PHILIPE E. DELGADO JR. : President, Phil & Jim’s TV & Appliance
Philipe E. Delgado Jr. grew up in the appliance business. As the son of the co-founder of Phil and Jim’s TV & Appliance, he was prowling the sales floor as a lad when the company was based in South Gate. Today, the chain is based in Anaheim and has grown to 12 stores, all in Southern California, with 306 employees. Delgado, a 41-year-old father of six, had already developed a metal finishing business in Orange when he took control of the family business this year. He recently spoke with Times staff writer Chris Woodyard.
Q. How important is price in the appliance business?
A. The prices in this industry have not changed in many years. You can buy a washer, dryer or a refrigerator today for literally the same price you were paying for it 15 years ago.
Q. So service becomes an important factor?
A. Everybody does some form of service. We run somewhere between 4,000 and 5,000 service calls a month. And they are not only our sales. We pick up a tremendous amount of service on our competitors’ product, which we welcome. It gives us a chance to prove ourselves to them.
In this market there are three factors of impression. Your first impression is your salesperson. So hopefully the impression of the salesperson is one of knowledge, one of credibility, and of service. Your second impression is your delivery crew. We make sure that our delivery crews say, “Thank you for shopping at Phil & Jim’s. We appreciate your business. If you have any questions please call this number on your (payment) envelope.” Our third impression, if necessary, is our service representative.
Q. Are today’s appliances lasting longer?
A. Appliances nowadays are far more energy-efficient. They last, I believe from personal use, as long as they ever have. The only disadvantage now is in California you have three colors: black, almond or white. There are no other colors.
Q. Have appliance manufacturers missed the boat by not realizing the importance of fashion when marketing appliances?
A. No they’ve tried fashion marketing, and they have found that they’ve shot themselves in the foot.
Q. What kinds of items are popular for the holiday shopping season?
A. We have seen a tremendous number of female buyers come in and buy their husband that (big-screen) direct-view television. It is a very common gift among husbands and wives, or boyfriends and girlfriends.
Q. Because men are perceived as big sports watchers?
A. Exactly. And you will be amazed at how many men will come in before a sporting event and say, “I want that big screen” or “I want that direct-view” TV. It’s incredible.
Q. Are buyers holding off from making major purchases like a big-screen television until prices come down?
A. Prices have come down on big screens, substantially. I am assuming that the manufacturers have learned how to build them better; to be more cost-efficient.
Q. What are dealers doing to operate more efficiently in the recession? How have you cut your costs?
A. I have reduced our operation costs in excess of $3 million. We have taken all the frills out. A lot of things that we took for granted aren’t there any more. The recession--along with a very competitive market with some price erosion--has taught us. We have gotten more efficient in inventory expense, in truck expense, in insurance expense, in maintenance. It’s just a matter of sitting down, lining up your priorities and reducing your costs.
Q. Aren’t appliances a difficult retail segment to be in during a recession, because consumers look upon them as being durable and tend to make repairs instead of buying new ones?
A. We’ve seen service calls go up. People fixing old merchandise hopefully trying to get away for a $40 or $50 bill instead of spending $300-$400 on a new washer.
Q. What’s the trend right now in appliances? What’s new?
A. Energy-efficiency. There is an Edison program that gives customers rebates of $50 or $100 if they buy energy-efficient refrigerators. There’s a tremendous concern with how efficient your refrigerator is, or how efficient clothes or dishwashers are with regard to water.
Q. Do you expect a shakeout among retailers?
A. I think that shakeout has already started. Look at RogerSound Labs. One of the most gorgeous operations I had ever seen. I mean I used to walk into a RogerSoundlab and think, “Gosh wouldn’t this be nice.” They’re gone.
Q. Do you think that Circuit City will continue to be as strong as it has?
A. I believe Circuit City will be a predominant force in the market. Circuit City, years and years ago, were concessions in Zody’s stores. Nobody took them seriously and look where that got ‘em.
Q. Is the Southern California market unique?
A. I believe Southern California is a different market. I’ve been to a lot of places, and I believe Southern Californians sets themselves aside in their trends--what they like, what they buy.
Q. You know you’re dealing with so many different suppliers, I mean they’re all trying to get a leg up on each other in the show room.
A. We dealers all want the same thing. We want to move the numbers. And the manufacturers want to move the numbers. They’d like us to move even more than we do but we can only do so much.
On the appeal of Orange County to retailers.
“I don’t know the exact statistics, but if Orange County was a nation, wouldn’t we be one of the richest nations in the world?”
On specialization.
“I think there’s still very much room for a general (appliance) dealer.”
On the need for promotion.
“We do whatever we can to promote this business. And this is a tough business. There’s nothing easy about it.”
On clutter in advertising.
“Some ads are so full of material. Do you want to read a book or do you want to buy an appliance?”
On customer loyalty.
“We have learned that we need to constantly strive to keep customer loyalty. We do everything that we can to make sure that our customers are satisfied.”
