CompUSA Closedown Coming in 2008

During Friday’s after-hours announcement, CompUSA announced a buyout from Gordon Brothers Group, which will liquidate CompUSA assets and close the remaining hundred+ stores. CompUSA cited competition from Best Buy, Frys, and Circuit City as their reason for dwindling returns. Mexican Billionaire Carlos Slim, currently operates the failed retail store.

Unfortunately for CompUSA workers, the electronics chain slowly degraded in many areas since the late 90s. If you’re a geek, you understand why the remaining CompUSA stores are to close their doors for good in 2008. I wanted to give Carlos a head-to-head rundown of what happened from the customer point of view.

WHY COMPUSA WAS GREAT

I worked at Apple, Inc. from 1999 to mid-2005 before making the leap into full time real estate. As Apple made it’s financial turnaround with the iMac and Mac OS 9 around 1998-1999, CompUSA jumped on board with a critical partnership.

Steve Jobs knew that he needed stores to carry and service Macintosh products. CompUSA was one of our largest partners. They were able to demonstrate the Mac on-site and even provided service.

On the other hand , Best Buy shunned Apple during this crucial relaunch period because Apple could not keep up with iMac demand. Best Buy was a growing powerhouse at the time and even I was afraid that the Mac comeback would fail without retailer support.

THREE REASONS WHY COMPUSA FAILED

There is probably a laundry list of why CompUSA failed, but here’s the quick list that my friends and I talked about after we heard the announcement.

Lack of Product, but Higher Prices.
CompUSA stores were often very small. Unlike Best Buy and Frys, CompUSA never upgraded to accommodate more merchandise. As the number of consumer gadgets increased, so did the need to add more product on the shelves. Even new CompUSA stores stayed small, perhaps to be more intimate, but this isn’t what we wanted. Geeks demanded more product and at more affordable prices. Why would we continue to shop at CompUSA when they would most likely not have what we wanted AND it would be at a premium? Most times, I’d simply go online to find the best prices and selection at Amazon.com, Buy.com, or locally at Best Buy.

Lack of Product Knowledge from Sales and Service.

Best Buy has the Geek Squad. Apple has the Mac Genius. Frys Electronics…well, they’re all geeks. CompUSA didn’t grab onto the consumer trend that geeks wanted our sales and service staff to be super-geeks. If I know more than the salesperson about a product, that’s bad news and I’ll go somewhere else.

Consumers need sales staff to guide us on the best product to buy, not simply read the back of the box for technical specs. We want service professionals to quickly solve our problems with minimal hassle. If we wanted free-form guessing, we can visit online forums. If we go to a store for service, we need expertise. The Geek Squad, Mac Genius’ and others are true experts at what they do. It’s fun to try to stump them, but most times, they simply solve your problem.

Poor Return Policy.

The return policy what caused me and everyone I know to ban CompUSA because they assessed a 15% restocking fee on opened items along with only having about a 15-day return policy. Was the 15% fee enough to justify losing a customer? Restocking fees don’t mesh with digital age because products may not work as intended. A quick look at CompUSA’s return policy online shows they still have the restocking fee, but the returns are now 21 days.

Best Buy and Frys, on the other hand, had return policies of 30 days for most products. Some products have 15-day returns, but the 30 days give you enough time to set up and try your gadget. If it doesn’t work the way you want, you can take it back with little hassle except standing in a long waiting line. At the very least, you’ll be given a store credit, which is fine at those chains because they carry just about anything you’d want.

GOODBYE TO COMPUSA

I wish all CompUSA employees the best. I can’t say that I miss higher prices, low merchandise, lack of a knowledgeable sales staff, and a poor return policy, but I personally appreciate how CompUSA supported Apple during their time of need in the earlier part of the decade. From my point of view, CompUSA was a big part of Apple’s stability at a time when the company seemed to be rocky. Perhaps that’s one of the great things the retailer can be remembered for. R.I.P. CompUSA 2008.