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Distributors Discern The Top Growth Categories For 2012


Which categories will provide growth
and profit opportunities for retailers in the first
half and why?

Warren Chaiken, Almo:

I believe the best opportunity
for profit and sales growth in the first
half will be in appliances. Instead of buying new
homes, consumers are remodeling and upgrading.
The replacement market right now is quite
strong, particularly for higher-end appliances,
which provide a better profit opportunity for dealers.

In electronics, the new MAP policies will help
increase profit opportunities for TV retailers.

Rob Eby, D&H Distributing:

Tablets and
thin and light notebooks (Ultrabooks) will be hot
growth categories. By virtue of the smartphone,
the typical customer is getting used to thin, light
devices with instant-on capability and all-day battery
life. They want those characteristics to extend
to other form factors, including tablets and

Accessories for these items are a profit center
as well, since they provide higher-margins and
can be easily upsold alongside these devices.
Also, as apps
become more
of a way of
life, we see
that paradigm
infiltrating the
television experience
as well. TVs and DVD players now have
built-in apps that provide easy access to You-
Tube, Netflix, Pandora and more.

Fred Towns, New Age Electronics/Jack of
All Games:

Consumers are looking for products
that are thin, light and fast, making tablets and
Ultrabooks ideal categories for growth. Retailers
will see strong tablet sales with new product
releases, refreshing the consumer’s need for the
latest in technology. The new Ultrabook category
will generate growth opportunities and re-stimulate
the PC category.

Devices in both these categories will have
higher [average selling prices], allowing for higher
margin as well as a renewed interest in equipping
the latest and greatest with multiple attach

Stephen Bodnarchuk, M. Rothman & Co.:

Once again the emerging growth category of
tablets and tablet accessories is still upward trending. First-half 2012 revenue and
profitability forecasts for these two
categories are projected upward.

We at M. Rothman are continuing to
expand focus on these growing products
and there are some exciting developments
in this space we feel will
contribute to increased sales. The
new Android Ice Cream Sandwich
4.0 OS delivering late in the first quarter,
as well as the new
Apple iPad announcement
and introduction,
will continue to keep
the category hot. The
increased tablet install
supply base will also only help
improve sales of related accessories
across the board.

Rob Kalman, SED

we had a fairly strong
holiday shopping season,
the first half of the
year is a good time to
focus on add-ons with high-margin
accessory items and extended warranty
products. Those CE retailers
who are not yet in the PC space
should consider expanding in order
to capitalize on the opportunities
technology convergence presents.
For example, offer wireless routers
and tablets along with TVs and stereos
and help the end-user put it all

Jerry Satoren, DSI Systems:

Like last year, 60-inch and larger
flat panels will continue to be a
huge growth opportunity for retailers.
For TV in general I expect the
profit opportunity to come from the
vendors that take their new policies
seriously, stick with them, and maintain
orderly sales and marketing

Growth will also continue to come
in the tablet and home networking
space but much of the profit will be
driven by the ability to attach accessories
and sell a full basket. As
always, retailers that provide attachment
offerings and execute on the
sales floor will be the winners.

Bill Stewart, Petra Industries:

The great thing about this industry
is that amazing manufacturer innovations
always provide new opportunities
for retail growth. Categories
like iPad, iPhone and smartphone
should all have a positive impact
for the period, especially with the
impending release of iPad 3. These
categories not only help retailers on
the hardware side, but open up a ton
of opportunities for add-on accessories
— headphones, Bluetooth,
docks, cases, sleeves, screen protectors,
and others — which provide
a lot of increased profit margin opportunity.

The first half of the year is also a
good time for categories such as
mobile A/V, photo/video and home
theater. We are also seeing growth
in our appliance category, with an
increased demand for retail-packaged
appliance hook-up accessories
that can be merchandised on
the sales floor.