GOING UP: Amid speculation and concern expressed by its distributors, Congoleum has notified them that it will increase prices “about 5% on all products...effective between the middle and end of January.” Though details were not set, Congoleum wanted to give distributors an opportunity to prepare for the increase—adjust budgets, update price lists, notify retailers. The manufacturer’s last increase was in May, and since then vinyl resins have risen 6% to 12% (averaging 7% to 8%); plasticizers have been more erratic, going up 13% to 14%, with another 6% increase due at the end of the month. Limestone costs haven’t increased, but the expense for transporting it has. The company explained, “This 5% increase will not be fully offsetting, but in the current state of business that’s probably the most that can be done.”

GEARING UP: Empire Today, the television retailer that promotes in-home shopping, has announced its 2008 Customer Focus Initiative, which features “next-day installation and warehouse-direct pricing on carpet, flooring (wood, laminate and ceramic), window treatments and bath renovation products.” It will no longer offer custom windows, siding or gutters, which account for less than 5% of its revenue and does not fall in the realm of next-day installation. It is interesting that Empire Today sees itself as “a provider of installed home furnishings” and not as a home furnishings retailer, though it did fit that description when it started in business 45 years ago. Today, it is in more than 50 locations in the U.S. and Canada.

MERRITT-ORIOUS: Randy Merritt, president of Shaw Industries, keynoted the Chicago Floorcovering Association’s recent State of the Industry Dinner, and the overflow audience of more than 300 loved it. Merritt was candid and made observations without sugar-coating, citing the current difficulties in the residential market caused by the slowdown in the housing sector, which bloated the inventory, a staggering number of foreclosures, and diminished equity borrowing for remodeling activity in retail. He said carpet sales were down 8% to 10% overall, and it breaks down this way: builder business dropped 25% to 35%; retail sales are down 8% to 10%; multifamily dwellings, flat, and commercial off 2% to 4%. He was just as critical of hard surface categories. He said wood was off 8% to 10%, laminate down 4% to 6% and vinyl off 8% to 10%. But there was a flicker of good news: the only portion of the flooring business that was ahead for the year was carpet tile, up about 15% to 20%.

MORE MERRITT: The keynoter continued on a high note, pointing out that the carpet industry has grown at the wholesale level from about $8 billion in 1996 to $12 billion in 2006—a 50% increase in 10 years. Merritt was interesting and informative, and he offered the audience some of his insights: Worry about things you can control and when you have control, be positive and aggressive… Have a strong Web strategy. Two out of three consumers are shopping on the Web and those numbers will grow. If they cannot find you on the Web, they may not find your store…Control costs, but cut fat not muscle. The tendency is to cut too deeply, and when business rebounds, you have to spend more to get the muscle back than it would have cost to keep it. In good times we all add fat that can be cut. Look closely…Achieve balance. If your market is 69% carpet and 40% hard surface, and your showroom is 90% carpet and 10% hard surface, you are not balanced and missing business in both areas. It was a memorable night, a compelling speech and vintage Merritt.