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The collision between the 12-volt aftermarket and the performance accessories business was a key issue at the Mobile Electronics Retailers Association (MERA) Knowledgefest 2002 this month.
Now that car and truck accessories have become a $14 billion business, with sport compact accessories skyrocketing 300 percent in the past three years, and truck accessories soaring 60 percent in the same period, MERA is actively encouraging all its members to enter the segment.
MERA said it altered its mission statement to embrace performance accessories, expanding its focus from an association of 12-volt industry members to one of "professionals who market products and services that enhance the driving experience," explained executive director Rick Mathies. In the future, car stereo shops will become car performance shops, he explained. "Accessories is the same audience as our target 18- to 24-year-old male. The kids are going to spend the money to buy it, so it should be at a [car stereo] specialist."
Mark Miller, owner of Westminster Speed & Sound, Westminster, Pa., and a member of the MERA board of trustees, strongly warned retailers. "We feel the lines between the typical car stereo retailer and performance accessory retailer will blur in the next five years. So be forwarned," he said. "If you don't think the people selling performance accessories aren't going to come after your lunch, they will," he told a seminar audience.
On the plus side, Miller said, retailers can double their profits by entering the car and truck accessories market, and this entry typically requires only about 64 square feet of retail space. It also helps leverage your investment in your installers, he added.
"Performance accessories will expand the productivity of your installers. They can make more money for you," Miller said. "I'm in a market with 17,000 people and my lead tech makes $50,000 to $55,000 a year with benefits. Getting into this category gives me an opportunity to pay him more, and instead of charging $60 an hour for the average car audio installation, performance accessories average $75 an hour," he said.
MERA board of trustee member Joe Cavanaugh of Stereo West, Omaha, Neb., told MERA members that, four years after entering the segment, it now represents 10 percent of his total business and he expects it to reach 40 percent to 50 percent. From November 2001 through January 2002, he said, his sales in the segment grew 100 percent with lighting, exhaust systems and clear corners being particularly strong.
This TWICE webinar, hosted by senior editor Alan Wolf, will take a look at what may be the hottest CE products at retail that will be sold during the all-important fourth quarter. Top technologies, market strategies and industry trends will be discussed with industry analysts and executives.