By Louis Iannaco
During this time of economic woe, retailers need all the ammunition they can in order to get the sale. Whether it’s spring sales, roll specials or credit programs, flooring dealers are being more creative than ever when it comes to securing consumer confidence. Does credit make a difference when it comes to purchasing floor covering? According to several veteran dealers, the answer is a definite yes.

Aaron Pirner, CEO of CAP Carpet in Wichita, Kan., said, “We offer all kinds of credit. However, with the jump in cost (or unavailability) of No/No term offers, we are being more selective with these offers. Credit still sells flooring.”

With banks tightening things up, he noted, a lesser percentage of approvals are going through, making for a lower percentage of consumers getting credit. “The credit crunch nationwide has affected credit approvals and ultimately, credit sales in the Midwest,” he said.

According to Gary Cissell, director of flooring for the Nebraska Furniture Mart, offering a wide range of credit options is key to making sales. “We continue to advertise heavily, and we continue to offer a wide variety of credit plans. Our most popular plans involve 12, 18 or 24 months, no interest, making equal payments. We have not varied our approach to credit over the last two years.

“We have seen approvals tighten,” he explained, “and in some cases, we require the consumer to have a little skin in the game, such as a deposit.”

‘No interest’ equals sales

Chris Kemp of Kemp’s Dalton West Flooring, a family-run operation, also noted how offering diverse credit plans is crucial for business. “We offer six months, same-as-cash. We also offer 12 months, same-as-cash. We try to offer anything the big boxes are offering.

“I really don’t think it’s very important exactly which plan it is,” he explained, “as long as it costs the consumer absolutely no interest or any hidden charges. I don’t believe the financing is different than before. But if the consumer can use someone else’s money for free, they are quicker to use it than in the past.

“I still find people surprised that we can offer no-interest financing like the big box stores offer,” Kemp added. “One thing that has helped us is putting the credit application on our Web site and allowing the customer to get qualified prior to coming into our stores.”

Unlike Pirner and Cissell, Kemp doesn’t see consumers in his market area having many problems acquiring credit. “Most of the credit applications we run get approved. People seem to know if they are going to get approved or not. It really doesn’t seem to be tightening up at this point.”

Current spending habits

Are consumers currently spending more on the average purchase due to/because of the availability of credit programs? According to Cissell, average purchases are the same or slightly higher than last year.

Kemp stated, “Our customers are definitely spending more per invoice than ever before, just not as many invoices. Today, if a customer comes into our store she is ready to buy. And yes, she will spend more money if she can digest the expense over a period of time.”

Pirner noted, “Today’s challenge for the flooring industry is to ask the customer to continue to purchase quality that will make her happy for years. It has been and will always be easy to sell lesser quality goods to make the sale. But customers should be asked to purchase quality material that will last and make her delighted with her purchase decision—now more than ever!

“When we are worried about our pennies,” he concluded, “we shouldn’t buy something too cheap and have to buy it twice because it didn’t perform. Credit is an easy way to afford the quality that our customers deserve.”