Wednesday, June 3, 2026 from Floor Covering Weekly

Growth opportunities & a steep learning curve
By Sharyn Bernard

For residential flooring dealers searching for stability in a soft market, commercial business can look like an attractive opportunity. Larger projects, recurring work and diversified revenue streams all hold appeal. Yet commercial flooring operates under an entirely different set of rules, and dealers who underestimate the complexity of the segment risk costly mistakes.

From bidding and specifications to labor management and elongated payment cycles, commercial flooring demands a fundamentally different operational approach than residential retail. Dealers considering the move must determine whether they have the infrastructure, expertise and financial discipline needed to compete successfully in the segment.

“To be successful, residential companies have to understand that the commercial business is very different,” said Geoff Gordon, executive director, Fuse Alliance. “By going after commercial work, a retailer can better stabilize their business — when residential is soft, the commercial sector is generally strong and vice versa. They are also broadening their customer base by adding GCs, architects, designers and end users.”

Indeed, “coming from residential flooring to commercial can feel like a different world with different decision-makers, longer sales cycles, more technical requirements and a greater need for alignment across specifications and service,” said Mark Bischoff, president and CEO, Starnet Commercial Flooring. “We have members across North America with strong residential businesses that have expanded their footprint on both sides of the business. In many cases, we work side-by-side with their commercial teams, but the insights, strategies and best practices they gain often go back and strengthen the entire organization.”

As well, the lessons learned at residential retail can translate to commercial, Bischoff said. “Commercial work is also moving away from being transaction-focused and becoming far more relationship-driven. In many ways, it mirrors the best parts of residential — the people who succeed are the ones solving real problems.”

Jumping In

For residential dealers, identifying a need and developing a strategy to approach the commercial market is the just the first part of the process. “There are many steps involved in building a commercial business,” said Fuse’s Gordon. “First, define your business model. Do you want to focus on healthcare, education, corporate, multifamily? Will your labor be in-house or subcontracted? Union or non-union?”

There are many other factors to consider, Gordon added, from building supplier relationships to finding the work to understanding the different work and payment cycles.

“Expanding into commercial requires a different state of readiness, and we’re intentional about helping dealers build toward that,” said Jeff West, vice president, marketing and design, Shaw Contract. This includes helping dealers understand the full scope of commercial products, supporting dealers in building relationships and project execution.

Given the size and relative health of the commercial market, there are opportunities for dealers entering this segment. But they need to be discovered and managed differently. For one thing, commercial work often requires certifications and licenses. “In most markets, certifications are not legally required but they are becoming increasingly important,” Gordon said. “Some states do require our members to hold a state contractor’s license. We do have manufacturers who require that we get our installers certified on their products.”

As for finding the work and projects, there are many avenues dealers can take. Bischoff said it’s key to understand who leads the specifications in each market. “This means strengthening operational capabilities, and what it takes to create credibility with architects, designers, general contractors and end users. Managing documents and the legal and operational risks associated with those obligations is a primary difference between residential and commercial work. Residential contractors that have robust standard operating procedures to support scaled builder work are better prepared to enter commercial than their business to consumer peers.”

Brian Preuss, president of AHSG/Commercial USA, said residential dealers should look at their current relationships, too. “Your existing residential builder relationships — they have commercial divisions you may not know about.” In addition, he suggested connecting with local business groups, school boards, property management firms, A&D companies and other companies that require commercial work.

Relationships Count

Dealers should lean into their vendor relationships to develop their commercial business. “In the commercial floor covering segment, relationships are the most fundamental currency,” said Dave Capalbo, vice president of retail sales, Karndean Designflooring. “Because commercial flooring is a high-stakes, multiphase investment, strong partnerships — built on trust — ensure reliable product sourcing, project timeline adherence and long-term financial stability for everyone involved.”

Indeed, brands that have both residential and commercial lines have already laid the foundation for these partnerships. “The vendor–contractor relationship is fundamental in commercial flooring because success in this segment depends on far more than supplying product,” said Chris King, senior vice president, residential, AHF Products. “Commercial jobs are larger, more complex and carry significantly higher risk than residential work, so contractors rely heavily on vendors who can provide stability, expertise and continuity throughout the entire project lifecycle. Vendors like AHF and our partners bring established relationships with commercial specifiers, architects and contractors, helping retailers navigate the longer, more technical commercial sales cycle. For retailers, this partnership is key. It allows them to confidently take on Main Street projects and then parlay that experience into larger, more complex commercial opportunities.”

Vendor relationships carry into all parties, noted Shaw Contract’s West. “Success often depends on aligning multiple stakeholders around a shared vision and maintaining that alignment over time. Whether it’s the architect, contractor or dealer, each partner plays a critical role in ensuring a specification holds and the project delivers as intended.”

Commercial groups are inherently designed to build and foster relationships to build the business. “Groups like Fuse allow contractors to work together to solve problems and improve member businesses by sharing best practices,” Gordon said. “Fuse also helps members strengthen their supplier relationships by giving them access to the upper management of our key vendors.”

At Starnet, “We help dealers understand how to access the right channels, how to position themselves more effectively in the commercial marketplace and how to learn from others who have already made the move,” Bischoff said. “Instead of trying to build a commercial strategy from scratch, members can tap into practical guidance, shared experience and a network designed to help them grow with more confidence.”

In fact, joining a commercial group may the best pathway for residential dealers to break into the business. “This is the entire reason Commercial USA exists,” said Joe Weber, CEO and COO. “A residential dealer trying to break into commercial alone has a five-to-seven-year learning curve. Joining an established commercial alliance compresses that to one to two years.”

Cautionary Tales

There are, of course, numerous pitfalls and problems that can arise in creating and building commercial business, and dealers need to understand the nuances and challenges in the commercial sector.

“Commercial and residential flooring operate very differently,” said Anthony Bayne, senior director, commercial sales, Mohawk Group. “Commercial projects typically involve longer payment cycles, tighter margins, retainage and more contractual risk. One of the most common pitfalls for residential dealers entering commercial is understanding the complexity of project management, labor coordination, compliance requirements and contract terms.”

Indeed, the entire cycle is different. “One of the biggest adjustments is how much longer the sales cycle is on the commercial side and how that impacts cash flow,” said Erin West, senior director, strategic partnerships, Mannington Commercial. “In residential, the timeline from quote to installation to payment is relatively quick. In commercial, projects can take months or even more than a year from specification to final payment.” And there are usually additional material purchases, phased delivering, extended payment terms and more complex billing. “Residential business owners need to be prepared to manage material costs, labor costs, inventory costs and operational costs while waiting for a project to close out.”

While some tenets of residential apply to commercial, it’s important to know what works and what doesn’t. “Commercial isn’t residential at scale — it’s a different business with different math, a different rhythm and different relationships,” Weber said. “But the basics still apply — take care of your installer, your supplier and your customer. Our job is to help members get from ‘we want to do commercial’ to ‘we’re good at commercial’ as fast as humanly possible.”

Residential dealers need to honestly evaluate the entire business and each job. “One of the most common pitfalls for residential dealers entering commercial is underestimating the complexity of project management, labor coordination, compliance requirements and contract terms,” Bayne cautioned. “Cash flow is often the biggest challenge.

Contractors frequently carry the cost of labor and materials for extended periods before payment, which can strain organizations that are not prepared.”

But, Bayne stressed, with care and diligence, it can pay off “Dealers that transition successfully start with smaller, light-commercial product to build experience, process and financial discipline before pursuing larger opportunities.”

As Bischoff advised, “For residential dealers looking to make the jump, the first step is not trying to know everything, it is making sure you are connected to the right people and the right resources. Commercial can absolutely become a meaningful growth opportunity, but it happens faster and more effectively when you have a partner in the process.”

“Residential is a transactional vendor relationship — you sell what’s on the floor. Commercial is a multiyear partnership.”
— Brian Preuss, AHSG/Commercial USA

“Success depends on far more than just selling a product. It depends on execution, trust and long-term partnership.”
— Erin West, Mannington Commercial

“Successful retailers recognize commercial as a separate business discipline and start by hiring someone with commercial experience.”
— Geoff Gordon, Fuse Alliance

“The relationship between manufacturers and dealers in the commercial segment is fundamentally different from retail. Commercial business is driven mostly on a project-by-project basis, with each opportunity bringing unique specifications, timelines and end-user requirements.”
— Anthony Bayne, Mohawk Group

“In commercial, relationships extend well beyond a single transaction — they are what hold a project together.”
— Jeff West, Shaw Contract

“Commercial dealer/vendor relationships in the flooring industry focus on business-to-business transactions. In contrast, traditional retail focuses on direct-to-consumer sales.”
— Dave Capalbo, Karndean Designflooring

“Just as a residential professional helps solve a homeowner’s challenge, commercial contractors and dealers who understand how to solve the business owner’s problems are the ones gaining traction and growing faster.”
— Mark Bischoff, Starnet Commercial Flooring

“Commercial relationships also depend heavily on our connections and credibility with architects, designers and commercial contractors. AHF brings decades of experience working with specifiers, which helps retailers navigate the longer, more complex commercial sales cycle.”
— Chris King, AHF Products