The New H.H. Gregg Owners Seek to Avoid the Pitfall of Excessive Growth which Doomed the Original -Taking a Cue from Amazon, new H.H. Gregg locations will be Based on a Smaller Footprint and Strategic Expansion Plans
SOMERSET, NJ / ACCESSWIRE / September 23, 2019 / After 64 years in business, stalwart electronics retailer H.H. Gregg filed for bankruptcy in 2017. Its intellectual property was purchased by New Jersey-based holding company Valor Group, LLC., who outbid behemoths Sears and BestBuy to secure rights to HHGregg’s e-commerce site as well as its customer files and trademarks. Within months, Valor re-launched the H.H. Gregg website, and in a number of retail trade interviews indicated they would indeed be reopening physical locations. That first location opened with great fanfare on September 5, 2019, at the Cedar Grove Shopping Center, 120 Cedar Grove Lane Somerset, NJ 08873.
Press photos of the grand opening event, which included a ribbon cutting by Somerset County Mayor, Phillip Kramer; Township Councilwoman Crystal Pruitt; and H.H. Gregg executives are available here. Video of the grand opening event is available here.
The H.H. Gregg store will feature all major consumer electronics brands such as Apple, Microsoft, Samsung, LG, Sony, Dell, Panasonic, Philips, Dyson, DJI, Sandisk, Western Digital, and Garmin. Also camera brands such as Nikon, Canon, Fuji, Olympus as well as kitchen appliance brands like Kitchenaid, Cuisinart, Breville, Hamilton Beach and Bosch.
“We definitely see the value in a brick & mortar location,” said Valor Group, LLC., Director of Retail Operations Eli Sapharti. “And we are also intimately aware that physical locations and overly rapid expansion is death to any company aiming for long years of success.”
It is well agreed that unreasonably explosive growth is what ultimately killed H.H. Gregg. In 2008, the chain counted 91 stores in nine states. As the recession took hold and consumers stopped spending and other big box stores such as Circuit City and Mervyn’s closed down, H.H. Gregg ‘s strategy was to take advantage of the rock-bottom lease opportunities. By 2015 it peaked at a total of 228 stores in 20 states – some of them in the Circuit City spaces left vacant by their own bankruptcy. In a chillingly accurate 2010 prediction, the Baltimore Sun quoted Howard Davidowitz, chairman of brokerage and consulting firm Davidowitz & Associates: “I understand this is a once-in-a-lifetime opportunity for them. Does that mean H.H. Gregg should bet the company on this opportunity? I wouldn’t do it.”
While the new space, at just under 2,000 sq. ft. is smaller than what consumers were used to with H.H. Gregg, its size in fact makes sense given the new state of retail and the ongoing “Retail Apocalypse”. Major retailers such as Amazon, Nordstrom and Kohls are following a similar game plan by opening brick & mortar locations where consumers can handle and test the merchandise. With an electronics-focused company like H.H. Gregg, this strategy makes perfects sense. It’s been estimated that 60% of males age 18 – 34 – the prime customers for electronics – prefer to try out gadgets in real-life before purchasing. And 55% of shoppers across all ages also go to a physical store before ultimately buying online.
“We’re very aware of retail trends and the emerging strategy of a smaller physical location,” explained Sapharti. “Combining market trends with our own analysis of 25 million H.H. Gregg customer records, we recognized this is the most effective way to keep providing consumers with the same service and trusted name that H.H. Gregg built since its founding in 1955.”
SOURCE: H.H. Gregg
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