ROANOKE TIMES
Copyright (c) 1996, Roanoke Times
DATE: Friday, May 24, 1996 TAG: 9605240050
SECTION: BUSINESS PAGE: B-8 EDITION: METRO
SOURCE: MEGAN SCHNABEL STAFF WRITER
LIKE MOM-AND-POP stores across the country, the local electronics retailer found it hard to fight the big guys.
After years of struggling to survive as a hometown appliance store in a market dominated by electronics supercenters, Roanoke-based Holdren's Inc. said Thursday it has been purchased by a North Carolina investor.
Both parties have signed the $2.3 million contract and notification of the sale has been sent to Holdren's creditors, but the new owner wants to remain unnamed until all assets have been transferred, said Stan Cross, Holdren's president. The process should take a week or two. The investor has incorporated in North Carolina under the name Holdren's of Virginia Inc.
Holdren's customers likely won't notice much of a change in the chain's five Southwest Virginia stores, all of which will keep the Holdren's name and employees, Cross said. The owner may diversify the chain's inventory in the future but for now will focus on expanding its selection of home electronics and appliances, he said.
The new owner is "very diversified," Cross said. The investor owns several retail businesses, including Crenshaw TV &Appliance Co., a five-store chain in Raleigh, and several Ed Kelly's electronics stores in the Greensboro/Winston-Salem market.
Holdren's began negotiating with the investor in January, Cross said.
"We are very undercapitalized," he said. "We knew that to be able to compete with our competitors, most of whom are stock-market funded, would be almost impossible without tremendous financial backing."
Holdren's, which must fight for market share against volume-buying giants such as Circuit City Stores and Wal-Mart Stores, reported a net loss of $1 million on sales of $14 million for its fiscal year ended March 31 and a loss of $1.1 million on sales of $18.5 million for the prior fiscal year.
"Small mom-and-pop consumer electronics retailers are being pushed out by the superstores," said Kenneth Gassman, a retail analyst with Davenport & Co. of Virginia in Richmond. A typical Circuit City store may do $20 million in sales a year, he said; local chains such as Holdren's are hard-pressed to compete.
"The industry that we're in is brutal, across the whole country," Cross said. "A lot of companies like us are having the same struggles."
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