The Tough Get Tougher
n Jack Baillio: From what I’m hearing, it’s going to be worse for retailers than it was last year. It’s one of those times everyone tries to make an impact. As an independent, we don’t do those crazy things others do. And we haven’t come up with anything super-special as far as offers for Black Friday. Usually, that craziness happens just in the first two or three hours. We’ll just react as we need to. If dealers have only 10 pieces of one thing, consumers just get frustrated and buy somewhere else. It ends up, in the long run, backfiring. They don’t read all that fine print in the ads that says there are only 10. But if they come to us, we’ll try to make them a deal and make them a customer. If they come for a 50-inch plasma with whatever crazy price, we’ll try to have something around it, and if we’ve got to lose on eight or 10 of ‘em, so be it. That’s just retail. But we’re not going to try to make some crazy statement, like the nationals do. It antagonizes a certain percentage of customers.
n Greg Hager: All we know is that the bottom-tier panels come from the major suppliers, with several located in Mexico. As prices go down for the top tier, then those bottom-line guys will have to scramble for parts from anywhere they can, and their profits will be squeezed thinner and thinner. I’ve noticed some dealers are dropping those no-name brands and it’s pretty much the warehouse clubs picking them up. Customers see those products as throwaways—they feel they’re not even worth repairing. Some of the bottom-tiers have warranties that are non-existent - there are no parts and service. But they’re doing a great job of selling people those ‘real deals.’