NASHVILLE, TENN. – Following a stagnant winter marked by severe weather and supply constraints, independent dealer members of the Nationwide Marketing Group are enjoying renewed appliance and CE sales and continued strength in furniture.
According to the management team of the retail merchandising and services organization, a recovering economy, a strengthening housing market and a slew of innovative new products will drive growth this season and beyond.
“The winter was very tough,” acknowledged Nationwide president/COO Dave Bilas. But dealers are now more bullish amid improving industry conditions and economic indicators, and had already doubled their orders year over year prior to the group’s PrimeTime meeting and buy fair last week at the Gaylord Opryland Resort & Convention Center, here.
In appliances, double-digit growth in the home builders’ channel is offsetting flat retail sales, reported executive VP Jeff Knock, and an “historic” mix-shift to higher-end kitchen packages is buoying majap dealers’ bottom lines.
On the CE side, TV sales are down 2 percent for the group, which is still outpacing the overall industry’s 8 percent declines. But the outlook for Q4 and the start of 2015 is bright as Ultra HD and OLED models hit popular price points, and the industry anniversaries the inventory tightness of the previous holiday season.
“We will be up in CE in the fourth quarter, and 4K and OLED will be the drivers,” declared electronics senior VP Tom Hickman. “It will be a 4K holiday, and the next six to eight months for the category will be phenomenal.”
The return of the TV business has been bringing Nationwide dealers back into the A/V fold, Hickman noted, while a host of new technologies, including wearables and HD audio, will help build customer baskets with profitable accessories and attachment sales.
CE dealers are also benefitting from a widening net of UPP-protected product lines, which is helping to buoy their bottom lines. “UPP is coming downstream from some vendors,” Hickman said. “It’s having a positive effect on [average selling prices] and is putting some sanity back in the industry. It helped keep some of our guys in business.”
Nevertheless, he warned of a “hypercompetitive market” for 4K in the back half of the year as pricing for new technologies compresses at an ever-accelerating pace and the window for healthy margins narrows.
“Moore’s Law demands a certain speed,” he said, and price moves are now occurring faster than they did for prior innovations like digital TV and Blu-ray.
Looking ahead, Black Friday is shaping up to be “as active as ever,” Hickman predicted, with TVs playing a larger role in the pre-Christmas promotions.
“TV is going to come rushing back with a picture, brand and size story vs. the focus on tablets of past years,” he said.
To help fan the flames of its CE business, Nationwide has beefed up its merchandising ranks with the addition of Toshiba and Circuit City veteran Doug Wrede as CE director, who is tasked with finding new sales and profit opportunities for members. The category is also the focus of a forthcoming supply-chain initiative under the direction of distribution and logistics senior VP Dean Sottile.
All told, added executive VP Knock, the current business year is proving to be a “more moderate mirror of 2013,” although “the long-term outlook is very positive” for dealers and each of the industries they play in, as unemployment is down and the GDP and discretionary spending are up.
“We’re pushing hard to raise the bar, but we’re happy with the health of our members,” he said.