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Best Brands Planning To Pump Up CE

With new technology whetting shoppers' interest in home theater and big-screen TV, the Best Brands Plus (BBP) buying group is encouraging its members to give consumer electronics a second look.

Although many of BBP's 360 members de-emphasized electronics or dropped the category completely when margins nose-dived a few years ago, the group's management believes the influx of new technology offers opportunities for the independent retailer. At BBP's annual meeting in Orlando recently, members heard plans for a store-within-a-store concept to bring them back into the consumer electronics market.

Retailers attending the meeting also heard feedback on the group's "banner store" program, through which stores are remodeled to present a unified BBP brand image. About 70 of BBP's 1,000-plus storefronts are participating in the National Banner program so far, said Jerry Honea, merchandise manager for BBP's furniture division.

Last year was a good one for five-year-old Best Brands Plus, according to executive director Pat Reed. He said the group as a whole showed "good, solid sales growth" of 13%-14% in 1999, bringing its total volume to the $1.3 billion to $1.4 billion range. Of those total sales, about 75% of BBP's volume came in furniture, with major appliances generating about 20% and consumer electronics the remaining 5%.

Reed said the fourth quarter of last year was very strong across the board for the group, although bad weather in many of its markets softened January sales. As for the first half of 2000, "I don't see anything that gives concern," he told TWICE. "Our business remains good."

To help boost business this year, BBP has just signed an agreement with Maytag to use the manufacturer's Ol' Lonely character in the group's advertising.

The group has also made a commitment to new technology via its website, which now offers services such as central billing and centralized order collection for manufacturers. "We want to show suppliers that independent retailers can be as economical to deal with as the big chains, using the Internet," Reed stated.

As for e-commerce direct to consumers, "that will be of little consequence to us, because we sell categories of merchandise that people want to touch and feel before they buy," he said. "We see the Internet as more a source of information and reference." The group's website includes consumer information about products, store locators and links to major manufacturers.

While acknowledging that "the electronics category has been a struggle for independent dealers," Reed thinks BBP's new focus on what he calls "performance products" should help electronics sales going forward. "This is an area where our type of dealer can provide a value-added service," he explained. "These products require demonstration and presentation as a component of selling, and our members are good at that."

Best Brands Plus is currently developing a prototype electronics store, to be constructed using 1,000 square feet of floor space inside an existing store or as a 3,500-square-foot freestanding unit. The group will offer members a turnkey package including recommendations for merchandise to be stocked. The focus is on home theater, according to Rick Bellows, BBP's merchandise manager for appliances and electronics.

"There's a lot of new product in electronics right now, and a lot of excitement," Bellows said. "This is a window of opportunity to get back into the electronics business if a dealer has exited it, or to expand the business for those still in it."

Bellows said the group is targeting the "home-theater-in-a-box customer, addressing the price range of the mass consumer." BBP will provide further details on the concept at five regional meetings in May, and by September, Bellows hopes to have a prototype store up and running. "We want to approach the electronics market as a whole new industry," he noted. "We're coming back in with open eyes and a fresh look."

During the meeting, attendees also heard reports on the success of the group's National Banner program, through which BBP members revamp their stores, doing everything from changing exterior signage and repainting trucks with the Best Brands Plus logo to completely remodeling interiors and redoing merchandise presentation.