Yoder Floors’ roadmap to success

Columbus, Ohio—In a land of Goliaths, there is still room for a David. Sheldon Yoder is living proof.

This city is home to two of the largest independent retailers in the country in Rite Rug and America’s Floor Source. Combined, the two behemoths do more than three-quarters of a billion dollars in sales annually. There is also former NFA member Levis4Floors, some Carpet Ones and, of course, your friendly neighborhood big boxes: 10 Home Depots, four Lowe’s and a couple Floor & Decors.

But while Yoder is not looking to slay any giants, he has carved out a very comfortable business in the shadows of these huge players. His story is not only an illustration of the American Dream, but his success can serve as a blueprint for just about any floor covering retailer.

Yoder, along with his wife, Julie, bought a flooring business called Budget Carpet and Flooring back in 2012. The model was simple: Buy truckloads, stack rolls on the floor, customer points to the roll he or she wants. The average customer was at the lower end of the spectrum.

Yoder did not have a background in flooring. He was in the post-frame construction world from high school until 12 years ago. “I worked my way up from labor to general manager of the company,” he said. “But [my wife and I] wanted to own a business. We looked at multiple options and Budget Carpet was available. I figured I know construction; it’s just a piece of construction. This should be an easy transition. That was only partly true.”

Budget Carpet was a $700,000 business. Profitability was not great. “We took a huge gamble,” he said. “We actually borrowed 100% of what we needed just to get started.”

Takeaway #1: If you believe in yourself, you may need to do whatever it takes to get in the game.

The Yoders were renting the building from the previous owner. Two and a half years after purchasing the business, a developer bought the building to build condos, so they needed to relocate. “This building [two miles down the road] was for sale,” Yoder said. “It needed a lot of work, so I used my background in general contracting to renovate it.”

Takeaway #2: It is always better to own than rent.

With the renovation, the Yoders had a vision to change the business model. “We realized this was too unprofessional,” Yoder said. “It needed to be cleaned up. So over time we started changing how we do things. Probably the biggest change was we got a much nicer, cleaner showroom. About the same time we got the Costco account, which is a higher-end customer who demands more excellence, more craftsmanship and service. So it forced us to get more professional.” It also paved the way for Budget Carpet to get into hardwood.

Takeaway #3: Always recognize the need to evolve.

It was around this time that the Yoders forged a strong partnership with Shaw. “Back then we pretty much split our business between Shaw and Beaulieu before they went out of business,” he said. “Shaw actually brought us to Costco. But the more we’re in business, the more we see Shaw does things differently. They have a long-term relationship in mind, and they have better customer service. They take care of you better, especially with claims, they give you incredible value on products, they give you support on business issues. So over time our business became about 85% Shaw.”

Some years ago Yoder became a Shaw Flooring Network dealer, something in which he finds incredible value. “We get a resource outside of product, whether it’s marketing, financing through Wells Fargo or knowing other dealers who you can call and ask advice. It’s also given me more confidence to make decisions.”

Yoder said he’s called dealers on everything from marketing to RFMS software challenges to setting up and managing a commercial division to after-sale strategies. “There’s been a lot of learning on the marketing side because we just didn’t know,” he said. “You learn if you market you have to measure. You can’t just market and not measure.”

Takeaway #4: Many successful retailers believe you must align with one supplier to maximize the benefits of the relationship.

Three years after purchasing the business and implementing some changes, the Budget Carpet had grown from $700,000 to $1.2 million. Remarkably, this was done with no advertising. “We are a firm believer if you do what you say you will do and you do it well, you’ll get business,” Yoder said. “Up until recently we never advertised. We didn’t have the money. It has all been word of mouth, repeat, referral; give great customer service, give good value, do an amazing job, and people tell all their friends to come here. It was literally all organic growth.”

Between the organic growth and Costco business, the Yoders saw their business hit the $3 million mark by the end of 2018. A year later COVID-19 hit. “We didn’t have to shut down because we were deemed essential,” he said. “Sales tanked for a period of time, but in the summer business came roaring back and 2021 and 2022 were just insane.” The business saw 50% growth over those two years to reach $4.5 million.

The last two years have obviously been harder, but Yoder has held the line. How? In a word, diversification. “This year residential replacement is down, but Main Street commercial is growing well. You also get builder relationships and that leads to repeat customers. We’ve had to work harder in the last year and a half than we had in the past. And we’ve run more sales. We also dabbled with some advertising for the first time ever.”

Takeaway #5: Retailers must find ways to diversify their business to withstand slowdowns in retail.

Growing a business sixfold in 12 years doesn’t happen by accident. Yoder attributes that to a few things but admits they do things differently than others. “First, you have to hire high-character people,” he said. “None of the people we have working for us came from flooring—not that flooring people are bad. They have to have the same view of the world as you do. If you have great people, you can accomplish great things. The second thing is our hard surface installers are employees, not subcontractors. We get a level of craftsmanship and service that nobody can match in Columbus.”

Everyone in business knows how hard it is to find good people, especially in today’s world. But Yoder had an advantage. “We grew up in a pretty tight-knit Mennonite community,” he said. “Most of our people come from there and we’ve known our whole life. We knew their character. So for the average retailer who doesn’t have that tight history of knowing people, it would be much harder to do what we’ve done.”

Yoder’s philosophy takes a page from the Southwest Airlines playbook: Founder Herb Kelleher always said, “We hire for attitude and we train for skill.” Yoder noted, “Our people don’t have flooring backgrounds, but they have skills, values and high character.”

Takeaway #6: When it comes to hiring, a person’s character is more important than his or her resume.

Aside from hiring people without flooring backgrounds, Yoder deviates from the norm by employing his installers, something smaller retailers rarely do these days. “Because I was a construction worker I was a W-2,” he said. “I get in this [flooring] world and start working with independent installers. It was a mess. They would come and go; they wouldn’t show up and there was no ability to control schedules. And you couldn’t be efficient because it’s a three-man crew and on day three, let’s say you need one guy to finish the job. Well, now all three guys go there and they’re done at 10 a.m.”

He found a completely different experience when he started hiring his own installers. He now has five full-timers. “You can move your own guys around as much as you need. We’re much more efficient. We have a three-man crew, but one guy finishes and those other two go on to the next job. They’re incentivized; there are bonuses. Yes, it’s more expensive. That’s why we’re not the cheapest in town. But we’re usually in the ballpark. A lot of my competitors say, ‘You can’t afford that. That’s expensive.’ My response: ‘You spend money on Google Ads and that money just disappears on the web. I spend money on my crews that get me referrals.’”

Takeaway #7: Hiring employees on the installation side may be more expensive than using subcontractors, but the benefits can outweigh the cost.

In an effort to take the next growth step, Yoder recently made one of the most important decisions a business can ever make: A complete rebrand. After 12-plus years, the name Budget Carpet is no more. It just didn’t reflect the business any longer and, in fact, was becoming an impediment.

“We’ve never liked the name ‘Budget Carpet,’” he said. “But if you change your name and nobody knows who you are, you’re really tying your hands. But as we got into the Costco world, getting into the higher-end stuff, we said, ‘Budget’s not really who we are.’ But we just didn’t know how to rebrand. We didn’t know what that would do. We were growing. Why would you change if you’re growing this fast?”

But a couple years ago Yoder realized the Budget name was beginning to be an issue based on solicited customer feedback. “The overwhelming response was, ‘Your name’s a problem. I only used you because I trust my neighbor or friend. I never would’ve called you if I had not been referred to you.’ That was the last straw. We also had a couple high-end custom builders say, ‘Yeah, we’ve used you occasionally. You guys do great work, but I can’t send my customers into Budget Carpet to pick out products.’”

Takeaway #8: Your brand must align with your values and what you offer.

Yoder embarked on the rebranding journey last fall and was connected with White Label Studio, the digital marketing agency specializing in the home industry founded by Mollie Surratt. “We tried to simplify who we are and get that defined before we picked our name,” Yoder recalled. “We wanted to make sure our values were reflected in the name. White Label came up with the name Yoder & Co. Floors. Family values are a big deal to us and the Yoder name in this area means Amish, it means integrity, it means craftsmanship. So it was a good way to mesh that. And the logo looks retro but modern.”

Early feedback has been overwhelmingly positive from designers and builders: “We’ve heard, ‘This is a game changer. You should have done this a long time ago.’ So we have high expectations.”

White Label is going to help with the marketing. They will run all social platforms for Yoder: Facebook, Instagram, Pinterest and LinkedIn. “We are using a mixture of paid and organic tactics that show off products and installations but also communicate the heart and values of Yoder & Co. Floors,” Surratt said. Yoder added: “Our values are what makes us different. Having family pictures and things like that on our website and social are at the core of who we are.”

Takeaway #9: Hire a professional for the most important undertakings.

Twelve years after purchasing a $700,000 business, life is different for the Yoders, both professionally and personally. “Back then, I was literally doing everything,” he said. “I was the warehouse guy, sold every job, scheduled everything, hauling carpet in a van. It was just whatever you have to do to make it work. We’re obviously not doing that now. Learning how to be a CEO has been a journey.”

At the same time, the Yoders are enjoying their lives much more. “We travel more. I picked up some hobbies, do a lot of bike riding, golf. Definitely less stress, definitely more flexibility and ability to do things.”

What else have they learned that they can impart to other retailers?

“You have to find your values and make those values work in this industry,” he said. “If you’re successful owning a small business, that should be what you do, not who you are. We own a flooring store, but it’s not my identity. And when you get big enough and can afford to pay a great staff, it’s crazy to work 60 hours a week and be stressed when you can pay somebody to manage things.”

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