CarMax Automotive Showroom and Sales Offices Case Study

Client: CarMax –
Location: Headquarters | Richmond, VA
20-25 new builds and remodels annually, nationwide
Project Type: Automotive Showroom and Sales Offices
Area Supplied: Retail sales floor, Customer waiting areas, Restrooms and sales offices
Products: Floor Gres Chromtech Italian through body, unglazed porcelain tile, matte and polished 24″x24″ and 12″x12″ sizes
Mapei floor preparation, large format tile thin set mortar and grout with a 25-year warranty

CarMax is the nation’s largest retailer of used cars and operates more than 175 stores in 39 states nationwide. CarMax has built their brand upon offering a different sort of car buying experience with transparency throughout the car-buying process, a large selection of used vehicles, and a convenient and easy place to sell a vehicle. CarMax has more than 24,000 employees nationwide and for 13 consecutive years has been named as one of the FORTUNE 100 Best Companies to Work For. During the 12 months ended February 28, 2017, the company retailed 671,294 used cars and sold 391,686 wholesale vehicles at its in-store auctions.

Challenge | Stock-outs, long lead times, inconsistent pricing
When Creative Materials contacted the CarMax design team, they had chosen and specified a neutral through-body tile with technical characteristics suitable for commercial applications for all CarMax locations. Although the tile offered a great aesthetic and worked well in the showrooms, it was chosen without a distribution plan to go with it. Each project was quoted and ordered through regional distributors, pricing was not fixed, and stock was not inventoried in the USA. The result was stock-outs from local distributors, high pricing, long lead times, and frequent air freight shipments to finish up projects.

Solution | Consolidated national tile supply program
Creative Materials became aware of the issues that CarMax was facing and completed a pricing and program assessment. CarMax was paying too much for tile that was either taking way too long to get to the site, or couldn’t be procured at all by required deadlines.  Creative Materials stepped in to take control of the program and determined that CarMax was happy with their tile selection, but simply couldn’t tolerate the long delays and regional stock-out issues. CarMax assumed that the root of the issue was the tile being procured overseas.

Creative Materials assured CarMax that by implementing a consolidated tile supply program, stock-outs and delays would never be an issue, no matter where the tile was manufactured. Creative Materials procured the exact same product from Italy that CarMax liked. The inventory was imported and stocked in the USA based on CarMax’s development and remodel schedule. Creative Materials utilized its buying power with the manufacturer to implement low, fixed, national account pricing to ensure all projects would stay under budget.

CarMax no longer experiences stock-outs and receives these additional benefits:

  • A 25-year warranty due to setting materials being included the program
  • Consolidated jobsite deliveries of all tile and setting materials
  • Dedicated account management
  • Average tile costs of $3.14/SF vs. $7.00/SF

CarMax projects receive tile in one week or less at fixed prices. The CarMax management team receives monthly reports showing tile supplied and inventory levels from to ensure ongoing program success.

Download Carmax Case Study

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