SPRINGFIELD, N.J. –
It appeared unlikely at press time that Sixth Avenue Electronics would recover from its second loan default in six months, having fallen victim to overexpansion in a rapidly changing marketplace.
The company, which operated 19 stores in four states at its peak last year, was founded in Manhattan in 1984 by chairman Billy Temiz, who had built a chain of fashion boutiques in Turkey before immigrating to the U.S.
His younger brother Mike Temiz was named president of the now New Jersey-based business in 2003 following a split with a third sibling, Leon, who went on to found Electronics Expo within the same market.
Starting in 2009, Sixth Avenue embarked on a strategy of rapid expansion by entering the markets of Philadelphia and northern Delaware, adding more stores in New Jersey and Long Island, implementing a multimillion-dollar software management system, adding major appliances, and purchasing a 500,000-square-foot distribution center and headquarters facility from Toys “R” Us.
But beset the economic downturn, falling TV margins, and software snafus that hurt holiday cash flow, the company began shedding stores earlier this year until it was left with three locations. A loan default with GE’s inventory finance arm last spring forced the Temiz’s to take in a partner, believed to be Broadway Photo principal Albert Houllou, while more recently the company has been holding steep, liquidation-like promotions promising upwards of 70 percent-off A/V merchandise.
A second loan default in September appears to be Sixth Avenue’s swan song.
Dave Workman, executive director/chief operating officer of the Progressive Retailers Organization (PRO Group), Sixth Avenue’s longtime buying group, described the situation as “very sad and unfortunate. They tried to take advantage of an opportunity, but their growth strategy was based on what they thought the industry would look like. It shows just how dynamic and demanding the marketplace is.”
Workman said the PRO Group board will meet this week to formally address the dealer’s membership status.