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Nortek To Realign Home- Tech Brands Into 3 Groups

5/24/2012 03:08:14 PM Eastern
Carlsbad, Calif. - The new Nortek group that consolidates the company's AVC Group brands with the previously independent SpeakerCraft/Proficient and Panamax/Furman brands will realign all nine brands into three business groups to reduce product and R&D duplication and deliver programs with higher impact, a group executive told TWICE.

Five years ago, all of the brands were expanding their product selections to become one-stop shops, but because the market has turned down, all brands "need to focus on the things they're really good at," said Elan's Paul Starkey, who will direct marketing for the as-yet unnamed group. "We started to perfect that with the AVC Group model, and now it will be more obvious."

The AVC group was formed in 2010 to consolidate the Nortek-owned Niles Audio, Elan Home Systems, Xantech, Aton and Sunfire brands under one roof. Now AVC will be consolidated with the Nortek-owned SpeakerCraft/ Proficient and Panamax/Furman brands.

With the latest consolidation, all of Nortek's residential-focused electronic brands will be under one roof.

Under that roof, Nortek will create three business segments: power and accessories, which consists of select products from Panamax, Furman and Xantech; control and electronics, which includes Elan, select Panamax products and Panamax's Blue Bolt brand; and audio, comprising the SpeakerCraft, Proficient, Sunfire and Niles brands.

For marketing, the business-segment directors of each group will report to Starkey, who will be responsible for executing marketing strategies and delivering products and programs to sales teams headed by Dave Keller. Reporting to the business-segment directors will be product and brand managers for the different brands.

For SpeakerCraft/Proficient, Proficient's Keith Marshall will remain in charge of developing marketing strategies, and Starkey will execute them.

The new reporting structure will eliminate the three brand president positions under which the AVC Group previously operated.

The rep companies used by SpeakerCraft/Proficient and Panamax/Furman will remain in place. "We don't anticipate short-term changes," said Starkey. Late last year, all of the AVC Group brands began sharing the same rep companies.

As for potential staff reductions arising from the consolidation, Starkey said "eliminating jobs is not the driving element" behind the restructuring, saying that all operating units are profitable. The main driver, he said, is to "spur more innovation," explaining that brands acquired by Nortek over the years duplicated efforts and were in a "maintenance mode of product development." Now the combined companies have "an opportunity to innovate and create a better value for dealers," he said.

As for layoffs, "we have not gotten to that level" of decision making, but he said there would be job-shifting and, in a couple of "key areas," new hires.

The headquarters of the unnamed group will shift to Petaluma, Calif, where Panamax/Furman has its headquarters. Bill Pollock, president of Panamax/Furman, has been named president of the new group.

The new group will also retain its presence in Carlsbad, where AVC Group was headquartered.

AVC Group president Mark Terry will leave the company. SpeakerCraft president Jeremy Burkhardt announced his retirement earlier this week.

 The group said no changes "are currently planned" for existing dealer contacts, customer service, tech support and credit operations.

 "We've joined the expertise and efficiency of the industry's most important technology brands and formed a new resource for our dealers that represents a unique opportunity for them to grow both ROI and competitive standing," said Sean Burke, group president of Nortek's technology products segment. "By synergizing the benefits of our brands under one centralized group, additional resources can be better allocated to product development and marketing."
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