ProSource, BrandSource's CE division made up of the Progressive Retailers
Organization (PRO Group) and Home Entertainment Source, held an SRO reception
on Thursday night during CEDIA Expo.
The group's leaders said
during the get-together that the definition of buying groups in the industry is
Jim Ristow, CE executive
VP of BrandSource, commented, "We are no longer a 'buying group'
traditionally. That definition needs to change drastically."
Workman, executive director of PRO Group, gave one example, saying his organization's
reaction to the new BrandSource app has been very upbeat.
is proof positive that what we have been doing to leverage the best of the both
groups," he said.
Workman noted, "Buying
groups have always been about programs, programs, programs ... and marketing.
The world has changed and we need to change, look to find new solutions
proactively. Logistics, business model changes, forecasting -- all that plus
advanced Internet tools, and make changes."
"You can't program
your way to survival anymore to get an extra 2 percent [of profit] for
survival," Workman stressed.
"Different steps abound, involving e-tail, retail or maybe some sort of
blend" should be involved.
Workman said that when it
comes to his PRO members and web operations, "No other buying group has
the core competency in Internet retailing than ours. We have several retailers
in our group that are experts."
When asked if ProSource
would develop an in-house brand strategy down the road, Workman responded,
"We had plenty of discussions about it with members, and we would like to
work with our [supplier] partners. We would like to work with leading suppliers
to come up with special derivative lines exclusive to us as opposed to our own
private-label lines. Most private labels are usually low-end promotional
Ristow noted that in TV
at least, these private-label products
are usually tier-three products, $20 to $30 lower in price. The risks are price
and if the market changes the risks for our members would be upside down
because ProSource members might be at risk for lower margins.
"At this point Vizio,
in TVs, are squeezed. How could we do better with a house brand of TV than
Vizio? Our group wants to work with our partners [on derivatives,]"
Workman said ProSource
wanted lower priced HDMI cables and worked with Monster Cable on an exclusive
line "that they built for us. Members want us to back well-known
As for the Expert
Warehouse II project, the CE operation has begun, according to Ristow, with
shipments to customers "coming soon ... that is the next step."
In terms of Pro Source's
relationships with suppliers, Workman said that some of its members want fewer,
but stronger partners.
"That is what the talk
is. We need more help from stronger partners is what they are saying," he
Ristow added that
ProSource's Signature program will be stronger than ever in 2012, and Workman followed
up that members do want a true, core partnership with key vendors.
In other areas Ristow
said a smartphone program via Expert Warehouse II has not been set as yet, but
he acknowledged, "It is a high volume, business-within-a-business."
Workman also addressed
the 20,000 gorilla in the TV business -- the rumored introduction of Apple TV possibly
"Apple TV will
change the user experience when it comes out. You must follow the breadcrumbs
when to comes to Apple."
Workman said Apple is working
with Game Stop, and wondered if Apple will they have a game function in their
TV's user interface?
"They will want the IPTV
experience to be seamless, and have an easy user experience. They probably
think that today's IPTV is clunky. They think they can come in and get a major
share of the market," he said.
As for Workman's PRO
Group, sales are around the $1.6 billion area annually now, with most members
doing better this year than last, except Sixth Avenue Electronics, which has
closed stores this year and had a myriad of problems. For the industry itself,
"The TV business is not great ... it is very challenging. We must adapt
and take advantage of other categories."
Sixth Avenue Electronics executives, members of the PRO Group,
were not seen at Thursday night's reception. When asked about the current state
of the chain Workman referred any questions to the chain's management.
<strong>CEDIA EXPO</strong> Indianapolis - ProSource, BrandSource's CE division made up of the Progressive Retailers Organization (PRO Group) and Home Entertainment Source, held an SRO reception on Thursday night during CEDIA Expo.