Palos Verdes, Calif.—The last time Shaw hosted its Circle of Distinction (COD) event in 2020, the world had just started shutting down. The NCAA tournaments were being canceled. spring training came to a halt. Two years later, COD was held here without that uncertainty as the company’s top sales associates from 2020 and 2021 were acknowledged.
During the event, FCNews publisher, Steven Feldman, was given the opportunity to host a wide-ranging roundtable with seven of these associates during the general session. These included: Brady Bayliff, a COREtec rep from Des Moines, Iowa; Parth Brahmblatt, a builder rep from Columbus, Ohio; Brad Knight, an RVP from Detroit; Antonia Infante, an Anderson-Tuftex territory manager from Connecticut; Tempe Hoover, an RVP in the San Francisco area; Nicole Meiners, a builder rep from Denver; and Frank Larratta, a territory manager from Calgary, Alberta, Canada.
How did you become a Circle of Distinction winner? What traits do you possess that make you better than other reps in the industry?
Larratta: One of the things I really tried to do over the years was not just go into stores and try to sell something. I try to get to know my customers on a personal level. When you get to know your customer on a personal level, things like claims become easier to deal with because you have that familiarity and friendship with them.
Meiners: The No. 1 thing that sets me apart on a macro level is attitude. I go into every account with a good attitude, especially over the last couple years. They don’t want to know what kind of day I’ve had, because they’ve had a rough day themselves. I feel like it’s my job to make their day better.
Hoover: I think just being committed to being successful, both for the dealer and for ourselves. And helping them be successful, in turn, helps me be successful. So, going in with an attitude to help them win is one thing that sets us apart.
Infante: Reliability. Recently, one of my customers said I was her only rep who was actually helping her with a claim she was working on. And then, of course, being that this is a relationship business and having customers get to know you. Many of my customers know that sometimes I travel with my dogs. I bring them in, we pose with the Pet Perfect samples and set them up social media.
Knight: For me, it’s more about curiosity to learn, leveraging what we have in this room. There are people who have been instrumental in helping me, not trying to reinvent the wheel.
Brahmblatt: All of us are customers. We go to restaurants, we go shopping. And when you see an employee who is truly passionate, that’s inspiring. Some go out of their way to make you feel comfortable. I try to do that with my customers. It’s not about product; it’s about a feeling. You need to be genuine and try to understand customers’ challenges. Walking in with another letter of a price increase is challenging. There’s a way to convey that message by being humble yet confident.
Bayliff: Every day I want to be that dealer’s first call. And there’s a lot that goes into being that first call if they need something. It’s doing the simple stuff every day, answering my phone, responding to emails, texts as timely as possible. And being someone who is knowledgeable in everything we do whether it’s COREtec, Anderson Tuftex, Shaw hard surface, carpet, commercial. It’s being the expert. I pride myself on being a very knowledgeable person. I get calls all the time from dealers asking about products that aren’t even mine.
What are your customers excited about for 2022? What’s been the feedback that you’ve received?
Larratta: There are still a lot of challenges. First quarter was pretty good. It’s slowed down a little bit, and there’s some volatility with inflation and gas prices. They’re excited, though, because they can see a way out of it all. And their business is growing in partnership with us.
Bayliff: I think a lot of dealers are excited that we’re getting back to some kind of normal. We may not see as many price increases as we did. We know inventory is getting better. They’re seeing a light at the end of the tunnel. They know they’re going to have growth this year.
Brahmblatt: First of all, every retailer is busy. They’re growing their numbers, partially due the price increases, but their net units are growing as well. They can’t find enough installers to put down the jobs they have. There is a tremendous amount of business out there. Specifically, with business builder side of business, housing starts are projected to be 1.8 million this year. That number is the highest it has been in 16 years. And still there are not enough houses. People are paying high dollars for our product. So that tells me we have opportunity for the next five or 10 years.
Meiners: I think for the last couple years, people are more invested and care more about their homes since they’re spending more time there. And I think that’s something our dealers are excited about because it’s a safe haven, a place people really take value in now more than ever before. And I think it’s going to continue.
Even though business has been strong over the last 18 months, there are still challenges. What’s been your biggest challenge in dealing with customers?
Knight: I think it comes down to expectation with our customer because so much has been changing. It’s been hard for us internally to know exactly what expectation to set. Are we going to have that product? Are we going to be able to fill that order? We’ve done some things internally to improve our messaging with customers. Communicate where’s the order at? What inventory is going to be here? What products should we steer them toward? So our challenge is making sure we’re up to date and we’re following the information from our channel team. We’re leveraging the tools like Shaw on the Shelf, ATS inventory. It’s about being in tune with that so we can relay our messaging. If the customer knows it’s going to be six or eight weeks, that’s great. But if they think they’re going to get it in a week, now you’ve got an issue.
Bayliff: The inventories are getting better, but that’s still our biggest tie down. I know my biggest challenge is just being able to manage that. And I think a lot of that is knowing our products, making sure we can create a substitute option for customers and not just saying, “Hey, it’s going to be six weeks on a product.” I’ve created spreadsheets for dealers to help them with inventory. It’s just giving them as much information as possible.
Meiners: I think on the builder team, we have a lot of administrative work that gets in front of going to see customers and actually selling something. What I started doing about six months ago was on Monday I would set three goals that I had to accomplish that week, completely outside the box that had nothing to do with the administrative work. They could be small, like these three commercial products you need to hit a customer and sell them. So I think getting past the administrative work and finding different opportunities in the field is one of the biggest frustrations right now.
Considering all the challenges and headwinds in the market today, how are you reimagining your approach to the customer and what do you do to stay motivated every single day?
Larratta: I love going out and seeing my customers every day. Everyone in this room is outgoing and need to be in front of people. So we need to take off our sales hat and put on our solution provider hat. All of us do that well. It’s our responsibility as senior sales leaders to go out and teach the new people coming in. That’s a major part of what we do, not just selling.
Brahmblatt: To be bluntly honest, what motivates me is money. One person in leadership said when he started in the business, Shaw was doing $70 million and now we are on the cusp of doing $7 billion. That’s over a 34-year career. So I’m sitting here today, perhaps at his stage when he started. We’re at $6-$7 billion. We’re looking at $10 billion. I think by the time I retire, let’s do $25 billion. That’s what motivates me.
Hoover: I am motivated by helping the dealer be successful. These are all people who have family businesses. We have the most unique tools for our dealers to be successful. Shaw on Shelf was such a great tool for me to pivot during COVID. It really does motivate me to help them and to see them be able to do some of that stuff on their own. But just to motivate them like, “Hey, did you know you can use this tool that we have available for you?” They get excited about that. And it helps them get an answer sometimes more quickly than we can. So to be that resource, to teach them a piece of technology or whatever we have out there to help them, is something that motivates me.
Knight: I think in the last two years there’s been a lot of firefighting. There have been a lot of negative conversations. We have to find a way to have fun. We just have to get to our customers, whether that’s taking them out for afternoon golf. It means a lot to the customer. And I think it’s what differentiates us.”
Global events have led to series of price increases over the last year. Have you gotten pushback from your customers on these, and how do you overcome that?
Knight: We had a price increase in June and this one retailer must have sent 20 price deductions right after. Some of them were actually ordered on the day of the increase. But what we ended up doing was sitting down and saying, “OK, there were three or four that were six months back-order products. Let’s partner on this. We’re going to take care of some of these but not all 20.” And anytime you can create a positive experience, reinforce that the challenges they’re facing in their business we’re facing them too on our end. It’s why the increases are coming. I found leaning into that partnership has really helped us. It’s also helped us getting back to expectation. Set the expectation for the next time around: “Hey, if you’re going to order it on the day of the increase, we’re not taking care of that.” Make sure you’re communicating to your customers it’s very volatile. There’s inflation. Increases could be coming. Use it to encourage them to sign on that dotted line and get that order placed. It’s just being able to balance that and be fair in our partnership.
Hoover: I think just being transparent with it all and getting ahead of that so it doesn’t become a difficult conversation to have. We get a lot of notification time, 45 days [or so], to let our dealers know. It’s about setting the expectation with them so as they continue to happen, we can be in front of it instead of having to catch up on it.
Meiners: We are getting pushback, of course. We’ve had a lot of price increases, but I approach it with compassion and teamwork. The customer needs to know you’re there for them. The No. 1 thing they want is communication. They want to know what’s going on. They feel like you’re a partner when you talk about the price increases. And again, that compassion piece: We’re in this together, we’re going to get through this stronger and better together.
There are longer lead times and delays related to shipping for just about everything these days. How do you manage customer expectations?
Larratta: We have a lot of tools, especially on the technical side. So getting in front of your customer and saying, “Hey, before you actually pull the trigger and order something, double check stock. It may not be in stock, but call me; I can double check and see when our shipments are coming in.” People are more understanding these days.
Bayliff: It was very frustrating when we were having so many delays and back orders. And yes, we’re trying to find substitutions, but we were losing business in some cases due to things not being available. So using tools like checking stock, Shaw on the Shelf, knowing they were able to do that themselves was big. But I took it a step farther. I created a spreadsheet of what we had in stock and I sent that out to my dealers every two weeks. So if you’re on the floor and you’re working with the customer and she is falling in love with a product, the dealer will know by looking at a spreadsheet what’s available. It’s about trying to give them as much information as possible. And then it makes it easier to find a substitution if the back order takes too long.
Meiners: Being on the builder team, the reselects over the last couple of years have been extremely difficult. We pick our products six, eight, 10 months before. So we can’t be as prepared and fit as easily as retail can. I think what our team did in Colorado has made us successful. Instead of taking a targeted approach, what we started doing, especially over the last couple years, was surround our markets as a team. We work as a circle instead of one-on-one. So a builder or customer could call me and need help on something. They need a reselect. It could be one of my teammates who respond. It doesn’t matter if it’s my order or my customer. We’re working as a team to find solutions, and our team in Colorado wins because we work as a circle, not one-on-one.
All these supply chain issues are affecting every facet of new home construction. Have the other areas of new home construction impacted you in any way?
Meiners: Of course, we get impacted from delays. But what makes it easier for us is they see delays in everything. They can’t install the floors if there are no windows. So they’re more understanding in today’s marketplace about delays, but it is a struggle. It really took a toll on designers. These designers were used to doing one reselect a month. Now they’re literally doing two reselects a day. They put so much passion and time into these design appointments, and then they have to see these home buyers again. They’re trying to increase this home buyer experience, but they have to see them again and again. So it definitely has impacted us; it’s just that flooring goes in last, so we’re the ones that get hit last. We’re the ones who leave the lasting impression on these houses.
Brahmblatt: We have house closings without a garage. There are no refrigerators in these houses. The small things you would expect are not there. Luckily, 95% of the time the flooring is there when they do the closing. And then property management, there are 50 million homes in the United States that are considered multifamily. Between now and 2030, there are going to be another 5 million to 6 million homes. So the demand is going to be there. Our leadership enacted a streamlined approach to products on the property management side. It’s not going to be 32 flavors; we’re going to a six-flavor approach. And that has worked phenomenally from an efficiency as well as profitability standpoint.
I know multi-family is very strong right now. What are you doing to capitalize in your local markets?
Brahmblatt: Multifamily is a lot easier and more difficult at the same time, because multifamily customers, developers, end users have to have product. So when they are specifying something, they’re not necessarily going be loyal to one brand, one product. Once that project gets going, if they don’t have the material it’s not going to go so well. We often get calls at the last minute. It’s about who can provide product on time.
Meiners: Multifamily for me is the place where relationships are the most important. Multifamily business is about nine cents. Who has the cheapest price? Can you get the material? And we may not always be the lowest price. We may not always have truckloads tomorrow that I can ship. But I’ve been there for you and with you for the last few years; we’re partners in this. I may be struggling right now on this particular product, but who’s been with you this whole time? I have. Shaw has. We’re not going to cut this deal right now and in six months take it back. We’re consistent. We’re loyal to you. That’s where the relationship piece in multifamily is so vitally important.
Retailers are having success today with higher-end, higher-margin products. How are you driving the premium carpet and hard surface portfolio to achieve higher margins in your territory?
Larratta: It’s just letting them know the quality, the ins and outs of certain products, what makes it better than the low-end stuff. And I think people generally want good products in their home. If there’s one thing COVID has shown us it’s that we’re spending more time in the home, it’s our safe place, we want it to be comfortable, and we want quality. We don’t want to be surrounded by the cheapest stuff.
Infante: From the Anderson-Tuftex perspective, we have a lot of expensive carpets in the high $50s-$60 range, and that will result in a little bit of pushback, but most of the time it’s about having a conversation. How big is the piece of carpet you’re going to be selling? Six to 12 feet or something like that. So you’re investing a little more in smaller pieces to last a long time. It’s a more expensive product per square yard, but overall, it’s not that scary of a ticket because they’re not buying tons of material. And then if they’re doing a stair runner, that’s going to be on their stairs for a long time. You want it to be a good quality product that will last forever. There is a correlation between quality and price. And we have the warranties to back them up with our Pet Perfect products with our 50-year wear layer warranty. So you have a lot of confidence in selling a high-dollar product because you’re getting a lot for that money.
Meiners: In the builder world, it’s all about helping our designers tell a story. The designers are in front of these buyers and want to do a good job for their buyers. I feel it’s my job when I’m in front of the designers to give them stories to sell these upgrades. Let’s talk about Repel. Let’s talk about our scratch resistance. Let’s talk about the waterproof story. That’s how we sell upgrades in the builder market–by teaching our designers how to sell and tell a good story.
Bayliss: I think the stories are important, but there are a couple of things to this. One, our product development team does a phenomenal job of giving us amazing products with phenomenal visuals. And then we can go out and give all that information. Second, I think the price increases have leveled the field in a lot of circumstances. I think customers who were once more price conscious aren’t as much anymore. And I’m speaking more on the retail front than the builder front. So you’re seeing more high-end LVT being sold, more high-end engineered hardwood being sold, because the price differences have closed that gap a bit. When you do have amazing visuals and amazing products, thicker products, any of those things, customers aren’t blinking an eye anymore. It looks good and that designer likes it, and we go in and tell that story, it’s made it easier for us as salespeople to do that.
Brahmblatt: The average net selling price for WPC—their cost—is $3 a foot. Dealers can sell a beautiful, soft, thick piece of carpet that’s way less than that: $27 a yard. Putting things in perspective, they’re selling $3 a foot LVT without blinking an eye; why are you scared to sell this high-end Tuftex product that’s $30 a yard which is much more comfortable. It’s not necessarily selling one or the other. It’s just making them understand it. Think about where we are in this country right now. If you’re going to sell your home, you have to buy another home that’s equally or more expensive. Your options are pretty limited. You’re probably going to stay in your home for a long period of time. Your home value has probably doubled in the last 10 years. So you have tons of equity. Most of these homeowners haven’t shopped for flooring in a long time. They don’t know what things cost. So the biggest thing I tell dealers is don’t be afraid to sell higher-end goods and you will be successful.
Knight: I think it really comes down to understanding the market, understanding the customer. I’m not saying you can’t educate customers on the benefits, but also knowing where to take it. And then, do you know that designer you’re talking about? Can I go in and craft my Pet Perfect story around their clientele, the builders they’re working with? I think the more you ask questions along the way, then when we get handed a great product from channel and category, now we know exactly how to make those smart placements to capitalize on a great product launch.
These last two years have forced all of us to change some aspects of the way we do business. Do you do anything differently today in terms of relationship development and more face-to-face time?
Hoover: I’ve used a lot of digital tools over the last two years. In the Bay Area we were really closed down for three months. We were not seeing accounts. But this is such a face-to-face business, and there were so many great things we could do to stay in front of our dealers, virtually, like creating videos with different content. That tells me to continue to use those. So maybe those C and D dealers that I don’t need to see as frequently, sending them videos on a new product or a new tool that Shaw has, or just a tool they’re not using yet. It’s made us be a hybrid in the way we see our dealers. My time with the dealer hasn’t changed in that sense. I’m still getting in front of them, but using the tools that COVID forced us to use to get in front of people, especially to continue that relationship with those dealers you don’t have to see as frequently. It’s a good pivot point that’s made us do something unique, but to our benefit in a lot of ways, too.
Knight: It’s been very easy over the last couple years to be reactive. Putting out fires. In the first 12 months of stepping into this role, I felt like every account I was seeing was because there was an issue: service, supply, pricing. And I think it’s been very easy for us as a service-minded company to want to jump into that situation and find solutions. But I do think it’s important that we all take a moment to say, “OK, how am I being proactive in my area? How am I scheduling the time to take care of the service challenges and those things?” But then also not being so reactive that I’m not getting out and doing the things I need to do, asking the right questions, getting in front of those customers. I think so much of it just comes down to opportunity. We ask the questions, we find out there’s a project going on, now it comes down to capitalizing.
Meiners: In the single-family and multifamily world, some of the things we did prior to COVID will never come back. I have a corporate office that used to have almost 300 people in it. It was easy. I just went down the line and addressed all the issues, saw all the people. That building is closed now. All those people work from home. So you have to pivot and find different ways to do things. In that particular case, once a month, we have a lunch with three of the salespeople, and it’s actually more impactful. So right now, I would try to be more impactful in the appointments we have and the people we see, because we do not get to see them as much. Some of these now require appointments whereas you used to be able to just walk in. It’s a different way of doing business, and we just have to find different ways of accomplishing the same goals.
Brad, you’ve been leading one of the company’s Associate Resource Groups. Talk about that: what it is, what it means to you and how more Shaw associates can get involved?
Knight: The short answer is it is a great way to make a company of 20,000 associates feel a lot smaller. Each Associate Resource Group has a different take, and I’ve been a part of founding Mosaic, with the vision around embracing and empowering those with seen or unseen disability. I have a brother who is autistic. He graduated college in 2015 and it took him five years to find a job. It was a tough journey to watch him go through this. Mosaic is about making sure that as a company, our processes are allowing people like my brother to flourish. We’re trying to make sure we’re putting the processes in place to make sure all voices are heard.
We just launched in the fall of 2021, so we’re really in our infancy as a group, but you don’t have to know somebody who may be suffering from a disability to be part of Mosaic in particular or any of the other groups. We just want people to come in and connect. It’s about conversation, and certainly leadership opportunity, too. It’s a great way to meet different people, to feel more connected. And hopefully at the end of the day, drive value for our organization.