Distributors Reveal Most Profitable Products

We also signed an exclusive arrangement with a company called Soul, and Ludacris is making headphones for them. That’s a huge opportunity for us as well this year, going after the high-performance headphone crowd. The headphone category overall for us is on fire. After TVs, home audio and digital imaging, it’s our fourth-biggest category. We have 25 vendors for it and offer about a thousand SKUs. Now, higher-end earbuds and sports products ranging from $70 to $120 and all those points in between are doing really well; we also do extremely well with noise-canceling headphones.

*Bill Stewart, President and CEO, Petra Industries:* The great thing about our industry is that amazing manufacturer innovations always provide new opportunities for retail growth. Multiple categories like iPad and other tablets, iPhone 4, Android phones and e-readers will all have a positive impact for our retail customers this year. For instance, Verizon picking up the iPhone 4 significantly increases Apple’s market share, and the increase in options for tablets and Android phones will also provide a lot of opportunities for retailers. These categories not only help retailers on the hardware side, but open up a ton of opportunities for add-on accessories—docks, cases, sleeves, screen protectors, etc.—which is where the biggest profits lie.

*Rob P. Kalman, Vice President, U.S. & Corporate Marketing, SED International:* Accessories and add-on items. We don’t see that as a change, but the ability to add onto the sale effectively, thereby not only increasing the margins but also adding more value and uniqueness to the sale; that is more important than ever.