Combined Sales Fell In ’09 For Top 25 Car Electronics Dealers

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NEW YORK — Car electronics sales among the top 25 car electronics retailers fell in 2009 for the first time since TWICE began compiling its Top 25 list in 2003.

Combined sales among the group fell 10.6 percent to $5.12 billion, and only eight retailers on the list posted gains, TWICE found. Doubledigit percentage declines were the norm, with declines running as much as 53.4 percent for Buy.com.

As a group, however, the top 25 dealers handily outperformed the industry, based on the Consumer Electronics Association’s (CEA) 2009 estimates of a 42.6 percent decline in factory-level car electronics sales to $3.53 billion. The decline was driven mostly by a 58 percent drop in portable navigation device (PND) sales to $1.56 billion.

CEA’s statistics and TWICE’s Top 25 dealer sales statistics include sales of installed aftermarket car audio, car video and navigation systems as well as PNDs, car security systems and radar detectors. TWICE’s statistics were developed by The Stevenson Company.

Stevenson’s research found that the mass-merchant, consumer-direct, and 12-volt specialty channels posted slight dollar-share gains among the Top 25 retailers, while electronics and electronics/ appliance dealers reduced their share to 39.8 percent from 2008’s 42.2 percent, due in part to the demise of Circuit City. The electronic chain’s 2008 sales were $684 million.

Stevenson also found that the warehouse club and home-office channels also lost share among the Top 25 dealers, though not significantly.

Mass-merchant share rose to 24.7 percent of Top 25 volume from 23 percent, while consumer-direct share rose to 16.7 percent from 15.8 percent. The share of Top 25 volume held by 12- volt specialists rose a tad to 3.9 percent from 3.6 percent.

Some names fell off the 2009 list — Sam’s Club, Comp-U-Plus and defunct Circuit City — while two other names came to the fore — Kmart and Cabela’s sporting goods. Kmart floated to the surface as the 25th largest car electronics retailer despite sales volume that fell 24.3 percent to $21 million. Cabela’s sales were up 7.6 percent to $31 million.

For the year, one thing didn’t change. Best Buy, Walmart and RadioShack maintained their respective positions as the nation’s first-, second- and thirdlargest retailers of car electronics. All three, nonetheless, posted double-digit percentage sales declines. Best Buy’s $1.21 billion in sales handily bested No. 2 Walmart, which posted $799 million in sales.

Amazon.com moved up in rank to fourth from fifth place on the basis of a 14.3 percent gain in sales to $449 million as it, marketers said, has grown increasingly aggressive in car electronics. Target moved up to fifth place from seventh based on a 19.2 percent sales boost to $324 million.

The other six retailers that posted 2009 sales gains were the Army and Air Force Exchange Service, up 1.5 percent to $138 million; Audio Express, up 13.7 percent to $55 million; Harmony/ Ultimate, up 0.9 percent to $51 million; Newegg.com, up 15.1 percent to $46 million; BrandsMart USA, up 3.1 percent to $43 million; and Cabela’s, up 7.6 percent to $31 million in navigation sales.

The nation’s largest 12-volt specialty chain by volume — Car Toys — suffered an 8.8 percent sales decline to $124 million (excluding the chain’s cellular sales) but maintained its No. 8 position. The nation’s second largest 12-volt chain, Audio Express, grew sales by 13.7 percent to $55 million and moved up in rank to 13 from 17. It doesn’t sell cellular.

Others that moved up appreciably in rank were Systemax to 9 from 19, Newegg.com to 16 from 22, and BJ’s to 22 from 25.

Companies that dropped a few notches in rank were Buy.com to 23 from 18, Fry’s to 18 from 15, and QVC to 17 from 11.

Retailers that didn’t make the 2008 list and just missed making the2009 list include Sony stores, with $20 million in 2009 car electronics volume; regional appliance/electronics chain P.C. Richard, with $18 million; Offi ce Max, with $17 million; New York’s Sixth Avenue Electronics chain, with $16 million; Bass Pro Shops, with $16 million; automotive chain The Pep Boys, with $12 million; and Nebraska Furniture Mart, with less than $8 million.

The outlook for the Top 25’s performance in 2010 could show some improvement, based on early-2010 sales statistics supplied by The NPD Group and reports from marketers and retailers.

For the January to April 2010 period, NPD found mobile-A/V sales, including in-dash aftermarket navigation but excluding PNDs, slipped at only a single-digit 8 percent rate to $265.2 million at the retail level. PND sales were off 16 percent to $266.9 million. Last year, in contrast, mobile-A/V sales were off by 17 percent, and PND sales were down 17 percent, NPD said.

For many A/V specialists and 12-volt specialists, however, the market is up. The Progressive Retailers Organization (PRO Group) buying group said member sales of car electronics rose 5 percent in dollars so far this year. Members include Top 25 retailers Car Toys and Crutchfield and such retailers as Sixth Avenue.

Likewise, Audio Express president Mike Santacruz also said the industry “is slowly coming back” and that so far this year, he’s beating last year’s numbers.

Methodology

NEW YORK — The TWICE Top 25 Car Electronics Retailers Report ranks the leading domestic car audio and electronics dealers by sales for the 2009 calendar year.

Retail sales figures are based on information that was supplied by retailers responding to a survey by TWICE and its research partner The Stevenson Company. Absent their input, estimates were developed from Stevenson’s internal market tracking surveys (TraQline) and industry sizing based on wholesale shipment figures from the Consumer Electronics Association (CEA), average retail price points by products and other sources.

All estimates were further refi ned with public filings with the Securities and Exchange Commission (SEC), TWICE industry analyses, financial analysts’ reports, published data and other sources. Sales figures for 2009 were then compared with 2008 sales tallies and adjusted if necessary to more closely track industrywide revenue growth.

Respondents were instructed to exclude revenues received for installation services, repair services, rentals, warranties or extended-service contracts, as well as sales to businesses, government and education.

Stevenson’s TraQline syndicated quarterly survey of 150,000 shoppers measures retail purchases of consumer durables, and provides estimates of unit and dollar market share and other key data points.

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