Tile Files - March 2012
By Brian Hamilton
Selling tile successfully at retail is largely about finding a way to distinguish a business from others in the market, but focusing strictly on price isn’t likely to work for most independent retailers. It’s difficult to compete against the home centers and even online tile suppliers if price is the major concern. The big players just have too much muscle.
Ruby & Quiri of Johnstown, New York and Bullnose Tile of San Jose, California have completely different approaches to selling tile but their strategies have been largely successful. Both sell more wall tile than floor tile. This is contrary to U.S. consumption numbers, which are heavily weighted (approximately 79%) toward flooring from a dollar perspective.
Ruby & Quiri, which calls itself a home furnishings super center, sells appliances, electronics, furniture and more, as well as a full range of flooring. And while it does tout “lowest prices” on its website, shopping at the store is a far different experience from going to a home center. For one, it has a design center that can help with tile design, as well as general interior design to help integrate tile into a much bigger project. The firm will provide top notch installers and generally make sure the project is completed professionally to the customer’s satisfaction.
Bullnose, on the other hand, only sells tile and has made its mark by having a huge inventory of products exclusive to its market and providing other ancillary products that no one else has. Bullnose has a 27,000 square foot warehouse that contains more than 2,000 pallets of tile, much of which the company imports directly from Europe, although it does have domestic producers such as Crossville. It gets very little product through distribution because of problems with reliability and it wants product exclusivity. Bullnose is also the largest stocking dealer in North America of Schluter System products, which are finishing profiles for floors, walls, countertops and stairs. Other tile sellers in the San Jose area will refer their customers to Bullnose just for its Schulter products. Metal Schluter profiles have become a huge part of the business, accounting for about 12% of sales. Last year Bullnose sold half a million dollars worth of Schluter products alone.
Bullnose, which sold $4.8 million in tile last year, is strictly a cash and carry operation and doesn’t get involved in installation.
However, it will help a homeowner design a floor, often with the help of the website Houzz.com, which has more than 250,000 high quality interior and exterior photographs, as well as a large database of design and decorating ideas.
One thing both businesses have in common is their emphasis on their showrooms. Even then, however, they go about it in different ways.
Ruby & Quiri
“Our main focus is the customer, while in the home centers the main focus is on moving product,” says flooring manager Robert Young. “People come to us because they’re interested in full service.” Ruby & Quiri is big on visualization, helping customers imagine how tile would look in their homes, unlike a home center that essentially has boxes of tile on display, with perhaps a few mounted on boards.
Young says customers are often awestruck at the flooring displays, and especially the tile displays, and the tile department can be kind of intimidating. Customers have to walk through the section to get to other parts of the store, so it is a well traveled area.
“Our main display as you walk in has just been revamped,” Young says. “We’ve tiled all the floors and the presentation is really nice and it does draw attention, and that leads to questions. Once a customer starts asking questions, we can get them to start envisioning these products and how they might look in their homes. It’s a psychological thing.”
The flooring department has also just installed a kiosk that allows a customer to upload a photo and insert tile into it, whether its wall or floor tile. Throughout the store there are televisions showing completed jobs, just another nudge to help the visualization process.
Ruby & Quiri takes a lot of time to train its tile sellers because the more knowledge they have the easier it is to get the customer dreaming in the right direction.
Young says that Ruby & Quiri allows some of its general sales staff to sell flooring. However, when the conversation turns toward tile, it’s difficult for a generalist to close the sale, so someone more knowledgeable generally takes over.
“That has worked because our tile sales have grown,” Young says. Part of the issue is that selling tile can be fairly complicated. Customers often come in with some basic knowledge but don’t know, for example, the difference between ceramic and porcelain and their performance characteristics or what kind of stone might be appropriate for a particular application, or how much maintenance is required for a marble shower surround.
Ruby & Quiri also helps keep costs down for customers by using skilled installers, who Young refers to as “mechanics.”
“We have good mechanics who don’t waste a lot of product. A lot of people think you need 20% extra tile for a project when in reality you don’t need any,” Young says. “We have mechanics who are superior quality people who have just as much interest as we do in having those jobs come out as perfect as possible. They get paid very well and they tend to have skills other [installers] don’t have. Our best tile mechanic can build a whole bathroom from scratch. The fewer people a customer has to deal with, the better.” Every business card has the telephone number of the store owner. In the unusual case when there’s a problem, the customer doesn’t have to deal with the mechanic directly.
In nearly every case, Ruby & Quiri sends a design expert out to the customer’s house to help with the selection of paint colors and other design issues. About a third of Ruby & Quiri’s flooring customers are doing a complete room remodel, but many are just doing an upgrade. There are a lot of older homes in the area that need updating, and not a lot of new construction.
Ruby & Quiri doesn’t run many promotions specifically for tile, but Young says they’re going to move in that direction this year. However, the store promotes its design center heavily, where ceramic, porcelain and stone are all on display.
The firm also doesn’t keep much inventory on hand. “It doesn’t pay to guess what a customer is going to want, so typically we order on a special basis,” Young says. “The distributors are usually very quick and we have the tile within a week to ten days.”
Tile is a growing portion of the overall flooring business, Young says. Today it accounts for about 30% of business, with hardwood at 25% and carpet at 45%.
Bullnose sells all kinds of tile at all price points for all kinds of applications but bathroom projects make up a large share of business, says general manager Danielle Brassfield. It doesn’t offer financing because it doesn’t want the hassle, and it doesn’t sell on account because of problems collecting from distressed contractors or homeowners.
A surprising amount of business comes from homeowners, like previous customers, who may need to patch or repair a floor or wall, which is how the business began 18 years ago. Because of its large inventory, Bullnose can almost always match the existing tile, saving customers a lot of money.
“During the downturn, people were still coming in to do patch and repair jobs and, since other [retailers] don’t have anything, it’s been a big boost,” Brassfield says. “We never lost sight of how we began.”
The Bullnose showroom is much different from a typical retail outlet. It’s in a house setting and it features a series of life size home vignettes, so, for example, a customer can climb into a completed shower and get a sense of what it will look and feel like. That’s especially useful for showing off both the tile and the high-margin Schluter products.
The showroom also helps set it apart from the competition, which is intense. Bullnose is located in an area known as Tile Row. Eighteen years ago there were probably six other vendors within a six block radius but today there are about 40, Brassfield says.
While Bullnose directly imports a huge amount of product, it specializes in attractive closeouts. Brassfield has regular staff meetings, meets with vendors, and attends the major trade shows to get a sense of what products to buy. Today, travertine is largely out, greys are in, minimalistic looks are hot, and metal trim is popular. Large format 12” by 24” wall tiles are its biggest seller, and customers are gravitating in general toward tile that uses inkjet technology for improved visuals.
Roughly 90% of sales come from stock items, and the average bathroom sale is probably about $1,500, with the mid prices points the biggest sellers. Bullnose avoids low cost, low quality Chinese products with low margins. “We’re in business to make money,” Brassfield says. “If we sell low quality or low margin products, how are we going to serve customers?” The firm also never has sales events.
The firm has backed away from traditional advertising, where it used to spend a lot of money, and has largely abandoned its company website in favor of a Facebook page. The Facebook page contains everything from numerous shots of completed customer jobs to breezy announcements about drawings and training events.
“We’ve also had tremendous success with online reviews,” Brassfield says. She says that a lot of business is coming as a result of the online review service Yelp, where customers post unsolicited reviews. As of this writing there were more than 50 reviews, most of them highly complimentary, and Bullnose came out first in a search for tile stores in San Jose.
Brassfield also says that much of the store’s success comes from taking care of its people. “We have zero turnover,” she says. “We’ve been at the same location for 18 years and having familiar faces is important. We also give everyone, even people in the warehouse, the opportunity to make sales and earn spiffs. Our showroom on a Saturday might be crazy packed,” so warehouse workers can help out.
“They are able to give themselves raises and it makes them feel good that they are part of the team.”
Bullnose also provides medical coverage, and gives bonuses when the firm does well.
Copyright 2012 Floor Focus