Many 12 volt retailers were happy with flat profits this holiday season, and some noted that the Christmas rush came late in the season.
Retailers such as Al & Ed’s Autosound (approximately 20 locations, based in Van Nuys, CA) said its sales were slightly up and profits were about even with last year. In this economic climate, that amounted to a good performance.
Freeman’s Stereo Video (7 stores, based in Charlotte, NC) also saw a slight increase of 3 percent in sales with flat profits. “I think the spending per person was up but the foot traffic was probably down…To be flat with everything looming, I’m pleased,” said General Manager J.R Stocks, referring to the Fiscal Cliff. “The media hype gets people worried.”
Car Toys (50 stores, Seattle, WA) had a good holiday, although Christmas came late. “Black Friday was incredible – sales exceeded expectations by a wide margin. From December tenth, though, through the twentieth we experienced slumping traffic. Fortunately, our customers rallied with a late surge of buyers and we appear to be ending up with a solid increases year over year. Sales are up and margins are up. We’re not complaining,” said Senior VP Merchandising, Jim Warren.
He added, “We’re seeing slowing in dash CD players offset and then some by premium double din solutions. Amplifiers, subwoofers and speakers are all performing well along with extraordinary sales of remote start products.”
A few other retailers said business was down by up to 10 percent, and one retailer, Stereo King (5 stores, Portland, OR) said sales were up by 5 percent and profits up as well for December. Stereo King added more TV advertising this year, with an aggressive late night TV schedule.
A notable trend in general retailing this year was the increase in online sales, which surged 16 percent over last holiday season, said comScore. We asked retailers what can be done to compete with online sellers during the Christmas selling period.
One leading retailer suggested that suppliers provide a holiday on MAP (Minimum Advertised Price) earlier enough in the season so that retailers may take full advantage of it.
Some retailers noted that they are finding ways to bring in consumer off the phone who ask about a low price they saw on the Internet.
“We say ‘yes,’” said John Coleman of Stereo King. “Our first response is ‘absolutely, come on down and see us. I’m sure we can work something out [when a customer wants him to match a price].” The store then finds way to negotiate a fair price and makes up the cost in accessories and labor. “It’s an attitude. Let’s make it happen. On that one item we’ll do it as the same price on the Internet to build his trust and then add the accessories. You don’t get them in by saying, ‘no, we can’t do it for that price.’ It’s an attitude of cooperation.”
Car Concepts, a single store in Salt Lake City, UT has the same strategy. “Our radio advertisement says ‘we’ll match pretty much any online price within reason. Why wait to get free shipping and come on down and see us today,’” said Ryan Goeller.
Source: CEoutlook
