Why New Age Electronics?
Access to high-demand products, competitive pricing and better product allocation make New Age an obvious choice for your full-service distribution partner.
A Miracle of the Modern Supply Chain | Increasing Price Points | New Age Electronics Eases the Load For Alex International | New Age Electronics' Creativity Aligns Big Lots and Hewlett Packard | The Write-Off That Never Was
A Miracle of the Modern Supply Chain
In 2004, an international-based consumer technology company successfully brought to market a branded PC with a new global partner with a range of associated peripherals such as digital cameras and printers.
Challenge
The vendor wanted to manufacture the components and accessories of the product line in Asia, after which the company would find a reputable, low-cost partner to manage logistics in the U.S.
With demand high for the new products, it was critical that the goods flow through the supply chain with a minimum of friction: any solution that reduced the time between the arrival of the products in the U.S. and their availability to consumers would result in additional revenues for the manufacturer and the company's partners.
Initiative
New Age presented a logistics program for storing products, order fulfillment and shipping. With New Age's low-cost operations and four distribution facilities strategically located in North America, the company can reach any U.S. destination within 1-3 days.
Flexible services enable New Age to pick, pack, and ship in bulk or "eaches." And the company's expertise and advanced systems enable them to consistently achieve 99.98% accuracy on shipments.
Results
In addition to proposing a competitive, cost effective program to the manufacturer, New Age's ability to go beyond simple distribution saved the company time and money. When the first shipment arrived at New Age's warehouse it was discovered that 1,000 units had faulty styluses.
Working with a traditional third party logistics company, the company would have been required to return the entire shipment back to the manufacturing facility, incurring considerable cost and creating a 6-week delay with deliveries across the Pacific and back. This was unthinkable when the product had already been announced to the public. New Age was able to replace the styluses and still ship to distribution centers on schedule.
Increasing Price Points
With more than 1,000 storefronts in 46 states, this leading Fortune 500 retailer now has a dominant presence in the consumer technology industry.
The Challenge
This national retailer partnered with New Age to sell refurbished consumer electronics products. The company was looking to increase its revenue stream with additional product offerings, but given the store's budget-conscious customer base, it only felt comfortable selling at low price points (under $39.99). This automatically restricted the number of products that New Age could offer and could potentially close the door on valuable revenues for both the manufacturer and the retailer.
The Initiative
New Age accepted the challenge and submitted a plan to incorporate lines at higher price points. If the launch plan was a success, New Age felt its customer would be more inclined to include higher end products in the future. Based on New Age's recommendations, the chain was selling over 50,000 refurbished units on an annual basis.
To broaden the scope of the partnership and unlock new revenue opportunities, New Age used its excellent relationship with the retailer's marketing operations and its deep understanding of the dynamics of the consumer electronics environment to broker a deal that would allow for the introduction of a limited number of refurbished products at a higher price-point ($59.99). The trial was a great success.
The Results
Today, the retail chain sells 100,000 remanufactured units yearly at prices up to $99.99. The store has broadened its product range – offering its customers greater choice – and dramatically increased the revenue it generates from selling the refurbished products. Furthermore, New Age even assessed the impact of increased refurbished sales on the vendor's new, higher-priced products, concluding that, because the retailer does not advertise nationally, there would be little or no chance of the lower-priced units diminishing demand of new releases.
New Age's creativity, knowledge and sensitivity to the needs of its retail and manufacturing partners allow it to create programs that benefit all.
New Age Electronics Eases the Load For Alex International
Alex International of Irvine, CA distributes products from some of the world's leading technology brands to dozens of retailers throughout Southern California – and even to such distant markets as Guam.
The Challenge
Alex International has worked hard to balance the demands of its retail partners with the logistical and financial challenges of ordering products from the biggest names in technology. The goal was to incorporate a Panasonic line into its product offerings for its retail base.
"As a small organization, we don't have the leverage to ask manufacturers to ship unusual volumes of a specific product or insist upon tight delivery deadlines," explains Alex Memon, Chief Executive Officer of Alex International. "Large vendors like Panasonic – which makes some of our best-selling devices, from DVD players to TVs –cannot accommodate distributors near the edge of the supply chain, and we don't have the inventory capacity to meet every request our retailers make."
Furthermore, the company, which has a small staff, has to maintain a laser focus on its customers 24/7.
"We need to be out in the field making deals," says Memon.
The Initiative
Alex International found a way to provide its stores with a wide variety of product SKUs and still fulfill orders in days or hours – all without sacrificing valuable time negotiating complicated deals with manufacturers or investing in costly storage space.
Memon has integrated his operations with those of New Age Electronics. Offering a wealth of value-added services, New Age brings manufacturers and smaller distributors closer together than ever before, creating a seamless, networked supply chain of unprecedented efficiency.
The Results
By virtue of its close relationship with Panasonic and its ability to manage inventory on behalf of its partners, New Age provides Alex International's customers with a range of Panasonic products on a just-in-time basis, absolving the Irvine company of the need to buy and store excessive inventories. In addition, New Age secured for Alex International dealer authorization status from Panasonic and even arranged third party (flooring) financing.
New Age has helped Alex International achieve margins of 15-20 percent and has secured consistent increases in revenue and profitability for Panasonic. And, by taking on the risk and many non-core responsibilities that often encumber distributors, New Age has been able to allow Alex Memon to focus on what he enjoys most.
"The expertise New Age Electronics brought to the table allows me to concentrate on serving my customer base," he says.
New Age Electronics' Creativity Aligns Big Lots and Hewlett Packard
Big Lots, with more than 1,500 stores nationwide, has built a $4 billion retail business by offering its customers "brand names at closeout prices."
Challenge
When it comes to selling consumer electronics products, Big Lots faces some unique challenges. Digital cameras and printers have lifecycles measured in weeks rather than months, so the redirection of surplus inventory from other stores to Big Lots had to happen quickly. Meanwhile, the task of pricing consumer technology from brand-name manufacturers at a level that attracts budget-conscious consumers – while maintaining margins – can seem impossible.
Initiative
New Age identified an opportunity to bring to market surplus Hewlett Packard printers, scanners, multi-function machines and digital cameras through Big Lots' extensive nationwide retail network. New Age structured an agreement so that both HP and Big Lots enjoyed healthy margins – no easy feat given the competitive pricing Big Lots' customers expect.
New Age reassured Big Lots that the devices would spend the absolute minimum of time in warehouses in order to hasten their arrival on the retailer's shelves. More important, the company created an original bundle comprising a digital printer and scanner. Sold on the bundle's attractiveness, Big Lots committed to the deal.
"New Age really handed us an impressive package and somehow managed the process so efficiently that we able to offer the HP products at incredible prices while maintaining strong margins," said Ralph Smith, Buyer at Big Lots.
Results
New Age managed all aspects of the shipping, packaging and distribution process and quickly turned around tens of thousands of HP products.
Days later, Big Lots had sold out of the bundles, making money on each bundled unit while pricing the products at more than 30 percent less than the manufacturer's suggested retail price.
"It was an incredibly successful promotion," says Big Lots' Ralph Smith. "We only wish that there had been more product available."
By aligning the interests of its manufacturing and retail partners and providing the services that turn great ideas into profitable reality, New Age has helped to ensure that HP products will be on Big Lots' shelves for a long time to come.
The Write-Off That Never Was
Challenge
Early in 2004, Hewlett-Packard (HP) was faced with the challenge of deciding what to do with 40,000 returned DeskJet printers in one of its warehouses. Priced below $39, the model was one of HP’s low-end units and had recently been discontinued. The large quantity low price point would in most cases make remanufacturing and reselling the untested printers prohibitive, and the company was resigned to the likelihood that it would have to write-off inventory originally valued at over $1.6 million, incurring over $200,000 in disposal costs.
Initiative
With New Age’s strong retail partnerships and incomparably lean operations, account managers are well equipped to create win-win scenarios when faced with such challenges.
New Age's unique business model offers tactical and unrestricted communication between the manufacturer and reseller. Through open dialogue, New Age has been instrumental in placing HP products into multiple sales channels including: national retail, regional retail, military exchanges, wholesale clubs, eBay, office product super stores, catalog/mail order, food & drug and e-commerce, as well as CT VARs and distributors.
In this scenario, HP contacted New Age and the company was quickly able to locate a retailer who was willing to purchase all of the units at a mutually beneficial price point on condition that it received them in time for its President’s Day sale.
Results
New Age realized the efficiencies required for everyone to make a profit by putting its inventory management processes and outsourced repair facilities into high gear, dramatically reducing remanufacturing costs by 25 percent and processing all 40,000 units in less than six weeks.
Thanks to New Age’s responsiveness, relationships and ultra-lean operations, the retailer was able to sell every refurbished printer at a price that guaranteed it a healthy margin, while HP saved almost a million dollars.