HES Says Its Dealers Will Thrive in Tough Economy

Home Entertainment Source (HES) directly addressed its dealer base for the first time since it entered a partnership with the Progressive Retailers Organization (PRO) Group.

Jim Ristow, HES president, spoke to HES member dealers during a reception during CEDIA Expo 2008. He made it clear that the partnership is part of an effort to help HES dealers survive and thrive in the difficult economy.

“These are tough times. There’s no getting around that,” Ristow said.

He reiterated what he previously told CE Pro: that there are three major threats to the specialty consumer electronics industry:

• Consolidation
• Contraction
• Commoditization

The alliance with the Pro Group, which creates almost $4 billion worth of buying volume, will give HES companies an advantage during a challenging economy, Ristow contended. He said HES’s near $4 billion buying power rivals Circuit City’s $6.6 billion.

“We want to give our vendors a clear path to build and sell step-up products,” Ristow said. “It’s good for us and it’s good for them.”

Although Ristow is extremely optimistic about the future of HES dealers, he knows the economy provides huge challenges.

“There are going to be very few winners out there. We’re thinking way outside the box," he said. "HES is going to be that national alternative to the box stores, specialty A/V.

“When all is said and done, we’re going to be the ones left standing with Best Buy and the others.

“Instead of contraction, you’ll [HES dealers] will see an expansion. The pendulum is swinging.”

Ristow also announced that CEA PARA will provide the education at the next HES Summit on March 22–15 in Dallas.