The group’s membership of independent majap, technology and furniture retailers, representing more than 10,000 storefronts and $15 billion in buying power, has watched the struggling big-box chains close scores of stores, ceding whole markets to their competition, and, with the help of Nationwide’s “Prepare For Share” initiative, launched two and a half years ago, were and are prepared to pounce on the opportunity to fill the void.
“It’s time,” said Nationwide (NMG) chief commercial officer Jeff Knock. “The big-box channel is in a state of chaos. We have been preparing for this through our Prepare For Share program. Sears, hhgregg, Staples … the opportunities for our membership continue to grow. We consider this a call to action.”
The fruits of NMG’s labor have begun to ripen. “Business is good, overall,” said chairman Dave Bilas. “We’re enjoying some nice lift. For the appliance industry we have been encouraged by the economy — housing is up and we’re getting a tailwind there. And we’re seeing a trend toward premium products. [Big-box] store closings have boosted us in some areas of the country. Overall, we’re looking at a 3 percent to 5 percent boost in units this year. The outlook for 2017 is very, very good.”
The group’s retailers saw 20 percent growth in dollars in consumer electronics sales in 2016, according to senior exec Tom Hickman. Much of the growth was driven by the success of high-end 4K Ultra HD TVs from member vendors Samsung and LG, but also influenced by the mainstreaming of distributed audio products and the rising popularity of sound bars, Hickman said.
Major appliances saw nice growth as well, according to senior executive Patrick Maloney. “The industry was up about 5.5 percent in 2016 and we expect the same in ’17 and ’18. Our challenge is the potential channel shifts and how we can steer those shifts to the independent retailer. You can say what you want about Sears’ [weaknesses] but the reality is they still sell a strong mix of high-end products, a great mix of profitable products for manufacturers. We’re working hard to figure out how to make that happen in our stores.”
NMG’s leadership also cited furniture and bedding as categories that continue to be strong, and sees more opportunity with new initiatives in outdoor lifestyle, which the group calls “cooking, heating and seating.”
Knock called the marketing opportunities for outdoor “a perfect storm. It’s a blending of all our categories, especially on the high end, and we are very optimistic about it.”
In addition, NMG’s recent partnership with Nest and its Works With Nest program and merchandising kiosks are expected to boost members’ presence in the growing connected-home market. “This will give us the national footprint we need to succeed in that area,” Hickman said. “We are the only buying group with a Works With Nest program, and when we rolled out the kiosk in some of our meetings the members were just beside themselves. We have a product plan, we have a merchandising plan, and what we call a ‘pro-tail plan’ so our guys can not only sell it but install it.”
According to Bilas, PrimeTime drew more than 3,400 attendees, a 24 percent jump from last year’s spring event, representing more than 900 member companies and close to 200 vendor companies.