By Lisa Johnston
New products on display at the American International Toy Fair, held in N
1600 Harbour Bay Parkway, Alameda, Calif. 94502
Ken Weller, chairman/CEO
Annual Sales (fiscal 2002): $750 million
Number of Stores: 71
Product Mix: Consumer electronics
Alameda, Calif.— Good Guys, the venerable West Coast CE specialty chain which celebrated its 30th anniversary last month, did something in fiscal year 2002 it hadn't done in seven years — recorded a profit. In fact, Good Guys posted a $1.1 million profit on sales of $750 million during the fiscal year. Not bad for a company some had thought was going down the slippery slope of many CE chains that have gone out of business.
Still, Good Guys recorded a loss of $8.4 million for its fiscal first quarter ended May 31. But chairman/CEO Ken Weller told TWICE recently that the chain has cut costs, closed under-performing stores and most importantly, re-merchandised its locations to take advantage of the ongoing demand for upscale digital video and audio products. (See TWICE, July 21, p. 18.)
Weller said that unlike national chains that he calls "low-cost providers" that "are beginning to look more similar," Good Guys is in position to take advantage of the demand for upscale CE products due to "our product mix, better in-store experience, and a shift in merchandising." He noted that those are some of the reasons why he believes the chain is in "the sweet spot in the consumer electronics business."
Along with having better partnerships with vendors that are on the cutting edge of the digital wave, Weller believes there will "always be a niche for a chain that leads the way in new product introductions, in-depth product demonstrations and the like."
He also stresses that the new, streamlined Good Guys now sports "a cost structure that delivers real savings and profits." Weller is optimistic about the future, adding that if the economy over "the next 12 months [is] better than the last 12 months" — especially in sluggish Northern California where some of the chain's larger stores are located — Good Guys is positioned for consistent profitability.
This TWICE webinar, hosted by senior editor Alan Wolf, will take a look at what may be the hottest CE products at retail that will be sold during the all-important fourth quarter. Top technologies, market strategies and industry trends will be discussed with industry analysts and executives.