Best Practices: Ted’s Floors & Beyond, Floor Depot Plus – Feb 2024
By Jessica Chevalier
Ted Gregerson was 28 years old in 1996, when he opened the business that is now Ted’s Floors & Beyond and, only six years later, a second, differently branded operation now called Floor Depot Plus. Gregerson’s goal has long been to “own a business and not a job,” so from the early days, he focused on building a management team empowered to run the operation.
DIFFERENTIATING
Gregerson’s businesses began as an Abbey franchise operation with his first location originally branded as Ted’s Abbey Carpet & Floor and the second as Floors To Go-more on the name changes later-after an introduction to the flooring business by his father, who was the right-hand man for the owner of three Carpet One stores during Gregerson’s teen years. Gregerson joined the warehouse crew of those locations at 15 and went full time when he graduated high school, beginning as the helper of an installer and, within two years, running his own crew-and later moving into sales and store management.
A month or so after Gregerson stepped out on his own and opened his first location, he asked his childhood best friend, Ron Hurley, to join him in the enterprise. Hurley is still with the business today, serving as president.
The company grew large enough in 2003 that it needed a separate warehouse. Gregerson and Hurley found a suitable 22,000-square-foot building on the opposite side of town. Gregerson recalls thinking, If we keep inventory here, why don’t we also name it, put a sign over the door and sell from here?
Gregerson was determined to keep the stores different in name and style. Ted’s is an upper-end location with nicely displayed products catering to the “country club lady,” says Gregerson. Floor Depot Plus is a warehouse-style store with a rack system to the ceiling. “They don’t look at all like they are owned by the same business. If the consumer gets estimates from the two of them, we win either way. And through the years, that has happened. They are the two biggest flooring retail stores in the area. Today, Floor Depot Plus is a $4 million dollar operation.” And Gregerson notes, “I don’t think it would have doubled business if we’d used the same name,” as the consumer would have felt compelled to go to a third-party location for a second quote.
The Floor Depot Plus location holds over $1 million in inventory. And the stores do carry some of the same brands and product lines with Ted’s also carrying a higher-end offering, including Karastan and Godfrey Hirst.
FLOORING & BEYOND
Ted’s and Floor Depot Plus operate a restock program that is a cornerstone of the business, accounting for 80% of sales. Gergerson says, “If we tell our suppliers that we will do a certain amount of volume, we will do it. And we get good pricing because of that, which gives us an edge, so these products are in stock and priced right.” He reports that all his suppliers want to be a part of the program.
While both stores work of the restock program products, they display differently.
Gregerson’s operations stock 30 SKUs of good quality laminate, which they does well with. It also stock LVT, carpet and hardwood. The company also has the capability to fabricate area rugs.
In addition to the standard floorcovering products, the operation carries a large inventory of tile and stone for showers, countertops and backsplashes and offers countertops, cabinets, kitchen and bath, granite and quartz, and outdoor living.
The cabinet line, which the company picked up in April 2023, is manufactured by Wellborn Cabinet, just 45 miles sound of Anniston. On entering the cabinet business, Gregerson says, “If there is another downturn, we have things to offer besides flooring. Cabinets are a big ticket item; for the typical kitchen, cabinets cost $30,000.” Since April, the company has done $300,000 in cabinet sales out of a single store. Gregerson will add cabinets to the Floor Depot Plus offering as well. “I think it could end up as big as our flooring business,” he says.
Gregerson notes that, as his operation had been offering countertops for the last 15 years, the leap to cabinets was logical.
“Diversification is our biggest goal,” he says.
Ted’s installer team is compared of subcontractors with a total of 25 crews working on a day-to-day basis. Most have been with the business for a long time. “Many times, a business will treat subs like they are the enemy. We treat them like part of the company and include them on things,” Gregerson says.
In fact, the company includes bios and pictures of many of their installers on its website, and Gregerson explains that’s an effort to build comfort for the consumers. “Customers wonder who is coming in their home,” he notes.
In spite of having a good team of quality installers, Gregerson reports that finding new ones is his greatest challenge. “We are trying to stay ahead of it,” he notes. “But out installers are getting older, and it will be giant problem in five to ten years.”
MARKETING IS A MUST
Gregerson believes in marketing, even in a downturn. “We have a budget, and we stick to it,” he says. The two stores brands are marketed quite differently, with Ted’s working with the Chamber of Commerce, the Home Builders Association, school athletics and community law enforcement. The company holds a charity golf tournaments benefiting the community; feeds the police force during National Police Week, and hosts breakfasts for the local fire department. Its image is built on community involvement.
Floor Depot Plus has a different ethos. “When you walk in, it feels like you’ll get a deal,” says Gregerson. The store carries a lot of inventory available the same day.
Gregerson’s stores use TV advertising-but only during events that “get a lot of eyes” such as big sporting events plus some digital pay-per-click advertising. In addition, Gregerson reports that the company’s director of marketing, Gracie Jancsek, does a “terrific job” with the stores’ Facebook and Instagram efforts.
“One of the things we are known for is our annual three-day sale,” says Gregerson. During the last event in March 2023, the store brought in $1.1 million in three days.
In fact, other Abbey dealers have visited the event to learn how to construct one for themselves-and Gregerson is always willing to share strategy to help others succeed.
UP-FRONT PAYMENT
“We found ourselves always chasing money after the job was installed,” recalls Gregerson. “We were spending more time collecting than selling. Sam O’Krent, [CEO of O’Krent Flooring in Texas] gave me the idea to have customers pay in full up front. It seems impossible. But if you do it with confidence, they will write a check.”
When customers do push back, Gregerson points to his company’s 27-year tenure in the community, and he will allow customers to pay half at the time of purchase and the other half at the time of installation-but before the installation takes place.
Gregerson also takes this opportunity to sell his financing program-zero interest for 12 months. “It took my sales team a bit of time to do this confidently, but it has saved us a ton of time and turned lost payment to zero,” he reports.
OPERATIONS
“We live by a couple of principles,” says Ted. “We do the right thing and always treat people as we want to be treated. We do the right thing even if it costs us money. Many retailers think in the short term. They spend their time putting out fires and selling. I think we have grown to where we are because we have taken the time to think long term. If you don’t consider what’s causing the fires, you will always be putting them out.”
Treating people right starts with Gregerson’s team, many of which have been with the business for more than a decade. “We get employees to buy in to the way we do things,” notes Gregerson. “We open the books with them. We tell them when things are good and when they are not.”
After 26 years with Abbey, Gregerson and his team went independent on January 1. It wasn’t an easy decision. “Phil Gutierrez is one of the finest men I’ve ever met,” says Ted. “I am forever indebted to him. I called him at age 28 when I wanted to open my business, and he went out on a limb for me.
Gregerson explains his decision to step out on his own as follows, “Abbey taught us how to be pros at merchandise and marketing, how to use financing. And as we grew, we learned how to do things ourselves. We hired a director of marketing. We wanted more control over our website. We designed and created our own displays with our own headers. And it got to the point that we were doing a lot in-house ourselves, so that the ROI of being an Abbey member just wasn’t there anymore. Abbey is great for the mom-and-pop store with their teenager in the warehouse, for those don’t have time to figure out marketing and financing themselves. But as we grew our management team, we found that we needed it less.”
Copyright 2024 Floor Focus
Related Topics:Karastan, Carpet One, Mohawk Industries