D&H Distributing riding green-gadget trend to a profitable year
Harrisburg-based D&H Distributing Co. Inc. has found a growing niche within its wholesale distribution of electronics, gaming consoles, cell phones and other technology.Electronics that use more recycled products in their construction and less electricity to operate are flying out of the warehouses and into stores faster every year, according to the company.
Since January, D&H sold nearly 2 million certified-green products, mostly electronics such as flat-screen televisions, computers and refurbished cell phones. That’s about 22 percent of D&H’s yearly sales totals by volume just for certified-green gadgets, said Jeff Davis, senior vice president of sales.
The company was pushing green products as part of a run-up to Earth Day on April 21, he said.
“We were frankly surprised at how well-received this promotion was among our resellers,” Davis said.
D&H built its billion-dollar distribution business over the past 92 years by staying ahead of the curve on retail trends. It’s looking likely that the new green-items initiative, along with bolstering the number of resellers that will promote them, will help D&H maintain that status.
Companies and industry groups said green products continue to be important for sales figures as businesses and consumers search for ways to save money on electricity and reduce their environmental impact. However, it’s difficult to say how fast the sale of green electronics is expanding, one trade group said.
Many people are buying green more often to have the latest electronics while saving money on their electric bills, said Jennifer Bemisderfer, a spokeswoman for the Arlington, Va.-based Consumer Electronics Association.
Electronics companies are pushing the products, too, she said.
“If you were at the Consumer Electronics Show this year, everywhere you looked you saw green,” Bemisderfer said.
Green can mean energy-efficient products as well as those built with easier-to-recycle parts, more post-consumer recycled plastics and metals, and fewer hazardous materials such as mercury, Bemisderfer said. Top electronics companies such as Sony, Samsung and Casio continue to introduce eco-friendly products and programs to recycle them, she said.
D&H launched a recycling program in January, allowing consumers to register old electronic products on its website and print shipping labels to send them back to manufacturers, Davis said. Many manufacturers offer gift cards to buy new items in exchange for recycled electronics, he said.
Smart-grid technologies, such as programmable thermostats and items with “smart-plugs” or power cords that don’t draw electricity when a gadget is turned off, also are doing well with consumers, Bemisderfer said.
However, buying power shrank during the recession, so consumers and businesses are still looking for deals on electronics, she said.
“In terms of consumers gobbling (green electronics) up, it’s certainly something they’re more interested in,” Bemisderfer said. “But the key purchasing criteria continues to be price; especially in this economy, where everyone wants to save money.”
There are other indications that green is growing in importance to consumers in Central Pennsylvania.
RecoupIT Inc., a Cumberland County-based used computer and electronics reseller, has seen some anecdotal evidence that green is one of the key criteria on people’s minds when they buy electronics, President Peter Sobotta said.
The Silver Spring Township reseller has contracts with large retailers, such as Wal-Mart, to refurbish and sell secondhand computers the store can’t sell, such as returned items.
RecoupIT doesn’t promote or track sales of energy-saving and certified green products on its website, the company’s main sales venue, Sobotta said. But when people are considering large, high-definition televisions, energy usage often convinces them to go with one model over another, he said.
For example, a plasma-screen TV uses about twice as much energy as a liquid crystal display or LCD TV, Sobotta said. That has convinced many people to buy LCDs rather than plasma models, he said.
Green purchasing was not immune from the recession, but electronics performed better than other sectors, according to a March 25 “Green Living” report from Chicago-based research and marketing firm Mintel.
Green electronics showed growth potential over the past two years, according to Mintel. In 2008, 13 percent of respondents said they considered green factors in their last electronics purchase and 50 percent said they would consider them in their next purchase. In 2009, those numbers increased to 17 percent and 53 percent respectively.
It also found that the market for all green products grew by 41 percent, from $511 billion in 2004 to $723 billion in 2008. Last year was flat because of the recession, but this year the green market is projected to grow by about 2 percent, according to Mintel.
Market growth for green products isn’t a big surprise to D&H anymore, Davis said. Sales of green electronics took off four years ago and grew steadily.
“We realized then that we had to focus more on green products,” he said.