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How the High Profit Distributor Outfoxes the Competition

By Doug Adamson

Big-box retailers have made floor and wall tile a commodity. In times past, the presence of ceramic tile in your home was an indication that you spent a lot of money on its installation. But that's not necessarily true anymore. Today, ceramic tile can be sold to retail consumers for less than 99 cents per square foot. This puts ceramic floor tile well within the price range of most homeowners.

Also, floor covering distributors have had a lot do with lowering the margins of virtually all price classes of floor tile. The typical tile distributor has overhead expenses of nearly 30%, whereas many full-line flooring distributors have overhead as low as 15%. And even though the full-line distributors have taken full advantage of their lower-cost overhead infrastructure, the independent tile distributor has not lost any market share whatsoever. As a matter of fact, independent tile distributors still handle significantly more than half of all ceramic tile sold in the United States.

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