Ultimate Electronics' president and chief operating officer talks about leading the recently bankrupt specialty chain out of the woods and into the light
Ultimate Electronics, the Thornton, Colo.-based specialty retailer that had aggressively expanded throughout the Mountain and Central time zones after going public in the late 1990s, had fallen on hard times by early 2005, as it declared bankruptcy, exited certain markets and closed more than half of its stores.
As Ultimate hit bottom, Mark Wattles, the founder and former chairman and CEO of the Hollywood Entertainment video and game rental empire, as well as an Ultimate stockholder and huge fan of the Ultimate concept, maneuvered to take control of the company from founder Bill Pearse and former president/CEO Dave Workman. In April 2005, Wattles and his partners acquired Ultimate and took it private. A month later, Randall Baumberger, the former president of Hollywood Entertainment's Game Crazy retail chain who had previously held senior executive positions with The Walt Disney Company, GES Exposition Services and PepsiCo, took the reins as Ultimate's president and chief operating officer.
CR Editor-in-Chief Joe Paone recently caught up with Baumberger to discuss Ultimate's present and future.
What has changed about Ultimate Electronics since Mark Wattles and his partners acquired it?
Mark and I bought the company back in April . As you can imagine, being a public company, going through the financial struggles they had, there were a number of issues when we took over, first being that obviously when a company has financial issues, the first thing they let go is their merchandise—and more importantly, probably the merchandise that turns a little bit slower but is also the fun "wow" product that people like to see when they come into the store. So merchandise in the store had become stagnant, had become stale, and frankly they were out of stock on some of the products that had made them great. On the people side, when you go through a challenge like they had gone through financially and [overexpanded], they lost a lot of their good players, lost a lot of their strongest sales folks [and so on]. And from a marketing position, they had really kind of lost their way as far as [what] their position in the marketplace versus the big box [was], what kind of products consumers can expect to see when they come in, and really what was all the differentiating pieces from the competition.