One – on – One…with Ed Metcalf
 
September 2nd, 2007

“Growing Along with the Tile Industry”

By Jeffrey Steele

September-October 2007

For years, Ed Metcalf has been widely regarded as one of the tile industry’s preeminent experts on installation products. And it’s no wonder.

Ed started his education in the business almost 30 years ago, establishing a rep agency while still a college student in San Diego, Calif. He spent the subsequent years honing his expertise, then in 1985 joined Bethany, Conn.-based Laticrete International, first as an independent sales rep, next as region sales manager, then with Laticrete’s Marketing, Technical Services and Product Development departments.

He has since been elevated to president, North America Division, for Laticrete, the leading privately-held, American-owned company in the industry.

Ed recently granted TileDealer a lengthy interview, and in this engaging talk shares his thoughts on Laticrete’s established and new products, the home building slump, the green building movement — and the challenge of lowering a golf handicap.

TileDealer: Tell us a little about your life and career, and how you reached the presidency of Laticrete?

Metcalf: I was born and raised in Pasadena, Calif., and attended San Diego State University. I started Tile Industry Sales while in college in 1979, representing a line of hand tools, and helped get that company into the ceramic tile business.

The tile industry in San Diego and southern Calif. was — and is — full of really good and talented people, and I found a niche to serve. It was a blast, and the relationships that developed with the contractors and distributors who were my customers made me want to stay in it forever.

When I got the offer to join Laticrete as a region sales manager, I was ready to make a move in my career, even if it meant leaving California to go “back east.”

Because my wife is from Connecticut, we felt it would work from a family perspective. I sold the agency in 1992, and joined the team at Laticrete headquarters in Bethany, Conn. in January 1993. Later in 1993, the national sales manager left the company, and at that point I was promoted into that role.

From the end of 1993 on, I have been responsible for the North America sales operation at Laticrete. I learned a lot, and the owners trusted me with more and more responsibility. In addition to sales, I went into marketing, technical service and then product development. I was appointed president, North America Division, in 2005.

I love working in this growing industry now more than ever, and love the people who help make it such a fun and challenging business in which to work.

TileDealer: Take us through the major categories of Laticrete’s products.

Metcalf: We’re unique in the industry in that our sole focus is on installation products for ceramic tile and stone. That’s been a defining characteristic of Laticrete since its inception in 1956. We focus on mid- to high-end products that add lots of value for distributors, contractors and end users. Our best-selling product today is SpectraLock Pro Grout, launched in 2002, which went from zero to our number one product in about 18 months. The main benefits of SpectraLock are ANSI 118.3 compliance, color consistency, high stain resistance and extreme ease of use.

The waterproofing and anti-fracture category is a big one for us. Forty years ago, the company innovated with the first thin, bondable, waterproofing membrane. That product, Laticrete 9235, fast became the number one product in its category, and still is today. In addition, we just introduced Laticrete HydroBan, a membrane that requires no fabric, bonds to a huge range of substrates, and can be flood tested within 24 hours. That’s a time frame that anyone can live with. It’s a big advantage over all the other competitors in the category.

The third product category in which we’re very active is premium multipurpose thin-sets. This is a very fast-growing category overall, driven mostly by the increasing size and density of the ceramic and porcelain tiles on the market today. The larger format introduces a whole set of new challenges for installation.

More and more, the market is demanding higher bond strength, slip and slump resistance, and the ability to “build” to compensate for uneven substrates.

The fastest growing products we offer in this category are Laticrete 255 Multi-Max, and Laticrete 254 Platinum Multipurpose. These have each been out for about three years, and they both are growing so far this year at about 80 percent plus.

TileDealer: Looking at today’s economic environment, has the housing slump impacted your firm?

Metcalf: Along with everyone else in the industry, Laticrete has been affected by the steep drop in new housing construction. But unlike some of our competitors, this was a very small part of our business compared with commercial and residential remodeling.

We’re actually having a very strong year in our “distribution” business as well as the “home center” side, and we are up overall in the strong double digits.

We’ve brought out a lot of new products that have been big hits, and which have added new sales for us and for our distributors. With expanding distribution nationwide, we feel that we and our distributors are very well positioned for the eventual recovery of the new home building market.

TileDealer: How do the distribution and home center sides of the business differ?

Metcalf: We’ve learned a lot about the home center channel in our 10 years working with Lowes. Most fundamentally, the key differences are in the product range and product packaging that is offered.

We have clearly differentiated both for nearly all of our products offered through each channel, and are sensitive to the struggles that floor covering and tile dealers have in competing with giants such as The Home Depot and Lowes.

Still, we’ve found that strong dealers can always compete based on service and product offering, and will always have a firm position in the minds of the American consumer. We feel the future is bright for distributors who specialize and who focus on adding value for their customers.

The distributors who will do well in this business going forward will do so by offering the best product and the most specialized service, because in the end that’s what the most desirable contractors and end users demand and value.

TileDealer: Are home improvements proving to be a positive for Laticrete?

Metcalf: Any time new housing slows down, remodeling and renovation gain momentum. Since we tend to do better in these types of projects where quality is more highly valued by the end user, this is a positive development for Laticrete and our distributors.

TileDealer: What types of improvement projects tend to benefit Laticrete the most?

Metcalf: The most common home improvement projects are focused on the kitchen and bath, but we’re seeing more and more tile installed throughout homes these days.

That’s one reason we entered the floor-warming market with Laticrete FloorHeat. Consumers view floor warming as an affordable luxury, and it can be added at not much additional expense. FloorHeat is an energy-efficient mesh-mounted floor warming system that’s thermostatically controlled.

We’re the first company in our industry to offer this type of product, in combination with all the other materials you need to get the project completed. The product just launched this spring, and the results have exceeded our expectations.

TileDealer: A big trend these days is green building. How do Laticrete’s products fit with that trend?

Metcalf: Laticrete was the first in our category to address this mega-trend by securing GreenGuard certification for all of our specification-grade products.

Green building is finally achieving critical mass nationwide. And we project that a larger and larger percentage of commercial and residential projects will incorporate LEED standards in some fashion each year. GreenGuard is independent certification that our products comply under LEED guidelines.

TileDealer: Is the green building trend a lasting phenomenon, or a passing fad?

Metcalf: This is undoubtedly a mega-trend. More responsible building practices are becoming economically, as well as morally, desirable. For government and large corporate projects especially, it’s become a political imperative.

TileDealer: What are the biggest challenges Laticrete faces short term? Long term?

Metcalf: Short term, our biggest issues are managing high growth rates and our major capital expansion program.

We’ve added a lot of capacity at all plants, and are nearly finished converting all plants to our state-of-the-art recyclable plastic packaging, replacing paper bags. So far, we’ve done very well through the transitions and have been able to maintain high service levels.

Long-term issues include finding enough qualified people to staff all the new positions we need to fill, as well as dealing with the consequences of continuing increases in raw material, commodity and fuel prices.

TileDealer: What does Laticrete do best? What are the company’s strengths?

Metcalf: For 50 years our strengths have included strong innovation in products, and excellence in marketing. We believe that this combination has actually accelerated the growth in consumption of ceramic tile and stone in the U.S. over the past few decades.

We’ve always focused on promoting tile first, and then counting on getting our share of the related installation product sales that follow.

TileDealer: What’s ahead for Laticrete?

Metcalf: As the guy ultimately responsible for sales, I can tell you that in the immediate future we’ll be working hard to soak up all the new capacity being installed in our eight plants nationwide! Also, our R&D department has been massively expanded and we are working on some really interesting product and application innovations for 2008 and beyond. In general we’ll continue to maintain our position as the leading privately-held, American-owned company in our industry.

TileDealer: What’s ahead for you personally?

Metcalf: I have three daughters who all have to get through college, so I’m not planning on retiring anytime soon. My immediate personal goal is to get my golf handicap under 12, to stay healthy, and to demonstrate gratitude for all the blessings that have come my way.

Source:

Ed Metcalf

President, North America Division

Laticrete International

Bethany, CT

203-641-0592

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