Computer retail landscape continues to shift as CompUSA shuts stores

by Linnea Kirgan, December 13th, 2007, 6:18 am

Consumers looking for a one-stop shop for all things computers will now have one fewer option. The struggling CompUSA retail chain announced last week that it would close or sell all 103 of its US locations. Earlier this year, the company closed an additional 100 stores, with plans to focus on less competitive markets and sell to small businesses and tech savvy consumers.

CompUSA’s TechPro unit, whose technicians handle repairs and upgrades, and the CompUSA Web site will continue to operate until a buyer is found.

CompUSA was fighting on a number of fronts. First, competition has increased immensely since CompUSA’s start in the 1980s. In addition to direct sellers such as Dell, the company had to compete with Internet sites such as PCConnection, which offer low-priced products and easy comparison shopping.

In recent years, office supply stores, big box chains, and electronics retailers have boosted their computer offerings. They’ve been helped by companies like Dell, which have started selling products in a wider retail environment. Dell now sells its products in Best Buy, Wal-Mart, and Staples, among others. CompUSA was one of Apple’s largest resellers until recently, when Apple struck up a deal with major competitor Best Buy. Computer companies have been shaking things up to boost sales. Desktop computer sales have been dropping each year, while laptop computer sales have been growing rapidly.

Next, consumers weren’t always thrilled with the level of technological expertise of the CompUSA staff. Keeping staffers with technological know-how was not easy at low retail store wages. In addition, customers these days are better informed and don’t like feeling that they know more than the employee selling the merchandise.

Meanwhile, other specialty retailers such as Apple stores generally employ workers with a deeper understanding of their products.  The Apple’s “Genius Bar” requires an appointment to speak to staffers unless you pay additionally for a service plan that allows you to walk in and ask a question. (Of course, Apple’s Genius staffers have generated another set of complaints from consumers.)

While I do like to shop for most things, computers are not my forte. However, my husband, an active buyer of computer products, wasn’t surprised by CompUSA’s demise. He called the store layouts disjointed and the service not very good.  ”They’re the last place I would visit, ” he said. “Or if I’m in a rush and I know they’ve got it, I’ll go there.”

If he represents the average CompUSA customer, then it’s no wonder the chain finally gave up.

Will another bricks-and-mortar retailer attempt to recreate a viable computers-only marketplace or will consumers just have to fend for themselves when it comes to computer shopping?  Maybe no one will even miss the place … what was it called again?