Australian flooring and blinds retailer Carpet Court recently celebrated its 50 year trading anniversary. The milestone follows a busy period for the company. The franchise recently undertook a refresh which included a new website, signage and branding, has expanded to over 200 retail stores nationwide, and is working on a book that records Carpet Court’s history. Carpet Court CEO James Hayward told Inside Retail that the 50 year milestone is a “remarkable” achievement, with its co-o
s co-op franchise model having proven key to its longevity and success.
He explained that Carpet Court offers a relaxed franchising model, with the brand’s leaders providing autonomy for its members to make key decisions.
“The members are shareholders, and as big shareholders they want everything to work in the best interest of the group,” he said.
“Other groups really hold their membership to just their group – and we’re more relaxed about that.
“We don’t tell our members what to do. For us, leadership means showing them the path, [and] it’s their call on whether they climb on board with that journey. The vast majority are really engaged and – should they wish to leave – we don’t block them, which is quite unique in this industry.”
Hayward added that the business model was, in some respects, more challenging earlier in its lifecycle.
For instance, he noted that customers wouldn’t place a deposit, and would pay once the carpet was installed. This would place additional stress on the stores – who would be tasked with recouping debt – if the customers couldn’t afford to pay following installation.
“We operate in a different way now to ensure we don’t have a debtors list that we have to worry about. We are also heavily focused on the customer to make sure their journey is exceptional,” Hayward said.
“That’s been one of the big evolutions that has happened over many years.
Middle Australia
According to Hayward, Carpet Court underwent a period of exceptional growth in FY21 and FY22.
He attributed this growth to the easing of lending restrictions, additional government support as well as a booming marketplace. The business went “gangbusters” amid Covid-19 restrictions in Victoria, with customers saving money and spending more on home improvements.
This included demand for flooring, carpets, rugs, windows and other upgrades that Carpet Court specialises in. He pointed out that Carpet Court experienced over 15 per cent growth during this period, and that the company is now in a stable position. There are expectations of about $338 million in retail turnover across the country this financial year.
He also noted that Carpet Court’s Qantas partnership – launched during Covid-19 restrictions – helped to accelerate growth, with customers more inclined to spend at Carpet Court due to the Frequent Flyer points on offer. It is also focused on aggressive marketing campaigns – including the rebranding – which is particularly focused on its core audience; the middle Australian marketplace.
The brand’s new tagline – dream it, style it, live it – is part of this campaign, with the company seeking to engage with its customers during the “dream it” stage.
However, Hayward noted challenges; including supply chain restrictions during Covid-19, a lack of qualified installers across the country – a critical part of the brand’s customer engagement – and current cost of living pressures.
“Something we’ve been focused on is bringing new apprentices into the business over this last period,” he said.
“We had that 15 plus per cent growth period, but we’re now settling back to pre-2020 levels, which was still fantastic.
“For the last 18 months to two years, we’ve been talking about what to do when we come out of that [growth] cycle, and what we need to go after.”
Not set and forget
Hayward noted that the company had been working to operationalise its strategic plan which was signed off by the board in 2017.
The company had spent much of the last few years mapping out and emphasising its customer experience, and worked to educate store owners on its customer base – which typically shops once every ten years.
He added that Carpet Court lays flooring and other services to about 110,000 houses a year, and has recently enhanced its in-house technology to streamline its services. This includes transitioning to a more digital payment process and utilising customer data to analyse trends, examine different markets and enhance its offering.
Hayward added that the Qantas partnership has recently been extended for another three years, with the board now working to develop a new strategic plan for the next three to five years.
“It’s not set and forget, we don’t do that. We chased our tails a little bit over Covid-19 to secure stock, as we were running out like everyone else. Now our focus will be on how we can engage with our customers better through technology to continue to drive our share,” he said.
“The launch of our updated website is all about engaging with customers in a different way, and there are more features to come which we look forward to launching in the market very shortly.”
Hayward added that the stores – which are locally owned and operated – regularly engage with the local community, with customers often dealing directly with the store owner. He recently observed three generations working together in one shop – which he believes is part of the appeal.
“The older man was in his late 70s and tinkering around one day a week. The boys who run it now are in their mid-40s, and then their children are coming through the business,” he said.
“It’s a really cool story, and there’s a lot to come in this space.”