[TriLUG] CompUSA from the POV of the NY Times' David Pogue

[tomed at bellsouth.net]

1. From the Desk of David Pogue: The Gutting of CompUSA
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Did you hear? In the next couple of months, CompUSA will be 
closing over half of its 225 stores. 

You can find a list of the doomed stores here 
(http://www.compusa.com/locations/closing_stores.asp), if 
you're interested.

But something tells me that if anyone were actually 
interested, those stores wouldn't be closing.

This may sound a little harsh--but frankly, I've never quite 
understood how CompUSA stayed in business to begin with. Most 
of the stores I've visited have been sterile and soulless, 
and pervaded by a feeling of abandonment. You'd think a 
gearhead like me would get all excited to be there, but for 
some reason, I just can't wait to get out.

Here's the official reason the chain is shuttering 128 
stores, as it appears in a statement by Roman Ross, CompUSA's 
CEO: "Based on changing conditions in the consumer retail 
electronics markets, the company identified the need to close 
and sell stores with low performance or nonstrategic, old 
store layouts and locations faced with market saturation."

Well, whatever.

I think the real culprit behind the gutting of CompUSA is 
Internet pricing. You can order computers, accessories and 
electronics from the Web for a fraction of CompUSA's in-store 
prices--and evidently, most people are doing exactly that. 
(It's not just CompUSA, by the way. Circuit City is closing 
70 stores, too. And don't forget the 30-year-old Good Guys 
chain--46 electronics stores in California--which CompUSA 
bought in 2003 and then closed in 2005.)

Even among retail shops, though, I've found CompUSA to be 
overpriced. One day last year, I stopped in to a CompUSA to 
buy an Ethernet cable; the least expensive one they had was 
$25. I found a $6 cable next door--at a Home Depot.
But what about the old argument that local shops offer hand-
holding, friendly advice and personal service?

Well, there may be CompUSA employees who provide all that. 
But I haven't met many of them.

In 1999, I wrote an article about CompUSA for a computer 
magazine. I visited CompUSA stores in five states, posing as 
a computer novice and asking questions. I tallied up some of 
the ridiculously misinformed remarks made by the CompUSA 
sales staff. My favorite: "That computer doesn't have a level 
cache." (I believe he meant a Level 2 cache, but what the 
heck--maybe the thing really was a little tilted.)

The company's corporate spokesperson at the time 
acknowledged, "Getting staff is a problem across the board. 
We need specialized talent; finding it can be a challenge." 
Between her lines, you could read the truth: technology 
experts are in demand everywhere. At $6.50 an hour (what 
CompUSA was paying at the time), you're not going to attract 
many people who, ahem, excel in both personal and technical 
skills.

It's really a shame that CompUSA managed to fritter away its 
ubiquity and name-brand advantages. Despite the Internet's 
price pressure, there's a crying need for local computer 
stores; the average person's sense of technological 
helplessness is growing these days, not shrinking. 

Besides, Internet or no, it's not impossible to create a 
successful computer chain. I've never been to a Fry's 
computer store--it's a regional chain with no stores in my 
region--but it has armies of loyal fans.

Maybe a corporate analyst can say what's wrong with CompUSA's 
business model from a spreadsheet standpoint. But it 
shouldn't take an MBA to spot the greater problems; just 
checking out these forlorn warehouses and sullen salespeople 
ought to make the problems perfectly clear.

Even now, as over half of the stores prepare to shut down, 
CompUSA misses an opportunity to be customer-friendly. Its 
final offer isn't much of a fire sale: 10 percent off 
everything in the shuttered store--and no returns.
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Copyright 2007 The New York Times Company