Best Practices - April 2013
By Sonya Jennings
Staying in business for 98 years is a rare and coveted achievement, and O’Krent’s fourth generation owner Sam O’Krent seems to be gearing up for the next 98. Spending nearly 50% of his time on community involvement, he makes a serious effort to keep himself and his company woven into the fabric of the San Antonio community.
O’Krent’s also stays visible with many new initiatives to drive store traffic, and the store’s new payment policy is bringing a higher level of efficiency. Three years ago, O’Krent’s payment policy was changed, and Sam O’Krent says it is one of the best business decisions the company has made.
O’Krent’s payment policy change was implemented during the worst of the recession, when store employees were spending a lot of time attempting to collect payment. The new policy requires 100% of payment upfront and before installation. A 50% deposit can be made in the store, but when the installer arrives on day one of installation, he is to collect the remaining 50% or the job is not installed. This has cut wasted manpower hours, as no employee has to spend time tracking down customers for payment. Customers are offered financing through GE if they qualify and choose to go that route, but either way, all money is collected up front. Store sales associates explain this policy to customers by communicating that O’Krent’s is in the flooring business, not the credit or finance business, so if financing is desired, then a credit card or GE financing can help satisfy that need. Sam O’Krent comments, “Our greatest fear was that we were going to lose business to our competitors who did not have the same payment requirements, but I can count on one hand the number of jobs we’ve lost due to this policy. I tell the customers that we are a trusted local company, and here is the door to my office, open at any time to you.” The company has a reputation for high quality work and customer satisfaction, so this has allowed the payment policy to work for both the customer and the company. The sales people at O’Krent’s really like the policy because they are paid when the customer pays—no more waiting weeks or months for a customer to make payment on a $10,000 job.
To drive store traffic, O’Krent’s recently changed its advertising strategy. The store was advertising through television, social media and newspaper inserts; however, the results were not justifying the expense, so the company is now trying different avenues to pull customers into the store. Radio advertising with testimonials from popular radio personalities has been an effective change for O’Krent’s—store ads can be heard on a local conservative talk radio channel and an easy listening channel. Pay per click search engine marketing is also working well. The company spends approximately 3.5% of sales on advertising.
Building an online reputation on Angie’s List, a consumer review site, has turned out to be a successful method of attracting customers to the store. O’Krent’s has the “Angie’s List Super Service Award,” and less than five percent of companies have this designation. According to the Angie’s List website, more than 1.5 million households use Angie’s List to find high quality service companies in their local communities. The Angie’s List Super Service Award logo is featured on O’Krent’s website. Anyone can click the logo and go directly to reviews by local consumers. After each installation, customers are given the Angie’s List survey to either mail into Angie’s List or complete online. These reviews never go back to the store, which adds another layer of trust between Angie’s List users and the featured companies. Sam O’Krent adds, “Testimonials on our own website are important, yet most consumers understand that we will only post positive feedback on our own site. Angie’s List is unbiased, and therefore trusted. Also, we do not shy away from negative feedback on Angie’s List…it gives us an opportunity to publicly address a situation with integrity, which in the long run can have a very positive effect on our business.”
Installing a large digital sign in front of the business has also helped to increase store traffic. O’Krent’s is located at the intersection of two main highways in San Antonio. Even as major highway construction caused 25% less traffic to flow through the area in 2012, retail volume was up 3% for the year. Sam O’Krent believes the digital sign, installed in May 2012, successfully gains the attention of commuters moving through the area.
Sam O’Krent, his wife Margie, who is CFO of O’Krent’s, and the rest of the staff build the brand of the business organically with a focus on community involvement. Many companies say that they are involved in the community, but Sam O’Krent estimates that nearly 50% of his time is dedicated to community organizations. He and Margie sit on boards for many civic and charitable organizations, including the Rotary Club, American Heart Association, Cancer Therapy Research Center, South Texas Blood and Tissue Center, and many more. They began the Arthur O’Krent Golf Classic, a yearly tournament honoring the memory of Sam’s father, which has raised $750,000 for the American Heart Association. According to Sam O’Krent, “The culture of our company is one that encourages involvement in something greater than self, and our employees take that seriously. When our employee volunteers at the homeless shelter, he or she receives paid time off. If our employee joins the Lion’s Club, we are paying the dues.” Organizations in San Antonio know that O’Krent’s will be donating in some way when they have a gala or a silent auction to raise money for a good cause.
O’Krent’s Abbey Flooring Center sales are approximately 60% hard surface and 40% carpet products. In 2001, the split was more like 35% hard surface and 65% carpet. Although the trend over the past decade favors hard surface, Sam O’Krent sees a renewed interest in carpet due to the innovative products being introduced into the market. O’Krent’s sales are 80% retail and 20% commercial, and the store serves the mid to upper end retail market. O’Krent’s is an Abbey dealer, and to bring on a vendor outside the Abbey system, the vendor must be special. According to Sam O’Krent, “We choose vendors who have the same care and concern for the end user that we do.” His goal is to make every customer happy and sell ten of her friends. He looks for vendors who believe in that philosophy as well. They demonstrate commitment to this by handling claims with attentive and prompt understanding. He adds, “The goal is not to go back and forth with the client, it’s to make her happy. Every once in a while, things will go wrong, and it’s how you handle those problems that matters.”
When asked about his greatest challenge, Sam O’Krent says it’s the unknown of the current economy. During the recession, there was less money for luxury goods. His hope is that we are moving toward a stronger economic position as a country, but there is no guarantee of that happening. He expects retail business to uptick in 2013, and he wants to focus on gaining more of the commercial business in San Antonio.
O’Krent’s was founded 98 years ago by Sam O’Krent’s great grandfather, Samuel O’Krent. The business began in Cincinatti, but moved to San Antonio in 1936. Sam O’Krent believes the move was prompted by pressure to unionize. When looking for a place to relocate, three cities were suggested as good places for business: Peoria, Illinois, Sacramento, California, and San Antonio, Texas. After considering all three cities, San Antonio was chosen and has been home to the company ever since. Today, the company offers carpet, tile, hardwood, laminate, natural stone, and area rugs. It operates in one 34,000 square foot facility with a 14,000 square foot showroom.
Copyright 2013 Floor Focus
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