Business is largely holding up for members of the Nationwide Marketing Group, dealers and group leaders reported.
The retail buying group, which convened here earlier this month for its biannual PrimeTime! show and conference, said members are countering the recession by cutting costs, leveraging the group's buying power, utilizing its services, and returning to the conservative, fiscal fundamentals that many of the businesses were built on.
“The situation has been very tough over the past six months and continues to be tough, yet our dealers seem to be doing well,” observed Robert Weisner, member services executive VP.
Indeed, net sales hit a record $12 billion in 2008, largely on strength in electronics, while the new year was also off to a strong start, with TV unit volume up 23 percent in January and major appliance revenue flat despite widespread industry weakness.
Members' resilience was also reflected in the attendance at the show, which was down only 7 percent from last year's 2,800, compared with steeper percentage drop-offs at other recent industry events. Nationwide had anticipated a much lower turnout given the challenging economic climate, and admittedly beat the bushes to drum up traffic. “Dealers wanted to stay home, close to their businesses, but we made them understand that this will help them be around for the long term,” Weisner said.
To help ensure their longevity, Nationwide has forged a new relationship with TCF Bank, which is “working with dealers to aggressively establish credit lines” for inventory financing, and is partnering with GE Capital, Citibank and Wells Fargo to provide private-label credit programs with acceptable approval rates for customers, said Les Kirk, the group's financeand operations executive VP.
Despite the headwinds, 2009 represents “the greatest opportunity I've seen in my life for the independent to gain momentum,” said Nationwide president Ed Kelly, beginning with the $4 billion in TV volume that Circuit City and Tweeter left behind. New efforts to help Nationwide dealers get their fair share include:
- inexpensive display-fixture programs for appliance dealers looking to add TV;
- extensive consumer research to better understand current customers and attract new ones;
- expanded relationships with tier-one video vendors, including LG, Samsung, Sharp and Toshiba;
- the addition of Haier to the video roster, to address the opening price point segment;
- a direct-sourced cable and accessories program that can provide steep margins, and the expansion of a Toshiba laptop program through distributor SED;
- a new relationship with InstallerNet, which can provide dealers with third-party custom-install services or outsource jobs to installers from Nationwide's Specialty Electronics Nationwide division (SEN);
- additional classes, offered both at PrimeTime! and in the field, that address such back-to-basics retail disciplines as cash flow management and inventory control; and
- helping dealers obtain low-cost loans from the Small Business Administration.
“Times are tougher,” Weisner said, “but if we stay strong and do what we need to do, we will come out on top."
For more on Nationwide PrimeTime!, see the April 6 issue of TWICE and visitwww.TWICE.com.