Over the years I’ve been to my share of buying group meetings, but in all the years I’ve visited with NATM, MARTA, Key America (remember them?), Best Brands Plus, NECO, Nationwide, BrandSource, HES and HTSA, none were as eventful as this week’s doings at the Progressive Retailers Organization (PRO) Group meeting in Scottsdale, Ariz.
I decided to arrive at the PRO Group meeting when its members got in, Monday, May 7, the day before the official opening of its annual spring meeting. The next morning I had a non-PRO-related appointment in Scottsdale. As I was returning to the hotel my cellphone rang. It was our executive editor Greg Tarr on the phone telling me that PRO’s Harvey Electronics was going to acquire fellow member MyerEmco.
That venerable New York metro-area-based Harvey, which has seen its share of financial problems, was the entity doing the acquiring hit me sideways at first. Especially when you consider that privately-held MyerEmco is “profitable,” in the words of Gary Yacoubian, president/COO of MyerEmco who was named head of the newly combined Harvey after the acquisition becomes final.
So I made my way over to the PRO Group meeting room which was closed to the press, as are many confidential meetings at any buying group meeting. As they broke for lunch executive director Dave Workman and a few members confirmed the story. At least I was onsite, but can you imagine the surprise (if they weren’t informed ahead of time) when they landed in Phoenix to find out that two major players in the PRO Group were merging?
When I tracked down Yacoubian, to his credit he said, “We timed this. We didn’t want to have 19 separate one-on-one meetings scheduled with our suppliers” and then later announce a deal.
That evening during the PRO Group reception I caught up with Tweeter’s president/CEO Joe McGuire, who days before the meeting declined to have a sit-down interview in Scottsdale. Cordial as ever, when he saw me, McGuire said, “I’m sorry we couldn’t meet, but you know we are releasing our second-quarter report Thursday, so I can’t really say much until then.”
But when Tweeter released its second-quarter numbers and had a conference call with analysts and press, during questioning McGuire said that all of the chain’s suppliers have been made aware of its current situation. The manufacturers I spoke to during the PRO Group meeting never hinted that they knew that Tweeter was considering Chapter 11 reorganization. That’s admirable loyalty if they did know, but frustrating for this or any reporter.
So you have a merger of two members to open the PRO meeting and the possible Chapter 11 filing of the group’s largest member to end it. As far as the Harvey/MyerEmco deal, most were supportive and some wanted more details. Tweeter has the support of PRO and many of its suppliers. Further developments over the next few weeks and months will determine if one or both of these changes to some venerable CE retailers will be successful.
In between those announcements plenty of PRO members and suppliers shared their opinions about the state of CE retailing with TWICE. Watch for more about all that at TWICE.com in coming days and our May 21 print edition, which features the annual TWICE Consumer Electronics Top 100 Retail Report.