Issue Date: 2019 NOVEMBER, Posted On: 11/24/2019

11252019 Retail Insights: Margie O'Krent Talks Rugs at O'Krent Abbey Flooring Center in San Antonio
By RugNews.com Editors

Margie O'Krent, CFO, and husband Sam O'Krent, president, at their namesake flooring center, which sells programmed and custom rugs as well as broadloom and hard surface flooring. 

SAN ANTONIO -- O'Krent's Abbey Flooring Center in San Antonio has been selling rugs for more than 100 years, and today offers a vast assortment of rugs from leading suppliers at its three-story, 34,000 square foot building - the largest retail floor covering showroom in Texas. 
Indeed, while some specialty flooring dealers have abandoned rugs or de-emphasized them amid growing threats from online merchants, O'Krent Abbey Flooring remains committed to the category as a full-service flooring retailer.  

The three-story, 34,000 square foot O'Krent's Flooring Center building is the largest retail floor covering showroom in Texas. 

But the family-owned legacy business now led by Sam O'Krent -- named for his great-grandfather and company founder Samuel O'Krent -- has retooled its rug focus to adapt to market changes. Thus, the company's new emphasis is on cut and sew custom rugs from name brands -- some known more for their broadloom; others for programmed area rugs offered with custom options. 

Margie O'Krent, who serves as vice-president and chief financial officer for the company (she is a CPA by training),  and also supervises human resources, IT, purchasing and advertising, took time out of her busy schedule to discuss the rug business during what is clearly a transformative time for brick-and-mortar dealers. 

Has your approach to selling area rugs changed in the last 2-3 years with the growth of online? 
MO: Selling rugs has changed although I don't know if our approach has changed. We're paying attention to what's happening online. We have a large store in terms of square footage, and rugs take up an enormous amount of room.  

I have said in the past that 'To sell rugs, you have to show rugs', but I don't necessarily think that is true anymore. These days you can find rugs on Houzz, on Instagram, and other places. How people find rugs is all changing. People used to really need to touch a rug and feel it. Today many websites are so great to where you can use the zoom in feature and see the different colors, angles and dimensions of the rug. You know what it is made of. It is almost like you can touch and feel it [through the screen]. 


Are you seeing more interest in rugs with the growth of hard surfaces? Are your RSAs instructed to discuss rugs when selling hard surfaces
MO: The growth of hard surfaces has been going on several years, but we are not seeing a correlation in those [combo] sales. I don't know if - after a $20,000 to $30,000 job - that the customer wants to buy a rug right then and there. We do have a dedicated rug person here and sometimes they will work with that client after a hard surface purchase to pick out a rug.  

Where we are seeing an uptick is in broadloom; we are doing a lot of broadloom rugs in contrast to the programmed rugs. We are getting a lot of those customers.

Pairing sales of hard surface flooring with and area rugs seems like a natural, but has been more difficult than expected, Margie O'Krent said. 

What/how is the best, most effective, way to merchandise and sell rugs? 
MO: You have to have a lot of space. For example, some of the rug boutique displays from our vendors are great but if someone is going to come into the store to buy a rug, they want to see the full rug. The sales staff doesn't gravitate toward the [boutique] displays [because] the customer wants to see the rug. I can see putting a kiosk in the showroom where you sit down with the customer and they can see the true color and design of the product.  

Can you share any other strategies for merchandising

MO:We like to highlight a few rugs on individual racks (away from our rug racks). We also rotate our inventory regularly by changing the location on our racks. This creates refreshed new looks for your showroom without having to invest in new inventory.
Our clients are primarily conservative in decorating, but we bring in a mix of contemporary and transitional designs as well to make the assortment more exciting. We also rack turns, and replace rugs that are not moving in addition to bringing in new designs.
A good strategy for better space utilization is to supplement your in-stock area rugs by layering rug rack arms with color blankets and coordinating runners on top of the area rug.  
We also find that computer generated tags are preferable to hand-written tags (psychologically it adds more validity to the pricing).   

You need to be sure and set a pricing strategy.  Area rugs are an item that is typically thought of as a "sale" item by consumers.  Therefore, your regular price must be high enough to allow you to discount regularly.  

How are rugs faring today, and what is your outlook for the near term? 
MO: Rugs are down slightly but that does not take into account the broadloom sales [that are converted into rugs and sold that way]. Selling rugs the old-fashioned way will be challenging as it is getting tougher to compete even though many of our vendors protect us from online internet sales.  

The area rug business has certainly become more difficult over the last handful of years with the explosion of online retailers in the market.  In order to deal with this consumer change, we have in turn focused increased efforts on custom rugs made from broadloom carpet in order to maintain margin and retain our hard surface customer's rug business.

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