November 2006 Issue

 

10 Simple Ways to Increase Your Importance to Key Vendors

• Develop relationships with upper management. In the end, everything revolves around relationships. The closer you can be to the folks who run the show, the better off you are. These are the people who can make exceptions and bend the rules. They’ll do these things for you if you’re an important customer. • Support the full line. There’s no better way to become important to your supplier than supporting the full line. You see, there’s a cost to servicing your account, regardless of how much you spend. The more broadly you buy, the more those costs can be spread over multiple products. Your account


A Pillar of theCommunity

Located in one of the most thriving shopping areas in America, just off the Third Street Promenade and a stone’s throw from the Pacific Ocean and the world-famous Santa Monica (Calif.) Pier, TV Authority Santa Monica is much more than just an A/V store. It’s a hybrid retail store/custom installation firm that can do something as simple as selling a TV to something as complicated as installing a full-blown home theater and whole-home automation system. Lots of C-businesses can say the same thing, of course. What makes this location much different is that it’s also an art gallery, a swank venue for events, an


Beyond Installation

Most people who venture into the exotic world of Gramophone in Timonium, Md., probably say they’ve never seen anything like it. The 15,000-plus-square-foot space showcases four home theater scenarios at budgets from $15,000 to $150,000. Another section of the store features a five-room digital home that promotes lighting control, home automation, motorized shades and LCD TVs built into bathroom mirrors. Then there’s the standard retail setting, with TVs, receivers and speakers spread out along the wall. The store has told this three-part story since 1998, although the products and styles have changed along the way to keep up with changes in both home fashion


Can You Afford a Personal Assistant?

If you’re the owner of a CI business, you should consider hiring a personal assistant. I know you’re thinking such a luxury is reserved for Fortune 500 CEOs, but not anymore. What makes you successful is your attention to the important aspects of your business. You want to spend as many hours of the day as you can dealing with the big issues, like relationship development with custom builders. Or overseeing personnel development. Or pursuing new competencies for your company. What you shouldn’t worry about are the nagging details and follow-up. Chances are you’re foisting those off on a high-ranking individual in your company, which means that


Cultivate(and Keep) Happy Campers

“Beatings will continue until morale improves!” This famous phrase isn’t just hilarious because of its stark irony, but because of how much it demonstrates the frustrating difficulty involved with motivating and retaining a finely tuned workforce. The beatings only work for so long until you have to get more creative. So what does work? Employee incentive programs? Raises? Bonuses? Paid vacation? A 401(k)? A trip to Tahiti? None of those can hurt, but in each case, the more important question is, “Will it help?” The answers can vary. More than any of those ideas, however, C-businesses told us that consistent, plentiful training is


Everybody’s a Star

Imagine meeting someone for the first time at a party. He or she takes an immediate interest in you, not just asking what you do for a living, but about your family, your fantasies, even your emotional needs. And beyond the typical handshake, this attentive new acquaintance leaves you with keepsakes of your meeting: chocolates, a ride home and a business card. And not just any chocolate, but gourmet chocolate flown in from France. And not just a ride, but a stretch limo with the gift of a shiny martini set waiting for you in the backseat. And not just a


Hot Technology That’s PrettyCool

With plummeting margins on flat-panel TVs and stepped-up competition on the installation side from high-volume retailers, CEDIA dealers are looking to protect their profits with products and services that big-box retailers can’t provide. HVAC (heating, ventilation and cooling) control is one of those product/service categories that could take on a larger role in the custom electronics picture going forward. It may not have the glamour or glitz of a flat-panel TV, but installers can use HVAC as an attractive option in an overall home control package. The good news is that the benefits of HVAC are relatively simple to explain. When pitched, homeowners can


Ken Smith

Smith, the founder and president of Custom Electronics in Falmouth, Maine, recently chatted with CR’s Nancy Klosek. Many CEDIA installers have hobbyist backgrounds that drew them into their current businesses. Your background includes a stint as a management consultant with a Fortune 500 company. Does that give you a somewhat unique perspective with which to approach the tasks before you as CEDIA’s new president? Are you a hobbyist as well? I worked for Digital Equipment Corp. as a management consultant, and had the chance to interview many in the company and discover what went on, what issues abounded. I also provided training intervention


Let’s Talk - Bruce Jacobs

As you read this, it’s well into November, and you already have a pretty good idea of how the rest of your year will play out. On the other hand, I’m writing this before the holiday season has begun. As I speak, it’s not even Halloween, and we’re smack in the middle of the World Series. Now, I don’t believe in time warps; if I did, I’d encourage you to contact me so I could place some retroactive bets on the Series games for you. Anyway, I’d say you definitely have the advantage on me of having gone through an additional couple of weeks of C-business.


Let’s Talk - Joe Paone

Have you seen that Wal-Mart commercial yet? The one that plays up every cliche about snooty specialty electronics retailers imaginable? I’ll bet much of the public has. Heck, I normally hide from programs that would even contemplate Wal-Mart as a sponsor, and I saw it, so I’m assuming it’s burrowed its way into the national consciousness. Anyway, it’s safe to say that most of the people who have seen this ad have never set foot in one of your stores or showrooms. And it’s easy to reinforce stereotypes when a viewer has no real-world point of reference. This is what C-businesses are up against. Wal-Mart is telling


Marketing Circle Elasticity

In speaking with numerous entrepreneurial companies, both manufacturers and retailers, they almost always fail to realistically look at the size of the market in determining their approaches to sales and marketing. I need more fingers and toes to count the number of companies that totally overestimate the size of the existing market they are entering. This failure to realistically look at the market is partially due to the lack of accurate, readily-available data about our market. As a result, in many situations, the overly optimistic entrepreneurs run their businesses with a very false sense of market size. Additionally, many companies work towards higher sales levels without


Spotlight: Front Projectors

Seven leading vendors in the category talk about market conditions and their unique contributions to the product mix Planar Systems Jim Davis, Global Head of Sales, Planar Specialty Home Theater www.planarhometheater.com What’s the biggest challenge facing the front projection market right now? Like most video categories, price/margin compression is the biggest challenge. Several manufacturers are trying to win market share by driving price down without getting the kind of uptick in sales volume necessary to be profitable. Most consumers still don’t know what front projection can do, and mass marketers aren’t helping. The custom channel is the only place where front projection


The Four Metrics of Success

In his book, First, Break All the Rules: What the World’s Greatest Managers Do Differently, Marcus Buckingham put forth one of the best definitions of high-performance companies I have ever heard. He suggested that when comparing corporate performance, four metrics could be used to gauge success. The first two measures—growing sales and increasing profits—would seem obvious. Growth and profitability would be included in any standard performance definition. But in his definition, Buckingham added a high degree of customer loyalty and low staff turnover as key predictors of business performance. Although it’s difficult to accurately measure these corporate attributes or to value their worth


The Real “Grey Market”

McKeesport, Pa., a river town just outside of Pittsburgh, appears to be dying. Without the economic underpinning of the local steel mill, which shut down in the mid-1980s, shops along the main drag are shuttered, apartment buildings are abandoned, and wooden porches are rotting off the fronts of condemned homes a century old. These decrepit neighborhoods hardly seem a fertile market for custom install. Local integrators, however, tell a visitor to look closer: There’s a hidden population in McKeesport that’s not only open to the latest home automation products, but needs them now. McKeesport is part of Allegheny County, identified by the U.S.


Where’s the Housing Slowdown?

In early September, Walt Stinson, co-founder of Denver-based C-tailer ListenUp, was watching the housing markets like a hawk, looking for signs of a local slowdown. “The leading financial indicators that we track are warning us to prepare for a slowdown of business, but we haven’t seen it yet,” Stinson said. ListenUp has MBAs and a financial analyst on staff to help it navigate local conditions, but sobering statistics on the downturn of the national housing market are easy to find. By the National Numbers To wit: * The U.S. Census Bureau reported housing starts in August 2006 were down 6 percent from July


Why Buy from Us?

You can’t turn on your television today without seeing powerful ads from Wal-Mart, Circuit City and Best Buy that preach to viewers that they are the places to shop for all of your home theater needs. They offer everything we do, and for less—or so they claim. Welcome to the new world of being a custom retailer, A/V specialty dealer or custom installer. Let’s face it: The big boys are going after our segment of the market, our specialty. So how can we differentiate ourselves and still attract those that prefer personal attention and fanatical support? Our CFO/COO Mike McMaster and I discussed this dilemma