Starnet recently completed the mandatory State of the Group Survey. This annual shareholder survey produces a financial benchmarking report for Starnet members to guide adoption of best practices for objective improvements. Along with the internal benchmarking metrics, members can explore the comparison charts by region and size of business to see how their company stacks up against their peers.

The findings from the State of the Group survey have been vital to the cooperative program's development. They provide targeted areas for vendor support and uncovered objective measurements for business improvement that may not be available to flooring contractors outside of the cooperative.

Some statistics from our membership include 77% of the companies have been in business more than 25 years and 35% of the membership celebrated an amazing 50 years in the marketplace! According to U.S. Small Business Administration SBA statistics published including 2022, only 16% of US businesses have survived past 25 years. Starnet members are companies their associates and supporting vendor partners can build careers around. These statistics also demonstrate the commitment to excellence the Membership Committee is resolved to maintain as they consider companies for membership. Before they are admitted to Starnet, prospective members must already be significant commercial flooring contractors, have a history of ethical business practices in competition for work, and have the support of key Starnet Preferred Vendor companies. Not every company is a good fit for Starnet, and very large financially significant companies have joined other organizations after being declined membership by their first choice - Starnet.

The Formula

Overall, commercial flooring contracting firms that have remained successful for over 25 years have a common framework that can be cited as examples for creating the conditions for best-in-class longevity:

• Strong mission and shared vision
• Education and communication is a priority
• Strong corporate governance and community connection
• Develop generations of leaders
• Diversified business approach

Strong mission and shared vision

These firms have communicated their core values and mission consistently to employees, customers, and suppliers. They may have also established a set of guiding principles that informed their decision-making and strategic planning. These firms have maintained a strong founder's mentality, focusing on a core set of values and a clear sense of purpose. Company unity around these ideas is the cornerstone of a lasting enterprise because it allows for smart decision-making at the action-level of the business. The entire company can move in the same direction in support of the same goals.

Education and communication is a priority

Most members are heavily invested in employee training and development. These successful firms recognized the importance of having a skilled and knowledgeable workforce in every position. They have provided ongoing training and development opportunities for their employees, helping them stay up to date with industry trends and best practices. They have also created a defendable strategy by differentiating themselves from competitors and setting the regional standard for a value-added market. To create a business that succeeds from generation to generation, the next generation must be excited about it. Long term interest and a sense of accountability is built on shared information and form the rationale for added resources and investments. Successful multigenerational businesses develop their identity and culture as learning organizations, ensuring that each associate acquires the critical skills necessary to be good stewards of the enterprise.

Strong corporate governance and community connection

They have also maintained a strong focus on financial discipline and cost management, ensuring that they remain profitable, reinvest in their business, and participate in the community as a strong corporate citizen. Successful firms have a strong focus on financial discipline, carefully managing their costs and reinvesting profits back into the business. They have also established clear financial goals and metrics to track their progress over time. They run their companies by the numbers every day, focused on productivity. Many member companies hold regular meetings during which leaders propose policies on financial matters and efficiency gains and align on what the owners want for enterprise performance. These meetings will include guiding principles, employee goal setting, risk management, capital allocation, corporate development, and charitable causes.

Develop generations of leaders

These firms have invested in building strong relationships with their customers, suppliers, and employees. The best organizations identify roles for key employees or family members that capitalize on their passions and strengths, aligning their interests with those of the business. They establish a process to evaluate the next generation of ownership or leadership using an assessment that measures qualifications, skill sets and interests. Some family members may even work outside the family business to gain experience in other roles. They often have established processes for everyone who wants to participate and earn a leadership position in the enterprise.

Diversified business approach

These successful Starnet member firms have invested in research and development to create new products or services that meet the evolving needs of their customers. They encourage employees to share new ideas and take calculated risks to expand the enterprise. Most have identified unique value propositions that set them apart from their competitors. They have focused on providing exceptional customer service, offering a wider range of products or services, and developed innovative installation techniques. They have fostered a culture of innovation and continuous improvement, constantly seeking new ways to meet the needs of their customers and stay ahead of industry trends.

Durable enterprises forged by the crucible of time

By modeling the frameworks outlined above, commercial flooring contracting companies can be confident in the formula for business success and longevity. These common attributes occur repeatedly throughout the Starnet member companies. So many of our members have remained successful for more than 25 years. These frameworks create the conditions for best-in-class longevity, solid career building for all stakeholders, and Partnering For Success!