Ken Crane's Closing
By Alan Wolf -- TWICE, 6/18/2010
Hawthorne, Calif. - Ken Crane's, a fixture in Southern California TV retailing, is liquidating all merchandise and will shut its doors within 60 days.The privately held business found itself "powerfully affected by the nation's unusually severe and continuing economic downturn," the Crane family said in a statement, and "a steep, relentless decline in same-store sales activity led to the difficult decision."
The 62-year-old business shut four of its 10 stores in January as part of a restructuring that also saw the departure of senior VP/COO Steve Caldero.
"This is unquestionably the most painful business decision our family has ever had to make," said president Casey Crane. "We have been a home for employees, a place of trust for our customers and vendors, and a source of pride and leadership among our competitors for many decades. As painful as this is, we plan to end this as fairly as we can for all concerned."
The chain, founded in 1948 by Casey's father Ken as a Magnavox-exclusive dealer, was a high-service specialty A/V retailer renowned for being a West Coast showcase for new products and technologies, including Panasonic's 103-inch plasma display, which it presented exclusively in California in 2007.
The company posted its best year ever in 2006, growing by more than 40 percent. But by April of 2008, after being battered by the ailing Southern California housing market and weak local economy, Ken Crane's implemented an aggressive workforce reduction, making across-the-board cuts in overhead to maintain its viability.
"In the past, we have been able to weather these kinds of economic storms because people tend to stay home more, tap into their home equity, upgrade their home entertainment systems, and wait for conditions to improve," Crane said. "Unfortunately, the combination of home foreclosures, tight lending policies and high unemployment combined to create the biggest recession in our company's history."
Ken Crane's is the second Progressive Retailers Organization (PRO Group) dealer to close its doors this season, following Flanner's Home Entertainment into liquidation.
"We may not be the first consumer electronics retailer to close in Southern California, but I sure hope we are the last," Crane said.
Talkback
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The CE business is doomed. Nobody anywhere can compete very long with Walmart on price so this company is just another in a long line that are/have/will be heading to the CE graveyard.
Consumers have also spoken loud and clear that they could care less about customer service which only leads more people to Walmart and Target. They may gripe if something breaks when they discover that it will take two weeks to get a tech out. Or they may even find that nobody is around to work on it.....ever. But to save $6.45 they'll roll the dice on that. And manufacturers certainly don't care about customer service either so this side of the business is already toast.
All in all it is a shame as CE used to be a great business. I'm sure we'll read about it as the years go by and as it disintegrates into pieces.....probably to resold at Walmart for a few nickels per piece right near the shampoo or Pokemon cards.
Sarah Connor - 2010-19-6 08:21:32 EDT -
Yet another quality retailer, full of good people trying to do the right thing for their customers, unable to survive with a high touch model in an time of low-margin sales.
It's pretty obvious we're in an era where customers just don't see value beyond "what's the lowest price I can get this for anywhere in the world."
Here at TechExpert Express! we're seeing similar effects in our corner of the business - providing quality on-site service for the product lines and warranty companies that still DO care about their customer's experience. Believe it or not, they're still out there.
BUT....forced by their own margin pressures and need to show black ink on the bottom line, they're also lowering repair reimbursements and going to "lowest bidder" approaches to providing service.
Do I fault any of them in this? No, they're in a cut-throat competition to stay in business just like all of the rest of us, and doing what they have to do.
Is this good for customers in the end? Probably not, but as with any situation where the long term effect of a decision are not directly and immediately connected TO that decision, it's hard to see. The majority of customers will always choose to save a buck right now rather than think about what might happen in the future - if or when they need some form of support from their retailer or servicer...
Do I fault them for that? Of course not, it's just human nature.
Where do we go from here?
Todd Maddison - 2010-18-6 10:37:19 EDT -
Another fine company with great people punished by unsatisfactory margins on video. I wonder what the video vendors margins will look like when two companies tell them how much the want to pay for goods.
Richard Glikes - 2010-18-6 10:34:55 EDT
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