers who buy on price and try to install the floor themselves — wind up dissatisfied. They wind up being good customers down the road because Mamma didn’t necessarily like the way Papa put it in.
In the next installment, I interview Pat Theis, the Vice President of Sales and Marketing for Herregan Distributors, Inc. on what he sees successful retailers doing to avoid competing on cheap price.
To Tons Of Customers!
Jim Augustus Armstrong is The “Coach”
Jim Augustus Armstrong is the President of Flooring Success Systems, a program that equips dealers to double their profits, cut their work hours in half and beat the boxes! Many dealers have totally transformed their businesses and their lives for the better after joining Flooring Success Systems.
See what real, live dealers are saying!