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Features

Creating A Total Floor Covering Resource

Producing soft- and hard-surface products enables Mohawk to meet a broad variety of floor covering demands.

TW Special Report

T hroughout its history, Mohawk has routinely reinvented itself to adapt to changing business conditions and challenges. In the 1970s and ’80s, carpet was the floor covering of choice for style and luxury. In the ’90s, this began changing, with hard-surface products like tile, hardwood and, later, laminate gaining more and more market share. Because of changing consumer tastes, Mohawk made the decision to become more than just a carpet resource and began actively developing other product lines. These included two major acquisitions: Dal-Tile for ceramic and Unilin for laminate. In addition, Mohawk developed partnerships with a number of hardwood suppliers to expand its wood line, and became a national distributor for Congoleum® resilient. As a result, Mohawk’s overall product mix changed dramatically. In 2001, 5 percent of company sales were hard-surface products; in 2005, 35 percent of sales were hard surface.

mohawk3mroom

Mohawk has established strong partnerships with other suppliers including St. Paul, Minn.-based 3M, which provides Scotchgard™ finishes for Mohawk hardwood flooring products.

Mohawk Carpet: Commercial And Home

Carpet is still the core of Mohawk’s business, and the company has a strong presence in residential carpet, commercial carpet, and rugs and accessories. Mohawk’s residential brands include Aladdin®, Horizon®, Wunda Weve®, Custom Weave® and Karastan®, which provide consumers with a vast selection of products at virtually any price and quality level. Mohawk has created three aligned dealer networks —Mohawk Floorscapes®, Mohawk ColorCenter® and Mohawk Floorz® — that provide cobranding opportunities between Mohawk and key independent retailers nationwide. This has not only strengthened Mohawk’s relationships with many of the nation’s best flooring dealers, but also has produced better retail selling systems that have improved store profitability and the consumer buying experience (See “A Step Forward For Retailing,” www.TextileWorld.com , July/August 2006).

On the commercial side of the business, Mohawk’s brands include Bigelow Commercial®, Durkan Commercial®, Karastan Contract®, Mohawk Commercial® and Lees®. These businesses provide Mohawk with the capability to service the overall commercial market and also allow the company to target brands to specific industry subsets, such as hospitality, medical and modular flooring.

Mohawk Home, the company’s multifaceted rug and textile business based in Sugar Valley, Ga., provides rugs, throws and other home décor merchandise including bath rugs, matelassé bedspreads and throw pillows to mass merchants and specialty retailers across the nation. Mohawk products are marketed under Mohawk Home®, Mohawk Select®, Goodwin Weavers®, Karastan and numerous private brands. Designers and artists who have contributed to Mohawk’s line include Raymond Waites, Thomas Kinkade and Susan Sargent.

For a number of years, Mohawk has been producing its own carpet fiber — establishing facilities and brands for nylon, polyester and olefin products; and currently supplying a significant percentage of its fiber needs internally. In addition, Mohawk has maintained strong partnerships with other fiber and fiber treatment suppliers such as Invista (Stainmaster®), Solutia (Wear-Dated®) and 3M (Scotchgard™). In 2005, Mohawk announced it had teamed with DuPont to become the exclusive supplier to the carpet industry of SmartStrand™ fiber made with DuPont™ Sorona® polymer. Considered according to industry consensus to be the biggest innovation in fiber in 20 years, as reported by industry publications, SmartStrand fiber offers exceptional stain resistance and cleanability, durability, and styling options. Mohawk reports the SmartStrand launch has been the biggest new product introduction in its history.

“The SmartStrand launch was significant in that it was the first really new fiber for carpet in more than two decades,” said Ed Williams, senior vice president of marketing. “It has the resilience of nylon coupled with remarkable stain resistance and a very soft hand. Stain resistance is engineered into the fiber, so it will never wear off. It has Mohawk’s first-ever Limited Lifetime Warranty for stain resistance. It also allowed Mohawk to partner with DuPont for the power of two key brands that consumers strongly associate with floor covering innovation.”

Williams noted the SmartStrand launch to customers across North America included demonstration kits, displays and video presentations that could be incorporated into store displays. Some retailers were so enthusiastic about the product that they went so far as to remodel their stores so the SmartStrand display was the first thing consumers saw as they entered the store.

Beginning in 2007, SmartStrand will have a unique sustainability story, as DuPont begins making Sorona polymer, in part, from sugar-based crops such as corn (See “Sustainability Yields Quality,” www.TextileWorld.com, July/August 2006).

Dal-Tile: Ceramic & Stone

In 2002, Mohawk became the leading provider of ceramic tile in the United States with its acquisition of Dallas-based Dal-Tile Corp. Dal-Tile has annual sales of $1.7 billion and is the largest resource in the United States by a significant margin for ceramic tile. The Daltile® and American Olean™ brands are well-recognized among dealers, builders and consumers; and Dal-Tile offers the most comprehensive product line in the industry.

Dal-Tile added to the largest ceramic tile production capacity in North America recently with the opening of new facilities in Oklahoma and Mexico, increasing its production volume by 14 percent. Market share is increasing in the residential market, and profitability is benefiting from an emphasis on higher-margin products.

More than half of Dal-Tile’s sales service centers have been remodeled, and the number of sales personnel has been increased. In six major US markets, Dal-Tile has established gallery selection centers that showcase its entire product portfolio. This gives the division the opportunity to show just how many design options are available with its product line. And like Mohawk, Dal-Tile has grown through carefully planned acquisitions that increased its presence in stone surfaces.

Mohawk also markets a separate line of ceramic products under its Mohawk Ceramic brand, which has allowed more penetration into floor covering retail markets.

mohawktile

Mohawk's acquisition of Dal-Tile Corp. in 2002 added ceramic tile to its portfolio of products.

Unilin: Laminate Flooring

In 2005, Mohawk completed an acquisition that gave it a major presence in the fast-growing laminate market. Patterned after the Dal-Tile acquisition, the purchase of Unilin NV, a Belgium-based company, was designed to fast-forward Mohawk’s development of a key product category.

“As we did through the acquisition of Dal-Tile in early 2002, we have further diversified our product base, distribution strategy and geographical footprint through the acquisition of Unilin,” said Jeff Lorberbaum, chairman and CEO, Mohawk. “We were impressed by Unilin’s operating team and the strength of the Quick-Step® brand strategy, as well as the company’s attractive growth prospects going forward.”

Unilin is the only vertically integrated laminate manufacturer in North America, and has just opened a new plant in Thomasville, N.C., with the capacity to produce 100 million square feet per year. In addition, Unilin and its brand, Quick-Step, are recognized as major innovators in the laminate market, creating dramatic new flooring styles that mimic natural stone and wood, complete with texture, grain, beveled edges, random patterns and even hand-scraped looks. Unilin’s glueless plank locking system, Uniclic®, allows easy angled assembly of the floor or — in tight spaces such as under counters — a sliding method of securely bonding the boards by tapping them together with a mallet.

The US market for laminate flooring is expected to grow at 15 percent annually, and Unilin/Quick-Step is positioned to take a significant part of that share. In addition, Mohawk markets a separate line of laminate products under its Mohawk Laminate brand, providing the opportunity for even more market penetration.


Creating The
Optimum Distribution Resource
 

As North America’s largest flooring company, Mohawk requires an efficient and comprehensive distribution infrastructure.

Mohawk’s national distribution network is comparable to a small national freight company. Mohawk operates 21 factory warehouses, 19 regional warehouses and 43 satellite warehouses across the nation. A fleet of 1,000 trucks and 2,000 trailers services more than 30,000 customers across the continent.

carpetplant

More Than Half Next Day

This highly flexible operation is capable of delivering carpet, tile, hardwood, laminate, vinyl, rugs and other products anywhere in the nation. More than half of Mohawk’s expansive product inventory is available to customers typically within a day’s time.

“Fast availability of our products is essential, not only to compete in our industry, but to be competitive with other categories of consumer goods,” said Ed Williams, senior vice president of marketing. “Consumers have a myriad of choices for using their income, and they’re used to rapid response and fulfillment. Our dealers need the ability to get the merchandise promptly and schedule installation. The customer isn’t used to waiting.”

Inventory Control

Mohawk’s inventory is tracked at every step of production and delivery using the company’s exclusive Real Time Visibility software.

With Real Time Visibility, dealers can get up-to-the-moment reports on orders throughout the system, which uses satellite signals, transmission towers and wireless mobile computers to continuously monitor deliveries from Mohawk. The system lets Mohawk and its customers know when orders load onto the truck, where the truck is located, when each order delivers, what was delivered and who signed for it. Dealers can pinpoint within a matter of minutes when their orders will be arriving at the loading dock.

Mohawk also is a strong believer in backwards integration and has executed a number of acquisitions to help manage manufacturing for carpet, ceramic tile, laminate and other products. This helps improve efficiency even further and manage costs.

Hardwood, Vinyl And Other Lines

Mohawk also distributes a full range of hardwood flooring products in a wide variety of specifications and finishes. Mohawk’s hardwood flooring line has been singled out by key industry publications for its quality, styling and value. Dealers themselves have voted Mohawk hardwood products as being their choice of all new offerings for the year.

Mohawk also is a distributor of Congoleum vinyl products, which offer versatility, durability, and an exceptionally wide selection of colors and styles.

Other Mohawk product lines, like Mohawk Home rugs and throws, are marketed through mass merchants, discounters and department stores, adding an entirely new level of distribution activity. Because of the size of these customers, Mohawk distribution also utilizes new technologies such as radio frequency identification to manage inventory and shipments.

July/August 2006




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