Article Number : 3514 |
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| Date | 8/1/2008 10:19:46 AM |
| Written By | LGM & Associates Technical Flooring Services |
| View this article at: | //floorbiz.com/BizResources/NPViewArticle.asp?ArticleID=3514 |
| Abstract | By K.J. Quinn A little over a year since restructuring its commercial flooring business, LG Floors reports the bold moves made by the company are paying off. Last year sales doubled over 2006, and the firm reports boosting its share of the commercial resilient flooring business... |
| Article | By K.J. Quinn A little over a year since restructuring its commercial flooring business, LG Floors reports the bold moves made by the company are paying off. Last year sales doubled over 2006, and the firm reports boosting its share of the commercial resilient flooring business. Meanwhile, pent-up demand for restyled vinyl sheet and floor tile lines coupled with an investment in sales, marketing and technical support are solidifying LG’s position in targeted end-use sectors. “LG has a proven track record of success under the circumstances,” said Harry Brownett, vice president, sales and marketing. “We are now simply translating that success into the floor covering market.” LG Floors has been manufacturing commercial resilient flooring since 1961. Things have gone exceedingly well for the Kenilworth, N.J.- based company ever since a new management team, headed by Brownett, was hired to drive North American sales early last year. It was a precarious time to take over the reins as commercial resilient flooring sales were slipping industrywide and LG split from its former U.S. master distributor, Associated ACC/Innovision, in November 2006. “There was a lot of confusion early on, complaints and skeptical sales partners who weren’t sure what the destiny of LG Floors was,” Brownett recalled. Mike Welch, president, E.J. Welch, a St. Louis-based LG Floors distributor, was one such skeptic. “We were a little concerned when LG dissolved that relationship,” he said. “But our experience with them has always been very positive.” With the backing of parent company LG Chem, an $8 billion global player in the industrial materials sector, LG Floors was able to leverage its vast resources and knowledge base. “We are a fully integrated manufacturing and distribution global network with no middle men to drive up costs,” Brownett said. “That’s one reason we are having success: We offer the shortest route to market with minimal cost.” The LG brand, a recognized name for industrial products, was also a big help. “Many of our customers have had successful experiences with purchasing other products manufactured by LG, creating a positive frame of reference from which new buying decisions are made,” Brownett said. Investments were made to improve LG’s sampling system and inventory control while new patterns and colors were developed for the U.S. marketplace. As all this was happening, the management team—with experience and a solid track record in the resilient flooring business— solidified LG’s distribution network and reassured its business partners. “We called them and said, ‘Look, there is a lot of uncertainty now, but give us 90 days to come back with a plan that will work,’” Brownett said. “We wanted to keep things simple and not scare anyone off.” Indeed, “S.I.M.P.L.E.” is an acronym which represents the six core building blocks for building LG’s business: samples, inventory controls, management, product design, leadership and brand, and exceeding (customer) expectations. “We want to go out and do things better than everyone else and win because of that,” Brownett said. To that end, LG developed a new sampling program that made it easier for potential customers to see, feel and understand the line. Inventory controls were implemented to ensure customers had products when and where they needed them. The resilient flooring lines underwent a makeover— new styles and colors received rave reviews at Surfaces, observers say—and the redesigned line continues to roll out through 2008. “It’s an incredible quality of product,” said Mike Patton, managing member, The Patton Group, a Brisbane, Calif.-based LG distributor. “It’s really been a joy to distribute and then get LG’s products installed. We have not come across a single installation-related issue.” The new lines consist of five commercial flooring collections available in distinctive designs and colors for a wide range of healthcare and commercial applications, providing durable, anti-bacterial vinyl floors that are easy to maintain and install. “In LVT (luxury vinyl tile), woods are becoming darker and more rustic following the lead of real wood,” Brownett said. “Manufacturing technologies were designed to produce embossed in-register floors—wear layers and surface visuals duplicating hand-scraped and weathered wood products.” Produced and imported from South Korea, LG’s flagship product is Naturelife, a heterogeneous sheet vinyl featuring an in- register embossed surface replicating natural hardwood and available in 25 wood grains. “Our wood patterns are much better colored from light to dark,” Brownett noted. “The real wood is going toward medium to dark tones, and we are on top of that trend.” Naturelife Rustic, a sheet vinyl flooring, recreates the warmth of aged hardwood. It is available in 6-foot wide, 50-yard rolls. Five pine finishes and two paulownia (a wood species native to southeast Asia) finishes are available. Deco Stone/Wood LVT comes in life-like wood, stone and metallic visuals, allowing end users to create a floor fashion statement for commercial interiors, including retail, healthcare and education facilities. A new 18 x 18 floor tile, Hologram, offers a glittering surface and “sparkly” texture. “We’re trying to make things easier for the designer and serve as a one-stop shop by giving them options within our line to expand their designs,” Brownett said. Rounding out the resilient offerings are Artwalk, a smallscale, low-profile, textile surface featuring three-dimensional designs and available in 20 contemporary styles and colors, and StaticPulse ESD Control Vinyl Tile. “We give designers and dealers a reliable product line and recognizable brand to bring to their customers,” Brownett said. “Once they see the quality of product, color and pricing, it’s a sale that can be pulled through easily by the dealer salesperson, and easily sold or presented by the designer who wants to get the job done on time.” In a sea of resilient floors closely resembling natural materials, what distinguishes LG products is the value proposition, high style, durability and environmental benefits, distributors say. Products are competitively priced and contain post-consumer content, both of which are major selling points to the price-conscious A&D community. “LG products look great and perform, and are sold at price points that fit their target market,” said Welch, LG Floors representative of three years. LG Floors is taking manufacturing and environmental stewardship to the next level by discovering ways to not only incorporate post-industrial content into its product mix, but utilize its own post-consumer recycled content. “LG is domestically reclaiming its own product—as well as the competition’s material— from individual households and end users, and reusing it to make floors again,” he explained. “This is the closest any resilient flooring manufacturer has come to producing material in a closed loop process.” Since this technology is so new, in the coming months LG said it will quantify accurate percentages and articulate a complete sustainable message in light of these new advances. “If I’m dealing with an A&D firm or end user, many of them are fast forwarding into the green movement and have a hard time with vinyl,” Patton Group’s Patton said, noting there is misinformation circulated about the category. “We have to recognize the limitations in the marketplace for the product. Plenty of people are using vinyl, and we just avoid people who are misinformed and want to use natural products.” Resilient has long lagged behind carpet and others floors in producing environmentally preferred products, industry members say. “We are very committed to making resilient flooring green,” Brownett said, noting LG is a member of the U.S. Green Building Council. “I feel green is its own market segment to some degree, transcends all segments, and we need to be aware of it.” So far, LG Floors reports it has not entirely felt the effects of the economic slowdown impacting the residential flooring business. “In fact, we are seeing a growing number of inquiries from residential distributors and retailers about our commercial products,” Brownett reports. “Commercially, our LVT and luxury sheet sales grew at double-digit rates during the first half of the year. Our monthly sales, backlog and projected forecast remain strong.” A case in point is St. Louis University, which recently specified 20,000 square yards of Naturelife for its residential dormitories, Welch said. “We have been getting a lot of repeat business with design firms that have used the product in the past.” Future success will depend largely on the emergence of new technologies to make manufacturing more efficient and environmental friendly. Although petroleum-based products have been the standard for nearly 50 years, it appears that alternatives are emerging from the biotech arena. For example, “agriculturally based plastics are reality now,” Brownett said. “However, they have not yet reached a level of advancement where they perform successfully as floors. “Once this technology reaches the stage where it performs equal or better and costs equally or less, we may see dramatic change in the resilient flooring market,” he added. “The future cost of oil is likely to have a major influence over the destiny of alternative plastics.” Aside from economic impacts, an ongoing challenge is moving LG’s products in front of the right people, Brownett said, and placing sales and marketing tools into the hands of designers and dealer salespeople. “The only way for us to successfully grow our business in a competitive market where the pie is shrinking is by taking business away from our competitors. Whatever customers think they want, we’re going to give them more.” |