Retail is in some people's blood; and so is a passion for technology and entertainment. That's clearly the case with Trevor Wong and Stacey Sniderman, the husband-and-wife team behind Update TV & Stereo Ltd., a three-store chain in York Region, north of Toronto.
"Sniderman" is a legendary surname in Canadian retail: the late Sam Sniderman was the man behind Sam the Record Man, the iconic Canadian music chain. He was also Stacey's great-great uncle. Sam the Record Man passed away in 2012, one year after Stacey and Trevor bought Update TV & Stereo. Previously, she worked for Toys"R"Us (Canada) Ltd. in store planning, and before that for Sony of Canada Ltd. as a merchandiser.
Retail is in Wong's DNA as well. In fact, he tried to get away from CE retailing, but it kept pulling him back. Wong worked for The Sony Store from 1993 to 2006. Sniderman proudly says he was the chain's "top sales guy" for Ontario, and "one of their best managers." He left in 2006 to pursue a degree in finance, after which he worked for Scotiabank. But it wasn't a comfortable fit. "Trevor couldn't just work a nine-to-five job," Sniderman says. "Banking wasn't for him."
Stacey Sniderman, CFO and Vice President, Update TV & Stereo, Richmond Hill, ON: "You have to have something to delight the customer. At every store, we have one piece for creating the wow factor."
As it happened, the couple already had a foot back in retail. Wong had known Dan Ngo, then the owner of Update TV & Stereo Sales & Repair Ltd., for several years. Ngo was in the process of reinventing his business. Founded in 1992, Update had two locations, both catering to Toronto's Chinese community. One was on Spadina Ave. in the heart of Toronto's downtown Chinatown, the other in a heavily Chinese area of Scarborough, in northeast Toronto.
Both were small stores, in buildings that Ngo owned. In addition to flat panels, they stocked mounts and stands, plus Chinese movies and Karaoke discs. By the mid-naughts, that business model had become less viable. TVs had become bigger, and Update's 500-square-foot stores didn't have enough space to display them properly. Not only that, prices and margins had shrunk, and Update needed a broader product assortment with opportunities for greater profit. Home theatre and audio were obvious candidates, but that required a larger-footprint store.
Ngo turned to Sniderman and Wong to build it for him. That location, in Elgin Mills Crossing, a busy power centre in Richmond Hill, ON, was the first Update store in leased premises. The 1,500-square-foot store opened in 2010. But by that time, Ngo was looking to exit the business, and offered to sell the operation to Wong and Sniderman. They signed the deal in 2011.
THREE NEW STORES
Four year later, the two original Update TV & Stereo stores are closed. The company now has three locations, all in York Region.
The Elgin Mills Crossing location, which Sniderman calls "our cash cow store," has a large open area at the front, containing flat panels, audio components and a counter with portables and accessories; and an enclosed soundroom at the back.
The chain's key brands include Samsung and Sony televisions, and Monitor Audio and Focal loudspeakers. Those lines are well represented at Elgin Mills Crossing. There is also a good assortment of AV receivers from major brands like Denon, Pioneer Elite and Yamaha. And the store shows a broad selection of AV furniture from BDI.
A year after buying Update TV & Stereo, Wong and Sniderman opened their second location, in the Village at Vaughan Mills. Located in the western part of York Region, the Village at Vaughan Mills has a high concentration of furniture and design stores. So appropriately, the focus of Update TV & Stereo's Vaughan store is custom integration and home automation. "We do a lot of Control4 systems," Sniderman says, noting that Trevor Wong recently supervised the installation of a $250,000 system in Jamaica.
In the spring of 2014, Update TV & Stereo opened its most ambitious store yet. Update Elevated is located in a converted church on Main St. in the old village of Unionville, in Markham, ON, in the eastern part of York Region. Main St. is a popular local attraction, with a large concentration of trendy boutiques and cafés catering to the heavy pedestrian traffic.
On May 8, Stacey Sniderman and Trevor Wong hosted 400 guests at a party to celebrate the first anniversary of Update Elevated, their high-end audio-video store in a converted 19th -century church in the historic village of Unionville, ON (shown at top of story).
Completed in 1874, the building served as a church until 1925, and after that as a veterans' hall. The Old Unionville Church was designed by Edward James Lennox early in his career. Lennox went on to design Toronto's Old City Hall, the King Edward Hotel and Casa Loma.
The building is now owned by a friend of Sniderman's and Wong's, who suggested to them that they consider it as a retail location. "We wanted to create a major wow factor," Sniderman relates, "so we decided to create a luxe Update TV & Stereo."
THE WOW FACTOR
The 3,000-square-foot Update Elevated store is one of the most striking retail spaces I've ever seen; yet it's not at all intimidating. The front of the store has a soaring vaulted ceiling. It's the opposite of a stereotypical dark, solemn church interior. The main room is airy, open and inviting. Even though it has houses a huge selection of serious high-end componentry, there's no sense that these are religious artifacts placed on altars, and not to be seen (or heard) by the uninitiated.
Toward the back of the store are three demo rooms. One houses a system consisting of MBL C116F floor-standing speakers, MBL 1621A CD player, ModWright Signature KWA150 power amp, ModWright LS 36.5 line-stage tube preamp, Torus AVR20 power conditioner and Siltech cabling, with total value of $100,000. In another, there's a Sony 4K projector, Theta Digital Dolby Atmos processor, and Monitor Audio Platinum in-wall and in-ceiling speakers.
In one of the soundrooms at Update Elevated, visitors can experience a $100,000 system consisting of MBL speakers and CD player, ModWright pre and power amp, and Siltech cabling.
That's just the start. If you want to hear KEF Blades or MartinLogan Summits driven by a Bryston 4BSST2 power amp, you've come to the right place. Ditto if you want to hear a vinyl playback system based on a Clearaudio or Rega turntable. It's not all ultra-high-end: affordable systems with KEF, Monitor Audio and Focal speakers are available for demo in the main showroom; and there are home-theatre systems built around Pioneer Elite, Marantz and Yamaha AVRs. In other words, the place is an AV enthusiast's paradise.
Sniderman says the store makes it a point of having the product playing music and movies when people come in. "In most places, when people go into the store, everything is shut off," she says.
Update TV & Stereo is an authorized dealer for all its brands; and it's the only Canadian dealer for Germany-based MBL. That big MBL system may create a wow factor for Elevated customers. After all, how many people get to hear a $100,000 system without having to petition an audio high priest for an audition?
But a big system like this isn't for everybody, even those who can afford it. So the chain creates different kinds of experiences at different locations. "You have to have something to delight the customer," Sniderman says. "At every store, we have one piece for creating the wow factor." At Elgin Mills Crossing, Update TV & Stereo uses a Sonos system for that purpose. "Most people have never realized that wireless music can be so easy," she observes.
THE THREE PILLARS
A striking aspect of Update TV & Stereo is that its locations are all different. With most chains, stores tend to be clones of one another. This is a deliberate strategy, Sniderman says.
She outlines three "pillars" - key product segments - for the chain: flat-panel TV and home theatre; premium two-channel audio; and home automation and wireless music. While there's clearly a fair bit of cross-fertilization among the three stores, each branch has its area of specialization.
Elgin Mills Crossing is the most generalist, but has a heavy focus on flat-panel TV and home theatre. For Vaughan Mills, the main focus is custom integration. For Unionville, it's serious two-channel sound, plus high-end home theatre. The culture and sales process are different in that store, Sniderman notes. "It's a completely different clientele. Everything is slower paced."
The stores are all within a 20km radius, in a community that's quite car-oriented (so people don't mind driving). When appropriate, Update will send a customer to another location. "That's how we keep them buying within our chain," Sniderman says. "When someone wants higher-end product, they'll end up getting Elevated."
Panels still account for 40 to 50% of Update's sales; and most customer relationships begin with someone looking for a new TV. "That's the first intersection for most of our business," Sniderman says. Interestingly for a category that's heavily price-driven, Update TV takes a service-heavy approach to the flat-panel business. "We want to know if the customer is a videophile who watches in film mode or a daytime viewer who watches in torch mode," Sniderman elaborates. "We often do a site survey. As soon as we do that, everything else follows. If they're landscaping, they may need outdoor speakers. If they're renovating, they may need home automation."
And of course, a TV sale often leads to home theatre. "Our typical basement theatre ranges from $25,000 to $30,000," Sniderman says.
In the main showroom of Update Elevated, visitors can listen to KEF Blades and MartinLogan Summits, driven by Bryston electronics; or watch 4K video on an 84" Sony Ultra High Definition television. The store also has more affordable systems, featuring speakers from Focal, KEF and Monitor Audio.
Two audio categories, on seemingly opposite ends of the spectrum, are generating a lot of interest at Update: wireless music streaming and turntables. It's not just boomers and audiophiles who are getting into vinyl. "It's attracting a younger and an older demographic," Sniderman says.
As to wireless streaming, this appeals to a wide range of buyers, including a 10-year-old boy who recently came to Update's Elgin Mills Crossing store, looking for a digital music system. Tired of hearing low-fi music from his son's room, the boy's father gave him a budget of $1,000 for real hi-fi system. The lad spent months painstakingly researching and auditioning. With Sniderman's help, he opted for the AirPlay-equipped Monitor Audio AirStream A100 integrated amplifier, matched to a pair of Monitor Audio Radius 90 bookshelf speakers. "That's what we're here to do," Sniderman says. "This is our next generation of customers."
GROWTH CURVE
Sniderman says this kind of close customer service is a big reason for the company's success. Close to 85% of Update's sales come from referrals. Notes Sniderman: "The best marketing happens when someone visits a friend, and asks, ‘Who did this for you?'"
In an era when some high-profile retailers are shrinking or closing, Update is growing. Sniderman says Update has had double-digit same-store growth since she and Wong bought the company. Through the first half of 2015, a tough year for CE retail by all accounts, the company is enjoying year-over-year growth of better than 25%, she says. It helps that the chain's business area in York Region is economically prosperous, with a growing population. "People are doing a lot of renovating, so we're changing out a lot of systems," Sniderman elaborates.
Even so, the company is reining in expansion plans. "Our original goal was to open a store every year," Sniderman explains. "This year, with the falling Canadian dollar and price increases, and with some major retail closures, we're taking a step back. We want to spend this year establishing our brand."
For the first couple of years after buying the company, Wong and Sniderman were the only employees. Now there are five people working in of the Elgin Mills Crossing location, two more each in Unionville and Vaughan Mills, three installers, and a delivery person. "Staffing is always the most challenging part of retail," Sniderman says. "We're looking for cream of the crop."
One way that Update attracts and retains staff is a high degree of input, Sniderman continues. "We want to operate more like a family business. It's a give-and-take relationship. Everybody has a part to play in the business."
That sounds like a reflection of the way Wong and Sniderman approach customer relationships. Sniderman says she wants Update TV & Stereo to feel like a family business to both staff and customers.
"We want customers just to come in and visit," Sniderman elaborates. "But at the same time, we're trying to bring a more disciplined approach to the business, so we can expand. The CE business is not what it used to be. It's a lot harder, with a lot more competition. Margins are slimmer."
To deal with these challenges, the company has systems that let it stay on top of financials. "I can tell you our budgeted profit, and how far we are ahead of our budget," Sniderman elaborates. "We watch all of it, including high-profit areas like add-on accessories, cabling and calibration. There are dollars to be made, but you have to think outside of the box. You can't sit and wait for people to walk in the door."