The headline in the local business press seemed ominous: Flooring Retailer Shuts 5 Stores, Lays Off 25.  News of this sort can be unsettling to retailers who run much smaller operations. If an eight-store flooring chain with nearly $20 million in sales is floundering, where does that leave the single-store mom and pop shop? Many specialty store retailers seeing news like this will undoubtedly take a hard look at their balance sheet. Is it time, they may ask, to cut prices, lay off staff and talk to the kids about the virtues of community college?

The headline in the local business press seemed ominous: Flooring Retailer Shuts 5 Stores, Lays Off 25.  News of this sort can be unsettling to retailers who run much smaller operations. If an eight-store flooring chain with nearly $20 million in sales is floundering, where does that leave the single-store mom and pop shop? Many specialty store retailers seeing news like this will undoubtedly take a hard look at their balance sheet. Is it time, they may ask, to cut prices, lay off staff and talk to the kids about the virtues of community college?



Of course it is unpleasant to see anyone committed to the flooring industry stumble. We are all well served by the powerful sense of fraternity in this business. If your competitor goes bust, you wonder: Did they collapse under the weight of bad business decisions, or was it something else that brought them down? If it is true that a rising tide lifts all boats, it’s equally true that a drought can render an entire landscape barren. And these days, many flooring retailers are feeling the heat.

In this case, the flooring retailer in distress should be seen as a cautionary tale. Amigo’s Flooring is the eight-store chain that is reportedly shutting five units and issuing pink slips to 25 workers. (Company officials did not return calls seeking comment.) The chain, which opened the first of its Los Angeles-area stores in 2001, embraced a business model that is completely at odds with the emotions and passions that drive flooring. They went with lowball pricing and huge stores that offer all the ambiance of a ship’s boiler room. They sidestepped distributors and tried to get everything direct from the manufacturer. Amigo’s plight should not make you uneasy unless you are using the same playbook. And if you are, it should make you very uneasy. 

Check out the chain’s web site (www.amigosflooring.com) and you begin to understand why we are now hearing that the company was forced to file for Chapter 11 bankruptcy protection. One of the first things you see is a statement from the retailer’s founder and CEO, Michael Cope, crowing about the oversized tin shed that was used to launch the chain. “Some people say it looks like a beat-up old metal barn, but to me it was beautiful,” he says like a proud dad gushing about his kid’s finger painting. Further down on the page he goes on about the company’s “no-frills warehouse style” and “lower operating costs.”

The section “About our products” is the real eye-opener. It begins with the promise of “Real hardwood flooring for the price of a Laminate” then teases shoppers by dangling the prospect of “Name Brand Laminate Flooring for less than a cup of coffee?” It promises 60 styles of hand distressed hardwood flooring  “that will make your home look expensive. At the lowest price in history!” Everything is price, price, price. 

You get the idea. No doubt when they launched, Amigo’s Flooring had in mind the many working-class families that are the backbone of Southern California. Perhaps, as the name might imply, they pointedly targeted the legions of folks in this area who are of Hispanic heritage. Overwhelmingly these are    proud, hardworking, people who struggle mightily to achieve the American dream. Having an amigo in the flooring business would not be such a bad idea when you are trying to achieve a beautiful home on a tight budget.

But whether you call them friends or amigos, people who truly care about you are not those who see things strictly in dollars and cents. They care more about your comfort, your happiness and, ultimately, your dreams. This is why the approach taken by Amigo’s Flooring turned out to be such a flop. When the residential market was on a roll, the demand for flooring was such that even retailers who treated our industry’s products like a commodity could stay afloat. Now, as the business has become a bit more challenging, they are the first to feel it. Why? Because customers were not drawn to them for their expertise or the expectation of a comfortable, relaxed shopping experience. They were  wooed by nothing more than the promise of flooring on the cheap.

For those in the flooring business, particularly those in Southern California, there should be no gloating over the plight of Amigo’s Flooring -just a sigh of relief that your operation sells on passion, not price.