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Changing with the Times Can Be Good for Business


A decline in business typically is never good.  But for one family-owned company, a downturn in business proved to be a blessing in disguise.

For 23 years, Distribution Video & Audio built its reputation as the nation’s largest closeout buyer in the home entertainment industry, specializing in compact discs and DVD sales.

While such sales have been dropping for years, DVA President Ryan Kugler said it was in the last year that the downturn really began hurting his business.

In the end, it cost the company millions of dollars and some employees their jobs, yet Kugler said that drastic decline in business also was the impetus for much-needed change.

DVA was forced to adjust to the times, Kugler said, when the music and movie industries both made moves away from compact discs and videos to Internet downloads.

“We were so closed-minded,” Kugler said.  “Basically, we needed to think outside the box.”

For the Burbank, Calif.-based business, that meant straying from their comfort zone of music, movies and games and adding other items like TVs, iPods, toaster ovens and other small electronics to its product line.

“I thought, ‘Why am I not doing this with other products, especially in this time when our sales went from $20 to $16 million?’ ” Kugler said of their decision to broaden DVA's product line.

DVA buys and sells excess inventory and closeouts from retailers , manufactures, wholesalers, and distributors across the nation. The products are then resold to one of their more than 4,000 clients, which include truck stops, flee markets and online retailers.

“Some people call us a liquidator; I like to call ourselves a secondary wholesaler,” Kugler said. “We find a home for unwanted, non-selling products.”

Kugler said it was necessary for DVA to start selling additional products like digital frames, clothing, even aviation parts after realizing that one-time hot- selling compact discs were becoming obscure in an age when downloaded music accounts for 65 percent of the industry. With movies heading in the same direction, making a change in business was critical.

“We did this to expand our business and make up for the loss of CD sales,” Kugler said. “The process was simple; we just added these items to our business model , as buying and selling a widget is the same as another widget.”

Kugler said the change has definitely paid off, increasing the company’s sales by $5 million in less than a year, and said it demonstrates that successful businesses can’t be afraid to change things up.

The hardest part, Kugler said, is actually deciding to make the change. He suggests reading self-help books that discuss taking risks and making changes.

“That will help motivate you,” he said.

Kugler also said making a commitment to the change is also critical.

“Don’t just give up on it,” he said. “We went through six months of hell to reap six great months.”

Chad Brooks

Chad Brooks is a Chicago-based freelance writer who has nearly 15 years experience in the media business. A graduate of Indiana University, he spent nearly a decade as a staff reporter for the Daily Herald in suburban Chicago, covering a wide array of topics including, local and state government, crime, the legal system and education. Following his years at the newspaper Chad worked in public relations, helping promote small businesses throughout the U.S. Follow him on Twitter.