Campo Electronics, Appliances & Computers, Inc.

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Campo Electronics, Appliances & Computers, Inc.

109 Northpark Boulevard
Fifth Floor
Covington, Louisiana 70433
U.S.A.
(504) 867-5000
Fax: (504) 867-5001

Public Company
Incorporated: 1972 as Giant TC, Inc.
Employees: 890
Sales: $294.62 million (1995)
Stock Exchanges: NASDAQ
SICs: 5731 Radio, Television & Electronics Stores; 5722 Household Appliance Stores

Campo Electronics, Appliances & Computers, Inc. is one of the most successful and fastest growing regional electronics and household appliance retailers in the United States. With headquarters in Covington, Louisiana, the company sells brand name consumer electronics equipment, major appliances, and home office technology in 31 stores across six states, including Louisiana, Texas, Mississippi, Alabama, Florida, and Tennessee. The company has a long history of selling its products in small and mid-sized towns across the Deep South and is beginning to compete with such large and well-established national retail chains as Sears & Roebuck, Circuit City, and Silo Electronics. From 1993 to 1995, Campo Electronics expanded from 22 to 31 stores, and net sales increased a whopping 189 percent, one of the most impressive returns ever recorded by a regional appliance and electronics retail company.

Early History

The driving force behind Campo Electronics and the reason for its success is Anthony Campo, Jr., the president and chief executive officer of the company. Yet the firm started long before he was born. In 1927, Anthony’s paternal grandfather, Anthony Campo, Sr., opened a general store in Harahan, Louisiana. During the late 1920s, the store sold dry goods and hardware to a small but loyal clientele from the rural areas surrounding the town, and sales remained just high enough to stay in business.

When the Great Depression swept across the United States after the stock market crash on Wall Street in the autumn of 1929, businesses throughout the country were threatened by financial hardship. Many firms and companies were forced into bankruptcy. Nowhere was this more evident than in the southern part of the United States, where severe drought during the early 1930s exacerbated the financial problems of the general populace. Retail stores were particularly hard hit, due to the impoverishment of many farming communities. General dry goods stores like the one owned by Anthony Campo, Sr. were able to scrape out a meager existence only by extending generous terms of credit to farmers and townspeople. It wasn’t until the start of World War II that the economy of the Deep South began to improve, and the continued existence of the Campo general store became less precarious.

The World War II Years

The advent of World War II dramatically altered the U.S. national economy, and with it the fortunes of retail stores across the country. As people returned to work in both the industrial and agricultural sectors of the economy, individuals had more purchasing power, and the Campo general store began to see an improvement in its financial status. Dry goods such as sewing materials were bought at premium prices by women making clothes for their families. Farmers, no longer constrained by their limited financial resources due to the government’s encouragement and assistance in growing produce for U.S. service personnel, frequented the Campo general store with regularity, and purchased needed tools and small hardware items to keep their farms at maximum capacity. By the end of the war, the Campo general store was selling more hardware items such as nails, wrenches, hammers, and mechanical lubricants than at any previous time.

The Postwar Period

During the late 1940s, and throughout the 1950s, the Campo general store was completely transformed by the postwar housing boom. As soldiers returned from overseas to marry their sweethearts, one of their most important goals was to settle down in a new house and raise a family. The GI Bill passed by Congress provided many veterans with the funds needed to finance a mortgage on a new house. Along with this increase in construction came the accompanying desire by many men to engage in home improvements of their own, and consequently there was a dramatic increase in demand for tools, nails, lumber, pipes, saws, and thousands of hardware items. The Campo general store did away with most of its dry goods merchandise and began to stock more hardware items. As demand continued to grow, the store responded by discontinuing all items except hardware supplies.

By the early 1960s, however, the housing boom in the United States had significantly slowed down. Businesses that had formerly thrived by providing supplies for the construction and housing industry began to feel the effects of the downturn in new home building. The Campo hardware store was also affected. Although farmers and rural communities still purchased hardware items from the store, sales crept lower and lower. Yet at the same time, there was a growing interest in consumer appliances and household electronic items such as radios, toasters, televisions, and record players.

Anthony Campo, Sr., although having grown older, was still an astute and enterprising businessman. He realized that the era of the general hardware store was quickly coming to its end and decided that more money could be made selling electronic appliances than selling nails and hammers. As a result, he closed his hardware store and opened the first Campo electronics store on the same site in 1967.

Transition in the 1970s

Campo Appliance Company was successful from the day its doors opened for business. Selling such household appliance items as hi-fi stereos and electric mixers, the company made a name for itself in the area surrounding Harahan and in other small towns in the region. Anthony Campo, the son of Anthony Campo, Sr., inherited the store from his father and continued to emphasize the friendly customer service that had been a trademark of the business since the late 1920s. In 1972, in order to distinguish the company as an appliance retail store, and remove any lingering confusion with the general hardware business, Campo decided to change the name from Campo Appliance Company to Giant TC, Inc.

As the store continued to expand, and sales increased during the early and mid-1970s, a new family member joined the business. Anthony Campo, Jr. was cut from the same mold as his grandfather. Ambitious, headstrong, and impatient, but an astute businessman with a gift for recognizing trends within the electronics and retailing industries, Anthony Jr. graduated from high school with the intention of attending college in order to fulfill the requirements for a degree in business administration. Yet the young Campo became disenchanted with the prospect of having to take prerequisites in mathematics and biology before attending business courses. He changed schools four times before he ultimately dropped out, frustrated with what he thought were unnecessary obstacles to learning about business.

In 1975, the young Campo began working at his father’s store as a salesman. Working his way from the ground up, Campo devoted six days a week to the family business. Campo not only worked in sales, but in marketing, personnel, operations, and finally management. By 1984, he had risen to the position of senior vice-president of the company and, in anticipation of what was to become one of his trademarks as an entrepreneur, immediately implemented an expansion program for his family’s business. In 1985, under his direct supervision, the company purchased three Sound Trek stores, thus making a commitment to enter the burgeoning home stereo and car audio equipment market. Around the same time, Campo opened Mobile One, a cellular telephone dealership. By 1991, Anthony Campo, Jr. had succeeded his father as president and chairman of the board of directors, and in 1992 also assumed the title of chief executive officer. At the end of 1991, the new president and CEO thought a name change was appropriate, so he discarded the old name in favor of Campo Electronics, Appliances, and Computers, Inc.

Acquisition, Expansion, and Innovation in the 1990s

One of the first moves Anthony Campo, Jr., made after succeeding his father, was to build upon what he had already conceived of and implemented—an unparalleled acquisitions and expansion policy. Almost immediately, Campo opened store after store across Louisiana and Mississippi. By the end of 1992, the company had grown from one store to a 13-store chain retailer, and sales had shot up to just under $75 million. During this time, Campo acquired Shreveport Refrigeration, a large, well-known consumer electronics retailer which operated nine “superstores” in northern Louisiana and northeastern Texas. For the fiscal year of 1992, Shreveport Refrigeration reported total sales of over $40 million. By the end of fiscal 1993, net sales for Campo Electronics had jumped to $101 million.

According to industry analysts, much of the success of Campo Electronics was due to the young president’s innovative idea of a “concept” store. The “concept” store format became the model for all subsequent Campo stores and allowed customers to select from a broad range of consumer electronics, appliances, and home office products, including state-of-the-art computer technology. In the area of television and video, such brand names as GE, Magnavox, RCA, Samsung, Sony, and Zenith lined the stores’ shelves, while in computer and home product items such brand names as Apple, Brother, Canon, Compaq, IBM, Packard Bell, and Panasonic were part of each store’s floor stock. Each “concept” store was designed in such a way as to enable the customer to explore features of the products through hands-on displays. The design of the “concept” store is bright and open, almost glitzy, and contains 18,000 to 30,000 square feet of space.

One of the most successful aspects of the “concept” store has been to place a wide assortment of personal electronics products and items such as telephones, portable radios, and camcorders in the center of the floor in order to encourage impulse buying. This strategy has made personal electronics products the largest selling items in all of the company’s stores. Another important aspect of the Campo “concept” store is to hire superb salespeople and train them to provide excellent customer service. It is the policy of Campo Electronics to require that each salesperson participate in a two-week training program when first hired, and to take part later in ongoing training seminars that keep them abreast of the latest developments in consumer electronics and appliances technology. Perhaps the most significant part of the success of the “concept” store has involved the ability of management to place each of the stores in high visibility locations such as strip shopping centers and free-standing formats to take advantage of major automotive thoroughfares.

Marketing has also played a large role in increasing sales at Campo “concept” stores. During the early 1990s, the company issued its own private label credit card to encourage repeat business and cultivate long-term relationships with customers. By the end of fiscal 1995, approximately 284,000 customers were holders of a Campo credit card, and 34 percent of all net sales involved purchases with these cards.

The Mid-1990s and Beyond

By 1994, net sales for the company increased to over $194 million, and by the end of fiscal 1995 net sales had jumped to over $294 million. Much of the company’s financial success is due to management’s determination to develop and maintain a strong position in the electronics retail industry across the Mississippi Gulf Coast region. Focusing on small to medium-sized metropolitan markets, rather than on major cities, Campo Electronics has carved out a niche that is threatening the market share of such larger and better known national chain retailers as Sears, Circuit City, and Silo. The company opened 14 new stores in fiscal 1995 alone, in places such as Birmingham, Dothan, Huntsville, and Mobile, Alabama, Hattiesburg, Mississippi, Panama City and Pensacola, Florida, and Memphis and Chattanooga, Tennessee. These new openings brought the number of Campo stores to a total of 31 operating in six states, including Louisiana, Texas, Mississippi, Alabama, Tennessee, and Florida.

At the end of fiscal 1995, Anthony Campo, Jr. decided to temporarily halt the rapid expansion strategy of the early and mid-1990s in order to consolidate the company’s gains and prepare for a new round of acquisition and expansion in the near future. Campo Electronics continues to attract new customers with its “concept” stores, and sales are increasing at a record pace. In less than five years, under the direction of a dynamic and visionary president, the company has grown from a one-store operation to a regional powerhouse in electronics retailing across the Deep South.