The Flooring Gallery: Best Practices

By Sonya Jennings

Located in Kentucky and Indiana, The Flooring Gallery is a strong middle-America flooring company. Numbers have been steadily improving over the past couple of years, following the country’s economic downturn. During the hard economic times, the company did not lose one key employee, a testament to the employee relationships at The Flooring Gallery. When asked how his company has achieved success, president Nick Freadreacea states, “We have loyal employees, many that have been with us for a very long time. We track everything, and there are basic systems in place for every aspect of our business.”

The Flooring Gallery’s sales are 50% retail and 50% builder market, including new construction and multi-family. This provides stability for the company overall. According to Freadreacea, “Oftentimes, when retail picks up, the builder market lags, and vice versa.” When consumers are buying new homes, retail sales tend to slow as people are moving instead of remodeling; in addition, when homeowners are staying put in their homes and home sales are lagging, they are likely to remodel, which positively affects retail sales. He adds, “Of course, we have those great years when both retail and builder markets are strong, but having a presence in both markets protects us in the years when that is not the case.”

On the builder side of the business, The Flooring Gallery is a member of Floor Expo (FEI). The company joined this group for the buying benefits and availability of great ideas from other members. According to Freadreacea, “My Floor Expo peers on the California and Florida coasts usually see trends two or three years ahead of my location in middle America. This helps me to accurately predict what is coming to my market and prepare accordingly.” He also points out that, with any new trend, the bulk of sales happen in the first couple years, so he is prepared ahead of the arrival of many flooring trends.

On the retail side of the business, 4% of The Flooring Gallery’s retail sales is spent on store advertising. To drive store traffic, the company invests heavily in radio advertising. About five years ago, a popular contemporary mix radio station in Louisville approached the company to sponsor the radio station’s broadcast studio. This means that all throughout the broadcast day, the radio DJ says, “Broadcasting from The Flooring Gallery studios.” The radio station’s listening area includes all four of The Flooring Gallery’s Kentucky locations. As the number one station for The Flooring Gallery’s target audience, female listeners aged 35 to 65, this radio station provides a valuable means of advertising. According to Freadreacea, “Having the store name mentioned throughout the day to our target customer has proven to drive store traffic—it’s one of the best advertising decisions we’ve ever made.”

Twice a year, the company has a two-day tent sale—one in March and one in late October or early November. On the first day of the biannual tent sale, the radio station sets up a live remote broadcast from 5:00 a.m. to 11:00 a.m., giving away prizes and promoting the event. These two events are the most profitable days of the year for The Flooring Gallery.

In addition to sponsoring the radio broadcast studio, The Flooring Gallery also hires the station to help write and produce radio commercials with creative hooks, including a recognizable jingle set to a catchy tune with the tagline, “Your home’s best friend.” This jingle is also used in the company’s television commercials, providing cohesiveness in the message. Commercials are based around a particular promotion that is ongoing at the time of broadcast. For the Indiana store locations, the company advertises on a popular country music radio station.

Broadcast television is another way the store attracts customers in both the Kentucky and Indiana markets. The television stations produce the commercials, and they are aligned with the radio advertising. Radio is the main focus, as it is more difficult to get people to sit through commercials with all of the options in television. The store has a website and will occasionally send email blasts and launch Internet promotions, but generally speaking these have not been all that effective in driving store traffic. Angie’s List is a new venture for the store in its search for an Internet avenue that produces business. The Flooring Gallery has both a Twitter account and Facebook page, but these are not sales drivers.

Freadreacea, recent chairman of the World Floor Covering Association, feels that tracking customer service is a valuable part of keeping the company on the right path. After every Flooring Gallery installation is complete, the customer is given a response card and encouraged to complete and return it. All of the responses go directly to Freadreacea. Once a month at each store’s sales meeting, the comment cards are read out loud. Any weak areas are discussed, and a plan is made to conduct further training on that topic. The positive feedback is shared, which provides store employees with that all-important pat on the back for a job well done.

The company’s installation crews are contracted, so the store managers make a special effort to pull their contractors aside and share the feedback from customers. Freadreacea says, “Most of our installers don’t hear that feedback from customers, but we make it a priority to share the information with them.” The responses are almost always positive, and that gives the installers the recognition they deserve. In the cases where it’s not good news, it gives them the tools they need to improve.

The Flooring Gallery has many long-time employees, but when a new salesperson is hired an extensive training period follows. At least four to five weeks of training is required to learn the company systems before the new person is allowed to speak with a customer.

Training a new employee is just one of the many systems in place. The Flooring Gallery is a systems-oriented company with basic procedures on sales, customer service, scheduling, and follow up. The systems are reviewed every couple of years and updated as needed. Freadreacea comments, “It is sort of like a franchise in that there are systems in place for every aspect of the business. No employee has to reinvent the wheel to do his or her job—although they are always allowed to use their own discretion. In other words, there is a formula with no script.”

When asked how he decides which products to carry, Freadreacea replies, “We track closely, and we let our people guide our buying decisions.” Every year at the end of October, the company’s salespeople at each store location vote on every product—they rate each item on a scale from one to five. The company’s main buyer goes to each store location collecting feedback from the sales staff, and that information is compared to actual sales data. The sales opinions always vary from city to city, as what is hot in one location may not be in another. Salespeople really like having such a strong input on what the company sells. Once all of the figures are in, the company has a blueprint for what to target in January at the Surfaces trade show.

Commenting on recent overall product trends, Freadreacea notes, “For a while hard surface overtook carpet, but since the economic downturn, carpet has come back and now they are about even.” He also names luxury vinyl tile and luxury vinyl plank as his fastest growing product lines. He believes these products answer many customer requests and concerns including great visuals, easy cleaning, low cost, warmth and ease of replacement. At The Flooring Gallery, luxury vinyl product sales have tripled in the past two years.

Started in 1967, the company first operated under the name Kinnaird & Francke. In 2000, Freadreacea purchased the company and changed the name to The Flooring Gallery. The company offers carpet, hardwood, ceramic tile, natural stone and luxury vinyl.