ProSource Emphasizes Managed Services, Bolsters Core of Power Members at Annual Meeting
During the press meeting at this years ProSource conference, Dave Workman wanted to avoid a "groundhog day" situation with the same quotes and narratives from The Summit in Nashville. However, it is seemingly unavoidable when he is finding so much foundational success within the group.
Workman's most significant accomplishment appears to be the growth of his Power Member core, a group of 71 members that generate at least 4 million in annual sales each year. The CEO and President of ProSource also notes that the sheer size alone of just those individuals is one of the most competitive groups assembled and will likely be the greatest single segment growth for the buying group.
"Being over 70 [memebers] at this point, and because of the size of those individual members, and you put that on top of what Pro [Members] do, add in the 400 and some odd CI dealers, you start to see the strength of this organization," Workman said. "I expect, over the next couple of years, you will see that be the larger areas of growth as these dealers 'grow-up'."
One of the reasons they have seen so much growth is because working groups - roundtable "true information sharing" between dealers in non-competitive markets - has been supported by BRAVAS. BRAVAS has not only been a loyal partner to ProSource but "about 75%" of their members were already in ProSource to being with.
So when it came time for BRAVAS to align with one group, ProSource was their obvious choice. That, in turn, padded their Power Member core with some of the highest quality members to date. On that same token, Workman notes that for how large the base gets, there is a calculated ceiling to it. The board of directors has to approve all Power and Pro Members, and there is always attentiveness to the impact of each individual region.
"We will not overload a market with Power Members. There is some consideration for how many dealers we have in a market." Workman said. "There are still a lot of opportunities; there are a lot of markets out there. But we are pretty excited about where that is going directionally."
Workman also invited the recently appointed Vice Chairman Walt Stinson and chairman of the board Murray Huppin to weigh in on some of the success and initiatives of the group, offering expertise from both sides of the integration and custom retail industries.
"One of the things that has begun happening at ProSource is that we are really having an impact on people's bottom line," Stinson said. "We're not just a fraternal or social organization. The impact on these people's business' is material to their financial health. Those are the things that are really important to us and those are the things we focus on."
"There's a sense that there is some momentum behind that," he added. "It's not just some marketing phrases for how our group is successful; we are actually delivering on those points."
Managed Services are Imperative to ProSource, Future Success
Fully aware of every twist and turn of the economy, Dave Workman can't help but stress that the industry is due for another recession.
Even if his group feels a bit more prepared to weather that storm, nobody is safe from the "brushfire that burns up companies" like 2008 did. He notes that the immediate future should be steady growth for everyone, but something like a TV tariff could be the wild card that shifts everything at the drop of a hat.
To that same point, Workman also recognizes that it could be the dealer that services themselves out of business, stressing managed services as a "critical" component to their future. As pricing and margins change, the evolution of the dealer that remains committed to maintaining a consumer relationship becomes reliant on whether or not they adopt this new mindset.
That's not to say labor won't always plague the industry - for now at least - but the correctable actions start with figuring out how to make the dealer more productive with managed services.
"One, it produces a recurring revenue back to the dealer, much like a security business and there is a value associated with that," Workman said. "Two, it improves the service to the consumer. Three, and most importantly, it improves productivity to the dealer."
Workman's solution involves OneVision and the newly founded Parasol as two critical partners for remote servicing. Exclusive partnerships with SnapAV, Control4, OvrC, and Nortek Security are also "major pieces of the puzzle," as most dealers won't touch a build without overhauling the network first. And while lighting and shading are essential product related issues, there are fundamental shifts to make the members better business in the basic structure of what they do.
"Our job is to think not what today is but to think about what two or three years out looks like," Workman said. "I think we've got the stage set for that next evolution of productivity, efficiency, and service. We can never give up our service position to the consumer. That's what differentiates us."
"We are trying to make sure our dealers have the right business model and the right structure to last through whatever slowdown occurs when it does occur," Workman added. "Enjoy the good times, but, once again, we all know this is a cyclical market."