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Friday, June 19, 2009

Meet Jim Gould - Floor Covering Institute Series

In this series, I introduce you to the members of the Floor Covering Institute. This post focuses on James C. [or Jim] Gould, president and founder of the Floor Covering Institute.

I first met Jim in mid 2004 shortly after he joined CCA Global Partners as chief product officer. Very quickly, I realized that his product knowledge and marketplace perspectives were unlike any I had encountered so far in the flooring industry. Not only had Jim developed a comprehensive perspective of the flooring industry, in terms of product categories, end uses possible, marketplace success and how to distribute products effectively, but he also brought a global understanding of industry dynamics. Plus, he spoke French!

Many in the flooring industry consider Jim a “visionary.” You see, he has the ability to envision opportunities before others do. Examples: Pergo laminate, Casa Italia ceramic, Resista fiber at CCA [see below for more details]... Jim examines a problem and comes away with a totally different perspective and solution. And, not just in the flooring industry...

Take St. Louis Children's Hospital on whose board he has served for the past 15 years and where he heads the Patient Care and Quality Committee. St. Louis Children's Hospital has just made U.S. News Honor Roll of Top Children's Hospitals in America - the only children's hospital ranked in the Top 10 of every measured category and it ranks #5 nationally in a study by Parents magazine.

Jim is also a past Chapter Chairman of the Young President’s Organization and chaired a week long International YPO University that included such notables as Presidents George W. Bush, Shimon Peres and F.W. de Klerk aboard Cunard’s QE2...

C.B.: Jim, please tell me about yourself.

Jim: I started my career in the family business, Misco Shawnee, in 1969. When I joined Misco we were a Mohawk Carpet distributor serving the Midwest. In those days a Mohawk distributor was only allowed to carry Mohawk carpet so that represented 100% of our business. By 1979, we had grown to be their largest distributor with warehouses in St. Louis, Chicago, Louisville and Columbus, Ohio. It was then that I was promoted to president of the company and Mohawk agreed that we could expand into Armstrong vinyl. Next to Mohawk, Armstrong was the best known name in floor covering and it wasn't carpet, thereby broadening our product selection.

We became an Armstrong distributor first in Chicago, then expanded into our other markets. In 1985, Mohawk still represented 60% of our volume when they made the decision to eliminate all distribution and service retailers direct. We had a one year transition period during which we concentrated on growing the Armstrong business and bringing in new lines like Bruce Hardwood. As a result, we never lost money!

In 1991, I started a company called Distribution Services Inc. [DSI] which took Misco’s distribution expertise and offered those same services to foreign manufacturers trying to enter the US market. With additional warehouses in Dalton and Los Angeles, DSI was ready when Pergo wanted to enter the American market.

The decision to launch DSI came about from asking ourselves two critical questions:

+ What is it that we do that is really needed by the industry?
+ If we disappeared would anyone say, ‘Gee, I sure miss Misco'?

As a result, we identified as a unique strength our market and product knowledge, combined with warehousing and logistics.

Next, we asked: who really needs that and quickly came to the conclusion that it was a foreign manufacturer with great products and no understanding of the US. For that we needed to be national, behind the scenes and a great partner. Lars von Kantzow would tell you today that we saved him millions of dollars and years of time launching Pergo because of our expertise. What I do today is no different: I guide foreign manufacturers on how to get their products into the US market.

Pergo is an interesting story. I first noticed Pergo laminate flooring in Germany in the early 1990s. It struck me as an ideal flooring product for the US market because it easily exceeded consumer expectations in performance and maintenance. In fact, consumer word of mouth became our most important advertising vehicle.

I returned to the US with samples and proceeded to talk to everyone in the industry about this new thing called laminate flooring. Through DSI, I was able to bring Pergo to the U.S., provide the parent company with the logistics and administrative services they needed to get started and took on the line at Misco before anyone else. That pushed Pergo into the U.S. market and literally changed the face of the hard surface industry.

In 1997, Color Tile, the largest ceramic flooring retailer in America filed for bankruptcy. I believed that ceramic would become another important segment of the floor covering retail offering and purchased the company.

Some history to put this into perspective. If you go back to the 70s, wood and ceramic were not sold by specialty floor covering stores. They were unique products that were sold through their own, unique channels. However, when “prefinished” wood was introduced, it was easier for the store selling carpet and vinyl to add in wood. No artistic expertise for sanding and staining was required.

Ceramic remained outside the norm for floor covering stores until owners realized that some customers “walked” when they couldn't get all flooring products from a one stop shop. Color Tile had tried to expand into carpet -- unsuccessfully (one of the reasons they went bankrupt) although expansion made perfect sense. I became partners with an Italian resource and created the ceramic line Casa Italia specifically targeting the full line floor covering retailer. My distribution network helped this unique ceramic line and other regional distributors get a foothold in that segment well ahead of others.

I sold Color Tile, DSI and Misco in 2003 with the expectation of starting a consulting business. Long time friend and business associate, Alan Greenberg convinced me to become the Chief Product Officer of CCA Global Partners instead. I was intrigued by the size of CCA and the opportunity they had to dominate the industry. I was also involved with Alan since he first thought of the concept and, like everyone else, was astounded by its success. I believe that retailers can share the cost of marketing and buying resulting in not only great savings in time and money, but also giving them peace of mind that they end up with a fair price from the supplier and receive expert advice on how to sell and merchandise. While at CCA, I saw the opportunity for a proprietary fiber to further differentiate CCA Global retailers. That's how Resista came about.

But, in 2007, after Alan’s tragic death, I left CCA Global to start my consulting business, the Floor Covering Institute LLC, where I share my expertise in flooring products, international sourcing, and channel strategies for distribution and marketing.

C.B.: How did you get started in the flooring business?

Jim: Our family business was started by my grandfather in 1912 as a second hand furniture store and auction company. With today’s modern marketing, it would have been called an “antique store.” I worked summers at the family business and attended the week-long Mohawk Carpet school in 1966 when Mohawk was still located in the Mohawk River Valley in Amsterdam, New York. Following a little time in law school and the Air Force, I joined the company as a commercial specifier for Mohawk in Chicago; one of the best jobs I have had. My father was my mentor and the Young President’s Organization was my training ground.

C.B.: What do you like most about flooring?

Jim: I love the relationships. I worked retail part time while I was in college, but was frustrated that I might never see a satisfied customer again. As a wholesaler, I created lifelong friendships with retail customers, manufacturer/suppliers and fellow distributors. Helping friends and keeping up with changes in products and companies make this an exciting and personal business.

C.B.: What do you like least about flooring?

Jim: In the absence of knowledge, the consumer has only price to differentiate between products. I am very bothered by those people who commoditize products due to lack of product knowledge or interest. The reason manufacturers make different qualities are to meet the varying needs of consumers. It is a disservice to the consumer and the manufacturer to say the difference between a $4 wood floor and an $8 wood floor is $4. By ignoring subtle differences in product it cheapens our industry and its ability to make a fair profit margin for what we provide.

C.B.: What 5 opportunities do you see for the flooring industry?

• Better education and product knowledge of the people interfacing with the consumer as well as an appreciation for product differentiation.

• Improved product attributes regarding maintenance, installation, acoustics and performance.

• Better stewardship of the environment. Engineered wood instead of solid, recycling carpet fiber, establish networks of collection centers

• Commercial market for laminate

• Export from the US into emerging markets

C.B.: What do you see being the greatest advantage that the Floor Covering Institute offers?

Jim: With the combined expertise of the Floor Covering Institute's consultants, we offer a very broad source of knowledge, specific problem-solving abilities and unique insight on the global flooring industry. Many in our industry focus on a specific product segment and lose sight of the big picture. That’s where the Floor Covering Institute can truly help. We have the ability to bring the industry together, to address problems affecting all segments of the floor covering industry and share best practices from outside the industry. Bottom line: we can help industry participants become better informed, resulting in greater profitability.

C.B.: Is there anything else you’d like to add?

Jim: The floor covering industry is my home; the Floor Covering Institute was a dream and is now reality. My hope is that the Institute will help build my dream home.

Thank you, Jim.

Previous post in this series: Meet Carl Ruland

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