i3 | August 20, 2019

Buying Groups Embrace Change

Steve Smith

The state of independent retailers and buying groups is promising as the calendar hits midyear, even with unexpected economic gyrations beyond their control.

Wild stock market swings have impacted business, and tariffs could impact major appliances significantly. But the business of independents and three of the industry’s leading buying groups — Nationwide Marketing Group, NATM Buying Corporation and ProSource — seem to be fine because they are embracing change.

These groups and retailers are selling new consumer technologies, testing new business models, networking with fellow independents to learn about best practices in online and in-store merchandising, and doing digital marketing. Most importantly, these buying groups have learned how to partner with vendors and sell products profitably.

Building on Success

Murray Huppin, president of Huppin’s and OneCall, and chairman of ProSource said at the group’s spring meeting, “No one is doing business like they did two years ago, let alone five or ten years ago. We need to evolve and see what works.”

Walt Stinson, president of ListenUp, and vice chairman of the group, added, “We look for best practices. ProSource has a lot of entrepreneurs. I try to listen, learn and be aware of what they are doing and see how their successes are achieved.” ProSource, which has retailers and custom integrators of all sizes that specialize in consumer tech products, began to venture into the lighting and shade business last year and is closely watching other tech developments that could transform the industry.

Meanwhile Nationwide, the group which consists of consumer technology, major appliance and home furnishings retailers and installers, reached a deal with AT&T to not only sell the DIRECTV package — mobile handsets and plans to consumers — but also to provide 5G or broadband “bringing the consumer solution into the home,” said Doug Wrede, vice president of merchandising CE for the group. The deal also enables Nationwide members to get 5G or broadband into their stores to display and sell the new devices.

NATM, the group of 12 regional independent electronics/appliance retailers, is not just emphasizing its premium TV business. Jerry Satoren, executive director of NATM, explained that a couple of its members “have deals with carriers” to sell smartphones and that more members are “looking at mobile with 5G coming.”

But he noted while mobile is “a no-margin business” for anyone but the device makers and carriers, the category helps “drive traffic into our stores and enables us to sell consumers more profitable big box items.”

Smart Appliances

Both NATM and Nationwide are well positioned to sell the emerging smart appliance category — part of the connected home phenomenon. Still, the consumer acceptance breakthrough isn’t here yet. Satoren’s concern is that “real consumer adoption” won’t happen until “these features move into more basic models.” Wrede said that Nationwide’s electronics retailers “are more open to embrace the technology than the appliance guys. They will be slower to adopt but will get there — they won’t have a choice.” Both agree that the major appliance and consumer technology expertise of their members will be a decisive edge for them in the marketplace as smart appliances become more popular.

The willingness to embrace change, whether it is the products they sell or how their businesses adapt to new realities, is making buying groups more valuable than ever as new technologies are introduced for the home.

July/August 2019 Issue Cover

Subscribe to i3 Magazine

i3, the flagship magazine from the Consumer Technology Association (CTA)®, focuses on innovation in technology, policy and business as well as the entrepreneurs, industry leaders and startups that grow the consumer technology industry. Subscriptions to i3 are available free to qualified participants in the consumer electronics industry.