NATM's Regional Powerhouses Still Rule In TV, Appliances

In terms of size, Satoren says NATM members “must do a minimum of $50 million” in annual sales and “they must be brick-and-mortar guys. We have to have the best [in-store] experience and the best ‘brick-and-click’ experience.” He adds that members must have “a commissioned sales force” to serve and sell products with good margins and “have the same kind of [merchandise] mix” the rest of NATM members sell. “We don’t want to have members for the sake of getting new members,” Satoren says.

“Today NATM members work a lot closer than ever before,” he says. “That’s due in part to our electronics and [major] appliance committees,” which have helped set strategy and buying decisions in each category.

This practice has helped the stores stay strong in the U.S. TV market, despite it being down 11 percent in units and nine percent in dollars this year “due to a function of mix,” Satoren says. “If you look at 4K growth for the industry it is tremendous, but it is not making up for lower dollars in 1080p TVs,” he adds.

NATM’s TV sales are now “between $900 million and $1 billion” annually with its emphasis being on 4K TV and premium TVs. “Our 4K TV sales have been trending up the last number of years. Our business is flat in units but up in revenue,” so far this year. “We don’t do a lot of 32-inch or 40-inch TVs which are all price driven.”

 “NATM represents about three percent of the overall TV business in the U.S.,” Satoren says. “We have improved our mix, technology and screen sizes over the last few years. We love the $2,000 [price tag] in TVs. We are confident that we are north of 10 percent of the premium TV business in the U.S.”

In Major appliances, NATM estimates it represents six percent of unit and dollar sales, with $2.2 billion in volume and “the most productive storefronts” in the industry, Satoren says. With the trend towards IoT and the technology crossing over into major appliances, this is an advantage for NATM members.

Satoren explains, “While we are in the [do-it-yourself] area of IoT, one of our members is working on an initiative to bring a scale model home in his store to show how [IoT enabled] appliances, sensors, security will work. And it will enable consumers to walk in and visualize what it means for them.”

Michael Maund, marketing and operations director of NATM, adds, “Our members usually survive where others have failed. When IoT merges with appliances, [NATM members] will have demos in real time.” But the message is that NATM, with its electronics and appliance expertise and heritage, are perfectly positioned to take advantage of the IoT wave as it builds.

 Satoren says the difference between today’s NATM members and those from the past that went on to become national chains is that “retailers like ABC Warehouse, Nebraska Furniture Mart and P.C. Richard are comfortable with who they are and don’t want to be the next Best Buy or Lowe’s.”

The NATM executive director provided two final observations, one about retailing and his group, and another for electronics suppliers. He says, “Brick-and-mortar [retailing] is not dead or going away, and neither are any of the 12 members of NATM.” To manufacturers he gives advice on how vendors can provide profits for themselves and his members, “We respect [manufacturers] who stay true to the value of their brands and manage their entire portfolio.”

 Steve Smith was editor-in-chief of TWICE and a member of the Consumer Technology Hall of Fame.