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Emotiva Audio Plans Retail Distribution

Franklin, Tenn. – Direct-to-consumer audio supplier Emotiva Audio is bringing its selection of audiophile components to the retail channel.

The company, launched 11 years ago as an affordable audiophile brand, expects to sign 30 to 50 online and brick-and-mortar U.S. retailers by the end of the year. The company is pursuing A/V specialists and integrators to build its brick-and-mortar dealer base and online retailers offering a high level of customer support..

Emotiva is also exporting its new strategy to other countries through international distributors, six of which have already been signed. Consumers in other counties previously had to buy direct from Emotiva.

“This is incremental business for us,” said president Dan Laufman. “This is a journey, not a race. We are taking our time getting quality partners.”

As part of its strategy shift, Emotiva is offering “industry-standard margins” to retailers while maintaining current price points, which will be the same at retail as in Emotiva’s own online store, said Laufman.

Until recently, he explained, “it would have been challenging [to sell simultaneously through retailers and direct to consumers] without raising our prices at retail.” But the company has increased its production scale and is building smarter to make it possible, he said.

“The combination of scale and our U.S. manufacturing initiative, which allowed us to return manufacture of new and upcoming products to our facility in Tennessee, allows us to increase efficiencies without affecting quality, making it possible to bring Emotiva to consumers who prefer to buy audio at retail,” Laufman added.

Emotiva will sell direct to retailers and has created brochures and POP to support them. The company also plans to offer online training and biannual dealer-training events at its office complex here near Nashville, Laufman said.

The company is changing its distribution approach because of distributor, dealer and consumer demand, Laufman said. “For the past two to three years, we have been getting call from distributors and retailers, and from consumers who ask where they can hear the products,” Laufman explained.

Retail distribution will expand Emotiva’s potential customer base by reaching consumers who don’t want to hook up more complex products but want specialty retailers or integrators to do it for them, he added.

Although it’s now launching a formal dealer program, Emotiva began selling a handful of retailers  more than a year ago, and then went to International CES in January to test the waters further. Dealer and distributor response at the show, Laufman said, was “quite overwhelming.”

The company’s current lineup of stereo and multichannel amplifiers, DACs, preamp/processors, and accessories such as cables are available to retailers, and more products are on the way. Planned products include two new pint-size USB DACs shipping in the coming weeks, two more DACs before the end of the summer, eight home theater and two-channel electronics products by the end of the summer, and new speakers due in the third quarter to replace models that have been discontinued.

Like Emotiva’s other products, the new products will “deliver an audiophile experience without the unrealistic price points,” Laufman said. “We have no direct competitor in quality, value and performance,” he contended, citing Emotiva’s lean organization and the amount of “fat” in the margins of other companies’ made-in-Asia products. ”We’re profitable, but we’re not greedy,” he said.

Under its domestic manufacturing initiative, the company is moving as much manufacturing as is “practical” back to its production facilities in Franklin from China, Laufman said. U.S.-made products will include all of the new products being announced in the next three to six months. By the end of this year, Laufman expects half of its revenues to come from U.S.-made products, rising to 70 percent by the end of 2016.

“The unusually large competitive advantage that China enjoyed for a decade or so is going away,” Laufman contended. U.S. and international audio consumers prefer the made-in-U.S. label, he added. “It’s time for us to bring it back to the U.S.”

Emotiva is owned by ODM/OEM audio supplier Jade Designs, a family-owned company that tapped the retail market before, having purchased the Sherbourn component-audio brand in 2010 and launched Bob Carver-branded tube amplifiers in 2013. Jade dropped the Sherbourn brand two years ago because dealers and consumers preferred the Emotiva brand and its pricing structure, Laufman said. Jade and Bob Carver parted ways. The changes “allowed us to focus all our energies on one brand,” Laufman said.