Despite the soft economy — and in some ways because of it — H.H. Gregg is continuing to grow its store count at an aggressive clip.
The Midwest major appliance and CE chain plans to add 11 new units during the course of its current fiscal year ending March 2002, bringing the total to 46. The build out continues an expansion strategy that saw 14 units added during the past two years, effectively doubling the dealer's store count from 18 locations in 1999.
The current construction plans call for two new stores in Dayton, Ohio, eight within the Cleveland, Akron and Canton area, and one in the Indianapolis suburb of Avon. Of those, one Dayton store is already up and running, while the Avon unit was scheduled to open last week.
All will be consistent with the company's average 30,000-square-foot footprint.
To support the expansion, the company, which operates in Indiana, Kentucky, Ohio and Tennessee, will also open a 60,000-square-foot distribution facility in Cleveland to house big-screen TVs and major appliances that are earmarked for home delivery.
The regional powerhouse is expanding dramatically during an economic downturn that has other dealers holding on for dear life. So why the counterintuitive tactic? According to chief operating officer and executive VP Dennis May, the soft economy — and attendant retail rout — has left a wealth of real estate and trained retail workers in its wake.
"The company is taking advantage of opportunities in the real estate market," May explained. "The soft market also frees up quality people."
Indeed, a number of the Cleveland area locations are former HomePlace and Office Depot stores that are being leased and retrofitted to fit the H.H. Gregg format. The company already occupies former Ohio sites of Roberds and Sun TV & Appliance, where May previously served as president.
May noted that the expansion is being funded by the retailer's "own internal operations. We're very well-financed, so there aren't any issues there." The privately held business, which is a member of the NATM buying group, enjoyed CE sales of $271 million and majap sales of $169 million last year, placing it 49th in electronics and eighth in white goods on TWICE's Top 100 retail rankings.
In other news, the company is adding an e-tail function to its Web site at www.hhgregg.com. The site, which had been informational only, was scheduled to begin selling a limited selection of major appliances last week, and will add CE to the assortment within 30 days.
May said that Gregg's e-commerce reach would be "focused within our markets."