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Nationwide Launches Sourcing, Service, Marketing Initiatives

2/14/2007 10:39:00 AM Eastern

Orlando, Fla. — Nationwide Marketing Group, the $11 billion buying organization for independent majap, CE and furniture dealers, announced a series of sourcing, repair and in-store marketing initiatives at its biannual PrimeTime! convention here this week that were developed to give its 2,800 members a competitive edge in the marketplace.

The sourcing component is comprised of the group’s first buying office in China, which opened recently in Shenzhen, and the hiring of two agents based there and in the United States. The effort was initiated by Nationwide’s Furniture Smart home furnishings division, but will also provide new sourcing and shipping opportunities for the group’s brown- and white-goods businesses, said president/director Ed Kelly.

“We want to take cost out of the supply chain,” Kelly told TWICE. “We’re looking for good companies to partner with, new resources, and see opportunities to lower freight costs by bringing in container loads directly.” Nationwide, through distributor and logistics partner DSI, maintains warehouses in California and North Carolina that can receive the direct-sourced goods.

The group has already sourced its first product directly from China, a home entertainment furniture lift unit, and is negotiating a sourcing contract on a home theater seating product that is expected to begin shipping in late spring. Kelly said Nationwide also has the capability to develop private-label programs for CE and majaps products, but is still weighing the benefits of a group house brand.

On the servicing front, Nationwide said it will launch an expanded service and repair program this spring, which will leverage the group’s more than 1,000 servicing members and its buying power on parts. The effort, the group said, is designed to increase the profitability of independent service providers by helping them maximize warranty reimbursement rates and increase extended warranty sales.

“The service industry is a tricky business,” said Nationwide executive VP Robert Weisner. “It’s difficult to get suppliers to offer flat-rate discounts to independent service dealers. Factors like location, reputation and size always seem to get in the way.”

The group plans to include targeted member service programs in the initiative, including a new fleet program for purchasing service trucks, customized business insurance plans to reduce dealer liability, and is contracting with the Hiring Connection to screen job candidates.

Weisner said the program will be offered to members at no additional cost since its goal is to increase dealer profitability. “Yes, we may incur costs, but at this point we feel it would be counterproductive to hit our members with additional fees,” he said.

Nationwide plans to host a “service summit” in late spring where group members and senior service department executives from the leading CE and majap manufacturers “can explore new strategies within the self-service industry” and address dealers’ diminishing profitability, the group said.

Nationwide’s third initiative, dubbed MediaDirect, provides proprietary high-definition content for dealers to run on their HDTV displays. The digital signage includes generic, event-based and personalized commercials produced by Nationwide’s PrimeMedia studio in Atlanta, plus movie trailers, vendor showcases, demonstration materials and event graphics. The programming is transmitted in 720p and 1,080i via Nationwide’s MemberNet Intranet Web site, and is delivered to in-store video servers that dealers can buy or lease.

A pilot version of MediaDirect was first introduced last summer, said executive VP Les Kirk, and a full-scale launch was timed to this week’s show. He said the program frees members from displaying cable or satellite programming, which often includes ads by big-box competitors or product promotions that can divert customers’ attention on the sales floor.

Kirk added that PrimeMedia will increase the size of its production facilities by 50 percent this spring, and will more than double the size of its learning center to 60 seats to keep up with demand for Nationwide’s workshops and seminars.

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