Article Number : 4518 |
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| Date | 5/29/2009 8:54:35 AM |
| Written By | LGM & Associates Technical Flooring Services |
| View this article at: | //floorbiz.com/BizResources/NPViewArticle.asp?ArticleID=4518 |
| Abstract | By Steven Feldman CABO SAN LUCAS, LOS CABOS, MEXICO—When the National Floorcovering Association (NFA) convened for its spring conclave here April 28 to May 1, winds of change—as in to the bylaws— were in the air. But in the end, the 31 members in attendance who braved the swine flu scare opted to... |
| Article | By Steven Feldman CABO SAN LUCAS, LOS CABOS, MEXICO—When the National Floorcovering Association (NFA) convened for its spring conclave here April 28 to May 1, winds of change—as in to the bylaws— were in the air. But in the end, the 31 members in attendance who braved the swine flu scare opted to favor the status quo—at least for now. NFA is more like a fraternity than your typical flooring group. While the association is comprised of some of the largest floor covering retailers in the country, having a roster of just 35 members allows for a certain degree of intimacy. Yet to be more important to its core vendors, the group realizes it does have to grow. And this is where the debate lies. Right now, to obtain membership in the NFA a prospect must have 100% approval. NFA’s bylaws are such that any one member can block a potential member from joining—for any reason. The primary purpose for the one-vote block is territorial protection. Given that NFA members regularly share their best practices—in fact, it is a requirement—no member in his right mind would ever open the vault if his competitor was in the room. Of course, the one-vote block can negatively impact the group if the privilege is abused. For example, one member can hold the group hostage just because he has a personality issue with a prospective member. It has happened before. And this personal bias is an impediment to growth. It was in that spirit that a proposal to reduce the new member approval rate to 80% was discussed. The desired effect would be to keep personalities out of the voting equation. But when the proposal was put to a vote, it failed to generate the requisite two-thirds membership approval. “I think with any organization, change comes slowly,” said Jeff Macco, Macco’s Floor Covering Center, Green Bay, Wis., and NFA president. “This was a fundamental change as to how the NFA had been run in the past. A lot of guys have to try it on, wear it, think about it. Changes are good, but this one needs more discussion.” Macco advised that the resolution could pass if it is brought up again at the NFA’s fall meeting in Naples, Fla. That’s because the resolution fell six votes shy of approval, the exact number of members whose attendance was claimed by the swine flu scare. “Who’s to say those six votes wouldn’t have made the difference,” he said. In any case, Macco said in the future every member will be made aware of all resolutions to be voted on in advance of each meeting so they can give a proxy. It came as no surprise that the resolution did not pass after FCNews found a dichotomy of opinions in casual discussions with members early in the conference. Executive board member Jim Jensen, Carpet Mill Outlet, Denver, seemed to favor the passage of the resolution. “The benefit would be that it would provide a mechanism for the group to move forward in an area that would be stymied otherwise,” he said. “The group understands each other’s situations, so geographically everyone respects one another. It would avoid, for example, someone not being voted in because one member didn’t approve of the color of his hair. At the end of the day, if I can’t rally eight of my brothers to agree with my point of view that a person should be blocked from joining the NFA, then maybe that member should be in.” John Pierce, Pierce Flooring & Design, Billings, Mont., favors an 80% approval threshold because of the growth factor. “As we get larger, the one-vote veto doesn’t make sound sense. To have a viable member stifled by one negative vote is not practical. When we were smaller, we had the luxury of dominating our respective marketplaces. If it occurred that a current member was experiencing a dramatic decline in sales, should he be able to block a potentially strong member? In order for the NFA to recruit the leaders in any given marketplace, we have to be more open minded, even in areas where there may be some territorial crossover.” Bill Codgill, Contract Funishings Mart, Portland, Ore., was among the most vocal in his opposition to the change based on ramifications that could change the entire nature of the NFA and the principles on which it was founded. “The day we start overriding a few people, that’s when there will be animosity within the group. We want this to be a friendship deal. Once you poison it, it ripples through the group and then you don’t have a bunch of friends. Our group is more like a fraternity. “Also, I’d have a hard time talking about my best practices if my competition was in the group. Hey, I look forward to this trip. I don’t want to not look forward to it because my competition is here.” Alan Braunstein, Worldwide Wholesale Floor Coverings, Edison, N.J., also favors the status quo. “If it ain’t broke don’t fix it. The existing policy has worked for this group for years. Past president Sam Roberts recruited some great new members into the group, and I think there is an opportunity to bring in more great members without changing the bylaws.” Clyde Cumbie, Carpet Exchange, agreed with Braunstein. “It needs to stay unanimous, because that potential new member may be in your backyard. It doesn’t matter the reason— geographic or personality. There are a lot of dealers that don’t fit this group because of how we do business.” Other issues on the table NFA currently requires its members do a minimum of $10 million in business or, at the very least, are close but also the market leader. There was some discussion to raise that threshold, but it was never put to a vote. Also on the table was the realization that a member may sometimes drop below the $10 million mark, and there is no mechanism for monitoring a member’s business. To that end, a resolution to verify members’ continued certification via rebates— which can be policed—was proposed. That, too, failed to garner enough interest. The thought was that in this economy it is to eliminate a member who drops below the threshold. “We are more interested in them being an active participating member,” said Jim Mudd, Sam Kinnaird’s Flooring Outlet, Louisville, Ky. “If they have something to bring to the group, we are willing to wait it out.” The other side of the story, as explained by Macco, is that the NFA must maintain a very high integrity with its vendors. “If we tell them we are the biggest, we have to make sure we maintain that.” And Jensen favors rebate verification because, as he noted, it doesn’t benefit the group if the members are not “buying significantly” from NFA-approved vendors. “So rebates are a good way of addressing those members who are supporting the programs the NFA is building.” Macco also made a case for raising the minimum requirements for membership. “We set a $10 million threshold when the NFA was first initiated, and there has been some discussion whether to increase that number,” he said. “The reason would be to entice vendors to cut deals to very large retailers that they may not cut to smaller retailers because of the way each of our members can buy. So we are looking to encourage more large dealers to join our ranks, which in turn allows us to negotiate more favorable deals with vendors.” Pierce believes in raising the threshold, but the current economic climate is not right. And Braunstein believes it should have more to do with the quality of the retailer and how it fits within the organization. And if it ever gets to a dollar issue, overall revenue per store may be a more telling formula. |