Retailers are starting to consider the long game in working around a lack of head units and other car audio products that are in short supply.
Two-store Autosound, Inc. in Indiana, now has pictures of head units on its demo boards instead of actual demo units.
Some dealers are skimping on promotions and spending that time instead finding product.
Tom Kolar of MidState Distributing said, “It’s great to have the extra business and the increased sales but when you can’t find the product to make it happen and it’s so labor intensive to find it, it’s difficult to make that happen on an everyday basis….Promotions aren’t as important right now, it’s just finding product.”
One distributor said after receiving a shipment of four head units, “What am I going to do with four units. Cut them in half?”
Robert Hough of Autosound & Security in IL switched to appointment-only sales, and taking full deposits for a job if the customer wants a specific product. The customers are accepting those terms because they’ll call other shops and find they are also out of inventory.
Unfortunately, many smaller dealers can’t afford to spend the time on the phone trying to find product. Instead, some are buying head units from Amazon, which may have a greater supply than their distributors, said both distributors and retailers.
Three-store Jodi OConnor of Jo-Di’s Sound Centers, CT said the chain’s policy is,”As a company, we aren’t comfortable buying from Amazon when it comes to hard goods and then trying to resell it, it would lead to warranty headaches. I would rather have the customer buy it and say to the customers, ‘I’ll do the install for you but I can’t stand behind the product.'”
The industry is also adjusting to the lack of head units in many other ways.
Like others, Autosound, IN, has taken to “pre-selling” product, according to owner Harvey Wright. When a product is sold out, “Some say put my name down and we require a 50 percent deposit so they’ll do a booking and by the time I can get them into the shop, a week to ten days, the product will be here.”
One good thing about the shortages is it creates an urgency he said. “You better get it while we have it,” he tells customers.
On the other hand, some customers are walking out empty handed. “It’s cutting into sales. I know personally, I have literally lost $10K in sales. Here’s my analogy. If McDonald’s runs out of hamburgers, you might go to get fries or a coke, but chances are you won’t. Even though radios are a smaller and smaller part of our business, it’s still the hamburger; everything revolves around it,” said Wright.
Richard Grimm, President Cartunes in Atlanta, GA. says the shop is installing more systems that keep the factory radio. Sometimes this is a temporary install, until a head unit becomes available.
“We convince them that nobody else has them either. Either they are willing to wait or [we] go ahead and put a system in on the back of their factory radio and they come back later. Most wait… It’s still very busy. We do a lot of installed radar/laser systems. We’re one of the top two ESCORT dealers and they have been able to supply us. There’s no problem with that supply chain yet. That is keeping us busy. We’re at the point where we’re still booked out a couple of weeks.”
Smaller retailers are especially hard hit. Manufacturer’s Rep Pete Daley of Marketing Pros, TX said, “Inventory is king. If you don’t have inventory, you’re not in business …we try to force [dealers] to buy more often or to buy more. If they ordered last week, we make them order again, maybe in small amounts. Cash flow is still an issue for some of those guys.. We ask what did you sell the past weekend or last weekend and get them on backorder right away.”
He added, “Small to moderate retailers that’s the backbone for our industry. We have to make sure these guys survive.”
source: https://www.ceoutlook.com/2021/07/26/if-shortages-last-for-another-year/
