Written January 2008
by Cliff Feldwick
Two things strike me about the recent (at least as I write this) announcement that CompUSA is closing all its stores (as opposed to closing some of the less profitable ones last February – we missed that for the Columbia and Towson stores, being as moneyed as we are around here).
First is the low level of interest in the announcement. The only mention in the Washington Post was a small paragraph in the Business Briefs column on page 2 of the Business section. Somehow the demise of a major player in the industry, and one known to about every consumer, should have gotten more attention. Are we just immune to businesses disappearing?
Secondly is the “about time” attitude of many of the postings on the PC World, and similar, websites in response. I wonder if all of the people who had bad experiences there (and there certainly were enough who shared them) have thought about their alternatives.
I may have a different perspective, since I fix my own stuff and never had to deal with a technician there – often a cause of frustration. And I had a dedicated business sales rep, Chris Perry, who treated me well and always tried to give at least a symbolic $5 off for a part for a fellow computer tradesman.
OK, so I’ve actually been paid by people who disliked going there so intensely that they hired me to scout ahead, show them the choices and talk (interpret) with the salesmen. Maybe that was a clue about the average view of the place. But at least we were able to get something that day and go set it up, an often desirable goal. And they did have specials such as external hard drives that were truly special, as well as the ability to go get a part if needed, again today as opposed to mail-order next week.
Some of CompUSA’s troubles were of their own making, of course. Why, for instance, did they go into the large-screen TV market, one where most electronics stores are beating each other to death on pricing on a weekly basis? Got to wonder about that one.
So what now?
Staples, interestingly enough, has started to carry Dell computers and printers – a good thing if they actually carried anything like the full line. Today’s visit showed two laptops, one slimline desktop (not the best choice no matter how sleek it looks – they get too hot and finding replacement parts is a fool’s game) and a few printers. The tech there, who was covered with years-of-service pins and so was probably a good spokeswoman, said they probably would get more after the new year, but they’re never told in advance.
As far as parts and accessories go, most people will now be faced with Best Buy and Circuit City. Tell me they’re any better. As far as service, it seems that the techs there are charged with selling you as many options as possible - many really, really optional.
Circuit City, you may recall, decided last year to fire all the more expensive (i.e., experienced) salespeople and replace them with as-low-wage-as-will-work-there newbies. That philosophy (everyone’s replaceable, and cheaper beats loyalty) is disgusting enough as it is, but at least they got their payback when sales for large ticket items like high-def TV’s plummeted because consumers refused to buy from salespeople who knew squat about their products. And their selection of parts and add-ons is pitiful compared with CompUSA. They too are marginal as far as how long they will survive.
Best Buy has more choices on parts, but if it’s not this month’s (or this week’s) model, forget it. And their outfits – can you imagine “queer eye for the straight guy” doing a segment on the short-sleeve white shirt and thin black tie squad?
And I doubt we’ll see a resurgence of the small “geek shops” that sold their own brand computers before the mass discounters drove them under (although a few still hang in there). Too little margin.
As an aside to that, I note that most places probably make more money on the cable they sell you to hook up the printer than they do on the printer itself. While comparison shopping and weekly specials drive down the printer price, there’s nothing like that on accessories. So a cable that can be bought for $3 to $5 wholesale sells for $15 to $25. Really a rip. There’s another place where CompUSA.com sometimes was valuable. Maybe that part will be bought by someone and survive, but no such plans have been announced.
So what’s to be learned from all this – besides don’t buy the extended store warranty, folks. We should probably expect more shake-outs in an industry marked by low pricing and intense competition from internet suppliers selling at back-of-the-truck prices. And the choices keep getting fewer and less desirable.
Oh, speaking of less desirable, a study by Barracuda Networks showed that 95% of all e-mail in 2007 was spam, up from 70% in 2004 and just 5% in 2001. Enjoy.
Cliff Feldwick is president of Riverside Computer Consultants, and does troubleshooting, network set-ups, data recovery and similar techno-wienie things for small businesses, when not wondering how soon until we have one company left for anything. He can be reached at 410-880-0171 or at cliff@feldwick.com.