Onboarding a successful tile program at the retail level is no easy feat. It requires expertise beyond typical product knowledge, access to highly skilled installers and a customer base looking for aspirational products that increase property/resale values. The category also requires savvy retail store owners and RSAs who aren’t afraid of a challenge.
For those who can tackle the category at the retail level, benefits abound—higher profit margins and ticket sales as well as forging a reputation for style and design, to name a few. With these benefits and more on the table, suppliers strongly advise retailers to embrace the category no matter what market segment they serve. “Tile is a growing category and one of the largest categories in the industry—and can be a significant revenue opportunity for specialty flooring dealers whether you are in the new construction, remodel or commercial segment of the business,” said Randall Sheehe, regional sales manager, Emser Tile.
It’s hard to dispute the visual prowess of the ceramic category—it is only limited in design by the user’s imagination—and suppliers agree it should be top of mind for dealers looking to break into the category. “Today’s inkjet technology has truly blurred the lines between man-made and natural materials,” said Paulo Pereira, senior merchant, MSI. “These product advantages create elevated demand from consumers seeking ceramic among the dizzying array of flooring options. This demand brings high value to ceramic as supply and demand still reigns supreme.”
Tony Wright, director of dealer sales, Dal-Tile, agreed, noting tile’s high style and durability as main selling points for dealers looking to grow their business. “Ceramic tile is a valuable category to the flooring dealer because it allows them to offer their customers an option that is unparalleled in style and design, durability and ease of maintenance when compared to every other flooring option,” he told Floor Covering News. “The dealer who actively sells ceramic tile is invariably making a higher ticket sale, which will add to overall revenue growth and profitability for the dealer.”
Jason Neu, marketing and outsourcing director, Portobello America, also pointed to higher margins as a key selling point. “Porcelain tiles typically have higher margins compared to other flooring options due to their durability and longevity. This means that you can sell fewer tiles to achieve the same revenue compared to other types of flooring.”
He also noted revenue gains due to the larger average sale with tile. “Porcelain tiles tend to be more expensive than carpet or luxury vinyl, which means the average sale per customer is typically higher,” Neu explained. “This can help you achieve higher revenues and better profitability.”
Tackling challenges
Breaking into the tile business without breaking the bank, while challenging, is a manageable endeavor for many flooring dealers. However, it does require overcoming some of the major hurdles associated with the category. Those challenges usually include labor, training, infrastructure and limited showroom real estate, to name a few. However, suppliers say they are always on-hand to help their dealer partners succeed—and it’s the savvy dealer who knows when to ask for (and accept) that help.
“The biggest challenge for the dealer today is the shortage of skilled technicians to install ceramic tile,” Dal-Tile’s Wright explained. “However, developing a skilled labor force can be accomplished by the dealer. The CTEF, NTCA and other organizations provide education and training to assist the local dealer. We also provide support at the local level with over 200 sales service centers located around the U.S. and Canada staffed with knowledgeable personnel who will assist the dealer with all their tile product and installation product needs.”
What’s more, while the piece of the puzzle marked “installation” might seem like a curse, MSI’s Pereira noted that it can be a blessing with the right perspective. “Ceramic has a mid-to-high cost of labor, which provides the dealers ability to increase their profits,” he said. “Tile is one of the few flooring categories that has a large amount of customization options available during installation. Tile installers can truly be artists with custom, high-level installations, which fetch a top-tier labor price.”
Another aspect of a successful tile program is training. Both the store owner and RSA need to be up to date on the latest styles and performance innovations as well as best practices when it comes to installation. For Emser, training is No. 1, behind labor, on the list of challenges dealers will need to tackle. “It’s important to invest in training your RSAs to properly set expectations when selling a tile job, explain the installation process and time it takes,” Sheehe explained. “It’s also important to properly train them on the quotation process. Emser offers an in-depth training program for new and veteran RSAs that want to hone their tile selling skills. We also have 78 branch locations around the country that are here to serve [the retailer].”
Operational challenges may also be on the docket for those looking to the category as a new source of revenue. “Ceramic is heavy, breakable and typically has a large variety of associated SKUs such as mosaics, trim, installation materials and a large variety of sizes and formats available,” MSI’s Pereira explained. “These features can be a strain on the infrastructure of dealers. [But] operational challenges can be overcome with proper warehousing, staffing and partnering with a strong ceramic supplier. Dealers may require additional facilities or staffing to be successful, but a strong supplier can be a tremendous asset to a dealer—which eases the burdens. MSI has over 40 warehouse locations nationwide.”
One of the final pieces to the puzzle is showroom space and sampling, which should be top of mind for those dealers growing the business with tile. “One of the key challenges is having enough area to display floor tiles,” explained Suzi Portugal, vice president of design and sourcing for Mosaic Companies. “As larger sizes are becoming more popular, sampling can be challenging. The showroom real estate is one of the dealer’s most valuable assets, so selecting items is very important. With so many similar sizes, finishes and looks, ensuring you have the right products and looks for your market can make the program successful. Our ceramic and porcelain floor tile programs are created with dealers in mind.”
Top tips for newbies
It may be easier said than done, but there are some major touch points suppliers say are imperative for dealers to accept before they break into tile.
“To start with, the retailer needs to have the mindset that the consumer has changed,” explained Paij Thorn-Brooks, vice president of marketing, Dal-Tile. “Today’s consumers conduct a tremendous amount of research online before they ever step foot inside a retail store. Today’s floor covering retailers need to be present on social media and also very savvy using digital communications.”
Partnering with the right supplier is also key. “In addition to selecting brands that are on trend and known for quality, dealers also need to go with brands that do a good job of supporting the consumer during the entire product selection journey,” explained Patrick Warren, vice president of residential sales, dealer & showrooms, Dal-Tile. “This means having a cohesive customer journey from digital all the way to in-store. The savvy brand will have a robust digital presence that includes an impressive and easy-to-use website as well as social media positioning.”
Suppliers agree, tapping into successful partnerships is more important than ever. “Utilize a partnership with a strong supplier who has the structure in place to supply dealers with the assets they need to become a strong success,” MSI’s Pereira said. “These partnerships can be vital to early success for a dealer who has no access to the assets of high-cost infrastructure.”
Mosaic Companies’ Portugal added, “The right partners are key to having a successful program. They not only provide you with the expertise and market data needed but also help you to select products and marketing vehicles that would better serve the dealer and their customers. There is also a significant benefit in having access to their marketing assets and support to build a program to fit your clientele’s needs.”
Another key tip for dealers is keeping costs down by offering a limited selection of products to start. “Focus on popular sizes and finishes, such as 12 x 24 and 24 x 48, in polished and matte finishes while at the same time offering value add options such as coordinating wall tiles and/or special pieces,” Portobello America’s Neu said. “This will allow you to keep inventory costs low while still offering a variety of options to customers that may or may not be deciding to purchase from big box suppliers. This strategy will not only help your conversion rates but increase your average ticket.”
Last but not least, Emser’s Sheehe keeps it simple: “Start where you are comfortable,” he advised. “It could be backsplashes since those tend to be the easiest to install.”
