Industry developments: Dancik, RFMS, QFloors, Rollmaster and more
By Darius Helm
Software for flooring dealers and distributors has come a long way from the accounting programs developed in the ’80s. Today’s software offerings are fine-tuned instruments of commerce, designed to increase all efficiencies, streamline operations, maximize outputs and seek out new business.
It’s been a game-changer for many retailers, and during the recession it helped keep many businesses afloat. And it’s safe to say that the only businesses that haven’t experienced the advantages of software platforms are those that aren’t using them—including those still relying on QuickBooks, which in this context is the modern-day equivalent of the abacus.
Even though flooring software has been widely available for over a quarter of a century, an estimated two thirds of independent flooring retailers have not yet chosen to embrace these technologies. Others have used business management software designed for flooring specialists for years and on the consumer-facing side have developed sophisticated websites, and it has transformed their businesses.
ATTENTION: QUICKBOOKS USERS
The jury is in—and it’s been in for a while. Even if you’re a mom and pop retailer with a few hundred thousand dollars in annual sales, limited inventory and lousy store traffic, you will make more money if you drag QuickBooks to the trash and sign on with a flooring software provider. Small retailers can get systems for total expenditures of $5,000 or less along with a monthly charge of a few hundred dollars for service and support.
QuickBooks is an accounting program, and it competently accounts for money. The software programs offered by the likes of RFMS, RollMaster, QFloors, Dancik and Pacific Solutions, along with website programs from firms like Creating Your Space and Floor Force, account for, track and chart not just money, but also inventory, scheduling, transportation, installation, sales productivity, lead generation, sampling, promotions—and anything else you can think of.
While it’s true that human beings are capable of managing excruciating details, like timing all of their flooring shipments to coincide with scheduled installations, pending promotions, in-store specials and anticipated foot traffic, there is no glory in such endeavors. Machines do it faster and better, and you don’t have to put them on a Prilosec regimen. After all, the idea of technology is to let machines do all the dull and tedious work, leaving humans to do what the machines cannot and to benefit from all the rewards.
By all accounts, retailers recoup their initial investment in short order, and that generally comes from the initial trimming of waste, like reducing inventory shrinkage, and the software’s breadth of scrutiny, far beyond what a team of people could scan and track, which captures, for instance, credit card discounts and generally opens and closes valves you never knew existed both to draw from every revenue stream, no matter how small or transient, and to prevent any money from trickling out.
So there’s that side of the software programs, the enhanced efficiencies and the ability to sniff out discounts and other opportunities—kind of like having your own professional coupon clipper. The other side is made up of the tools that grow a retailer’s business, and that’s in the arena of customer relationship management (CRM).
Both website developers and flooring software providers offer programs related to leads, including a variety of lead generation tools, selling tools, and streamlined systems of completing the selling and installation processes, follow-ups and referrals. Having a web presence is more than offering an online brochure. Web technologies can do an admirable job of finding potential clients (selectively screened), drawing them in and engaging them. There are whole scientific disciplines based on consumer drives, influences and preferences that website developers apply to the design and function of the retailer’s consumer interface, all gauged to initiate and augment the selling process.
So there’s all this—the business software and web presence that maximize profits and drive growth—and then there’s that digital abacus with its reassuring implicit promise of doing your books and doing them quick. So why haven’t more retailers adopted flooring software strategies?
Whether you’re willing or reluctant, change is difficult. People work hard and develop skills to manage an enterprise and they become proficient in that business landscape. Then the landscape starts to change, upsetting the established equilibrium. Initially, most people resist the change, though over time there is a natural transition. But those who hold out longer face a more jarring transition, as the gulf widens between the world their business is based on and the 21st century digitally connected world, and too many are inclined to just maintain the status quo and get by with hobbled expectations.
However, beyond the fundamental resistance to change, there is also the challenge of the transition itself, a barrier to adoption that even the software firms acknowledge. Shifting one’s business to run with flooring software programs means not only integrating everything about the business, from financials to databases to contacts, into the new software, but also adjusting business routines to work with the software—though it’s worth noting that learning and using the new systems is fairly straightforward, and generally yields processes that are more efficient and logical.
The process itself generally takes months for full integration, though there are software providers that promise to complete the transition within just a few days. A lot of it depends on the size of the business, numbers of users and how comprehensive the software package is. But whether the process is completed in days, weeks or months, it’s a disruption from the regular routine at a time when there are not enough hours in a day to stay ahead of the competition.
Minimizing disruption is of paramount concern for software providers. Most of the software businesses out there, including RFMS, QFloors and RollMaster, were started up by flooring retailers looking for a better way to do business, so they’re cognizant of how retail operations run. Their software packages are designed for integration with as little impact on business operations as possible.
WINDOW OF OPPORTUNITY
The good news for those flooring businesses still relying on QuickBooks, construction oriented software or jury-rigged homegrown systems is that the financial payoffs are better than ever. Sure, those early adopters were savvy and have made gains against their competitors as a result of their software systems, but those software programs have evolved over the years. They’re easier to use, provide more efficiencies and offer more tools to grow one’s business. So retailers that make the move now will make more significant gains than ever.
Timing is important. In general, software providers report that new clients were few and far between when the housing market was in freefall. No one was willing to consider upgrading or investing in a new software system with sales so meager and margins so slim. However, when the market is very active retailers can be reluctant to risk their momentum with something as extensive as integrating a complete enterprise resource planning (ERP) package.
Despite the improving economy, it was a slow winter for the flooring business, thanks largely to the weather, and most of the software firms report signing up plenty of new clients. Spring flooring business should be brisk, and that could extend all the way into the fall, assuming that there are no major events that would cause the economy to stumble, so retailers may not have a chance to consider software options for several months.
For the last few years, retail groups have been encouraging their members to adopt flooring software platforms, and both buying groups and mills have also been emphasizing the opportunities in developing a web presence. But that doesn’t mean that flooring businesses should run out and buy the first flooring software they find. Hard drives across America are littered with artifacts from flooring software that retailers purchased but never put to use, while a whole other set of retailers uses software that they know is flawed and substandard, but they’re not inclined to shop around again.
The flooring software business is fairly consolidated, with five firms accounting for the bulk of marketshare. And on the consumer facing web programs, the market is dominated by two businesses, Creating Your Space and Floor Force.
On the software side, the biggest firm is RFMS, which has been in the business since the mid 1980s. In that time, RFMS has worked with over 3,000 businesses, according to the firm, and 9,000 stores use its software, including operations overseas—mostly in Australia and England.
The firm offers a comprehensive ERP system with all the modules to successfully run a flooring business. Last year was RFMS’ best year ever, with the implementation of several new systems and growth in its client base.
RFMS recently introduced In-Home Solutions, a mobile-ready app that allows users to link between Measure Mobile, its mobile floor estimating application, and the store’s RFMS server, enabling a salesperson to close sales in the field. A built-in checklist ensures that nothing is left off, like miscellaneous products and labor.
Pacific Solutions, based in San Diego, was the first firm to develop a Windows-based system, and that was in 1995. The firm started off focused on the residential flooring dealer with its FloorManager system, but about six years ago the firm added JobRunner for commercial contract dealers. Currently, about two thirds of the firm’s business is on the retail side, and one third is commercial. During the recession, when residential software business was slow, the firm’s commercial software sold briskly. This year, residential business is rebounding. Pacific Solutions has about 1,000 clients using JobRunner, FloorManager or FloorRight, the firm’s estimating software.
One of the advantages of Pacific Solutions’ software is that the database engine the firm writes in is FileMaker Pro, which is owned by Apple. And Apple has been good at delivering feature sets and tool boxes that easily work across its entire platform, so the software runs natively on both Mac and Windows systems. Pacific Solutions is the only flooring software provider to use FileMaker Pro, according to the firm.
Recent additions to Pacific Solutions’ arsenal include Enterprise Scheduler, an advanced scheduler accessible by clients and installation crews on any platform, the Enterprise Financial module, and SiteDraw, designed for iPads and iPhones (with Android being added later this year), which allows commercial and residential dealers to go into the field and use a laser range finder that integrates with their mobile device to create as-built drawings with ease and accuracy. The drawing can be saved as a PDF, a CAD file or it can go right into the firm’s FloorRight estimating software.
Another major player is QFloors, which was incorporated in Utah in 1999 and came out with its own full system of true Windows-based software just a couple years after Pacific Solutions. Business was strong until the housing collapse. However, following a few stagnant years, QFloors has seen record profits the last two years. The firm now has about 600 active clients, including many larger retailers with several locations.
Recently, QFloors built into its software a new CRM system that tracks leads, manages follow-ups and customer contacts, and offers a range of sales productivity tools. The firm is also starting to work on web interfaces that enables customer information entered into the website to be integrated with the software system. One of QFloors’ selling points is its claim that it can go into a business with its software and complete the transition in mere days, even for larger firms with dozens of users.
Another major player is RollMaster, which is based in Hammond, Louisiana. The founder, Dev O’Reilly, started to develop software in the late ’70s, which was before most people even knew what the word meant. The RollMaster name was created in the late ’80s, and the first software sales were to wholesalers, with retailer software systems coming a couple of years later.
Before the turn of the century, the product was sold with server hardware, but when the firm rewrote its software for Y2K, it took the opportunity to shift to a hosted system. Currently, RollMaster software is used in about 600 locations, including distributors and residential flooring dealers, along with multi-family and home builder operations.
RollMaster’s business was fairly strong during the downturn, possibly catching savvy clients that, concerned about the health of their businesses, turned to software to maximize all aspects—and the slow market gave them time to properly integrate the system and get fully trained. Business is still strong, with about 8% annual sales growth.
Then there’s Dancik, which is somewhat different from the others. For one thing, it has far bigger clients (Armstrong is one). Also, it doesn’t sell to smaller retailers, and its business is split in thirds between manufacturers, distributors and retailers.
Dancik started out in the mid ’80s with a focus on specialty retailers of tile and stone, a higher end segment of the market. It focused on design showrooms through the mid ’90s, when distributors started lining up as clients, and manufacturers came next. In 2013, Dancik’s clients included 17 of the top 25 flooring distributors. The firm currently has about 125 clients, representing 1,200 locations.
Recently, Dancik converted its entire system into web service functionality, which includes enabling the access of Dancik functions on mobile devices. The firm has also been focusing on the ability of its system to share categories of information with other entities, like overseas suppliers. These days, there’s increased value in having access to information from all sorts of sources, all consolidated into a single format—think of the experience of shopping on Amazon, where vendors from all over the world sell their products through the familiar detailed format of the Amazon platform. Such seamless programs are achieved through the disaggregation of functionality, which allows the different pieces of a system to be used independently for various functions.
On the web side, Creating Your Space has been in the business of offering websites and enhanced web presence for eight years, with about 200 clients and close to 600 retail locations. The firm’s websites are designed to offer maximum functionality to consumers, providing an online shopping experience that is comparable to a showroom experience and prepares them for the selling process with everything from visualization tools to quizzes that assess their wants and needs.
At the end of last year, Creating Your Space launched its Lead Generation 360 program, which represents the evolution of its business. First it focused on custom websites, then mobile websites, SEO, social media and other ways of capturing traffic. Now the firm has developed a whole suite of tools designed to drive traffic to websites, combining SEO, pay per click, directory services and retargeting—a system that follows customers after they leave the client’s site, throwing banner ads their way as they meander through sites like CNN.com, Better Homes and Gardens, and literally tens of thousands of other sites.
Newer to website development and design is FloorForce, which was launched in 2010 with the goal of creating websites for flooring retailers that offer the same degree of functionality and ease of interface as big box websites and the like.
According to FloorForce, it’s all about the first seven seconds on the website. Data gleaned from 2.2 million consumers going to its dealer websites annually has shown that if they don’t find a visual (like a product button) showing that the site has the product they’re looking for within seven seconds, 90% will leave the site. Once they find the product button, they’ll spend an average of over two minutes in the product catalog, and 78% of consumers who have been into the product catalog will visit at least four more sections in the site.
With this data in mind, Floor Force has developed websites with high functionality and clear product information. Consumers looking at a product on a dealer’s website can now click on “add to my project” and accumulate samples inside a project cart, then click a button to request samples. The information goes to the dealer, which in turn will set up an appointment to bring samples to the consumer and jumpstart the selling process.
LOOKING AHEAD: INTEGRATION
From a lay perspective, what stands out about the landscape of these software and online technologies is that it doesn’t make a lot of sense that the business management software side is distinct from the web development side. After all, they’re both integral digital parts of the business. And with lead generation and selling tools on websites needing to link to inventory and other aspects of the business, it seems more important than ever that the two sides work in concert.
Some of the software firms have started working more closely with website developers, while others believe that it takes a lot less time to build a website than it does to build a complete software system, making it conceivable, and even a natural progression, for software firms to enter into the website arena on their own.
Copyright 2014 Floor Focus