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NATM Moves To Diversify Mix

Grapevine, Texas — NATM Buying Corp. is looking to offset diminishing TV margins by direct-sourcing a wide range of supplementary products.

Fearing that continuing price wars by tier-one TV makers could lead to category commoditization, the brown- and white-goods buying group is stepping up efforts to bring in a host of ancillary goods from China. Categories under consideration include housewares; TV furniture; seasonal items like fans, heaters and outdoor grills; and CE accessories including surge protectors and remote controls.

The imports, purchased as group programs, would help wean NATM dealers from an over dependence on TV while lowering acquisition costs for members.

Group president and executive director Bill Trawick, speaking at NATM’s annual meeting yesterday at the

Gaylord Texan Resort & Convention Center here, expressed grave concerns for the health and well-being of the TV business. “TV manufacturers are no longer driven by brand or features or technology but by price,” he said. “When one company makes a price move it chases all of them down, because if they don’t follow suit they lose business. I’ve never seen this in 40 years.”

Trawick partly attributed the price compression to reactions by national chains to slowing consumer demand. “The public companies are trying to get their volume up by discounting, but if the consumer is not driven to buy, low prices won’t make a difference,” he said.

Trawick’s comments followed what he described as a series of “significant” price moves made last week by Samsung, Sharp, Sony and LG that are a likely precursor to additional price drops before the holidays. “The [price] delta between tier-one and tier-three brands is collapsing,” he said.

He added that the group would limit its exposure to TV should the category eventually become commoditized, and would wait for the next generation of video technology to revitalize the industry.