Wireless retailing like marriage: Some years are good, some aren’t

Regional wireless retailer Wireless Zone has announced an ambitious plan to expand its 275 locations to a total of 400, in 400 business days.
Wireless Zone CEO Kevin Sinclai, said that if the company isn’t growing, it’s losing its value to its partners and the carrier whose products it sells-in this case, Verizon Wireless. Wireless Zone has locations located throughout the East and mid-Atlantic U.S., and plans to expand aggressively into the Midwest. Targeted states include Michigan, Ohio, Indiana and Illinois, with plans to expand its presence in Florida and the Northeast.
The franchise business has been around since 1988 (previously known as The Care Phone Store), and Sinclair has been involved in the wireless industry since 1983. He was president and COO of Wireless Zone for several years and recently was appointed CEO.
Sinclair said he believes the company’s strength is its “ability to change when the industry changes, which most agents have not been able to do.”
Over the years, he said, agents have come and gone as the industry has changed: first from an analog business, where phones could be easily “flipped” from one carrier to another, to digital, with conflicting GSM and CDMA technologies. Now, cellphones reach a massive customer base and have a wide array of models and accessories. Agents who were used to an essentially voice-only business are facing the requirement to become ever more tech-savvy as data services increase in importance. “As a dealer, if you don’t change with the needs of the carriers, there’s no longer a place for you, so you get replaced-and that’s just a fact of life,” said Sinclair.
He said that he uses Verizon Wireless’ GPS navigation service, VZ Navigator, as he travels between stores and told his franchisees at a kick-off meeting last weekend that “if they’re not all downloading music and using the technology we’re selling, they should get out of the business.”
“The greatest challenge is realizing the value of what the technology does today, versus what it did four years ago-and second to realizing what it does, actually using it so they can explain it to a customer,” Sinclair said.
Other facts of life for dealers, he said, are that carriers sometimes open up their own retail locations close to pre-existing agent stores; that carriers want to drive traffic into their own channels to assert greater control of the customer, and that a dealer basically exists to sell customers to the carriers. On the other hand, he said, dealers have connections to a local community that national carriers typically do not, and can be creative about developing a business in locations that carriers bypass. They have the ability to respond nimbly and make price changes based on market demands and offers from the carrier stores, which have to deal with greater bureaucracy-but, he added, it means the constant work of checking the carrier Web sites and shopping other local stores to see what’s out there.
Sinclair compares the dealer/carrier relationship to a marriage. “If you abide by your end of the contract and your wife abides by her end, you generally have a great relationship. And if you’re married for 50 years, there are years that are awesome and there are years where you question yourself,” he said. But, he added, “If it weren’t for the carriers, none of us would have a business.”