Las Vegas – PRO Group is expanding its supply chain initiative, dealer training efforts and best practices programs to help counter what executive director Dave Workman described during its 26th annual pre-CES cocktail party as a more challenging retail environment.
The $2 billion buying organization, comprised of 18 specialty A/V retailers, enjoyed a “good year,” Workman said, the restructuring of Tweeter, its largest member dealer, notwithstanding. The group’s net sales were up 10 percent in 2006 and same store sales rose 6 percent, although the holiday season proved difficult for PRO, as it did for most retailers, he noted.
To succeed in an environment of slower growth, the group will emphasize idea exchanges between members, vendor training programs, and will expand its virtual distribution model, initiated last year with Panasonic, in which the group forecasts and orders as a single entity. Workman described the supply chain initiative as “an unqualified success,” and is expected to initiate similar relationships sequentially with two additional video vendors, and may eventually expand the program to all large vendor partners.
Workman attributed the softer holiday season to slowing flat panel sales and channel migration, as mass merchants and online retailers took share in panels sized 42-inch and smaller. “We didn’t get the lift in flat panel,” he said. “Flat panel gave us the opportunity to knock it out of the park. Now we need base hits, although base hits add up.”
He added that PRO dealers need to be “the most relevant retailers” in 50-inch panels and larger, and takes solace in the quality of his member ranks. “Cream and good retailers rise to the top.”
Elsewhere, Artisan has become the group’s newest vendor partner, while Bose has initiated a vendor training program with PRO dealers, beginning with Sixth Avenue Electronics on the East Coast and Ken Crane’s on the West Coast. PRO will also continue to execute targeted marketing efforts under a customer acquisition program with Sony and Claritas.