A Group Changing Of The Guard
By Steve Smith -- TWICE, 2/13/2006
During the two-week gap between the NFL Conference Championship games and the recently completed Super Bowl one of the many bits of trivia discussed was the fact that the Pittsburgh Steelers have had only two head coaches since 1969: Chuck Noll, who won four Super Bowls and left in 1991, and Bill Cowher, who replaced him and won this year's big game. Of course, the football pundits praised Pittsburgh's ownership for its patience and consistency when it comes to its head coaches.
Up until early January the same qualities could have been said for several of this industry's leading buying groups. During the 1990s, either by retirement or the deaths of their leaders, Brand Source (formerly AVB), MARTA, Nationwide, NATM and the Progressive Retailers Organization (PRO) Group all passed the torch to a new generation of buying group executives. (Home Theater Specialists of America was formed a decade ago and is still under the direction of founding executive director Richard Glikes.)
So it was surprising to hear right before International CES about Warren Mann leaving MARTA, where he spent seven years as executive director. His departure occurred at the same time MARTA's board decided to form a strategic alliance with Brand Source. Replacing Mann was Dave Workman, ex-president/CEO of Ultimate Electronics who had been on the job as president of extended warranty company Warrantech for a month.
It was just as surprising to hear about Roger Heuberger's departure from the PRO Group earlier this month. Then a couple of days later Workman bowed out of his job at MARTA, fueling speculation that he might join his old buying group PRO, where he was a member while with Ultimate.
Mann is now working on a new organization called the World Merchants Buying Group. Aside from the conjecture about what experienced and well-respected industry executives like Heuberger and Workman will do in the future, what does all this say about the condition of the industry's buying groups?
By all accounts, business for group members has been good during the past decade, with the housing boom fueling the major appliance business and HDTV sales leading the way in CE. Suppliers over the past few years kept on saying that they need the independent retailers to sell and explain the new, more complex digital products in CE and upscale major appliances, and still do.
But if market conditions have shown us anything in this decade, it is that the electronics/appliance industry is changing faster than ever. In CE, more manufacturers are relying on distributors to service independent retailers, similar to moves made in the late 1980s and early 1990s. And in major appliances, not only has there been consolidation but more suppliers have turned to national chains to pick up additional market share.
Buying group meeting season is upon us and is always informative. This year it will be more intriguing as buying groups themselves will be the story, probably discussing with members and suppliers what their ongoing roles are in the future.
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