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CompUSA Closing Doors After Christmas

by December 10, 2007
CompUSA Closing all Stores

CompUSA Closing all Stores

You'd think with all the talk of hot electronics sales and a growing base of HDTV users that the larger chain stores would be flourishing and basking in the glory of increased sales and untold profits. Apparently, the CompUSA story is more akin to a large ship hemorrhaging cash and failing to compete in a sea of slashed profit margins and online sales.

This Spring, CompUSA received $40 million in investment income and closed over half its stores. Apparently this was the equivalent of twisting a tourniquet to stem the bleeding on a fatal wound. CompUSA based a large portion of its business on the sale of PCs and PC parts - a market that has seen its profits tank due to the prevalence of a few key online companies that have flooded the market with products at low-margin and reasonable shipping rates.

The remaining 103 stores are going to be either sold off to private companies or shut down completely following "Going out of business" sales over the Christmas season. If you are looking for a deal in your area this might be a good place to check out.

We often wonder, what causes such a large store to close? It's our belief that slashing margins was only one way for stores to compete. Combined with a strong economy and the successful positioning of consumer electronics as all but "disposable" and you got into a hairy situation that meant the lowest price won. This ultimately led to a very few volume leaders who decimated the market. It's a little scary and when the economy tightens up a bit, people may put a little more stake into a store that focuses on the long term effects of good customer support, warranty service and relationships.

CompUSA is being sold to Gordon Brothers Group LLC, a restructuring firm. Hopefully they will have some good ideas on how to take this failed giant and make an omelette out of the dropped eggs.

Source: AP via The Orlando Sentinel

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Clint Deboer was terminated from Audioholics for misconduct on April 4th, 2014. He no longer represents Audioholics in any fashion.

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Recent Forum Posts:

Thunder18 posts on December 14, 2007 00:20
That sucks, I have a 3 year extended warranty for my Creative Zen Vision M from CompUSA. I need to see if I can cancel the warranty and get a pro-rated refund.
AbyssalLoris posts on December 13, 2007 16:05
I have no idea how well managed they were and I'm not sure I've ever bought anything from them though I have browsed plenty of times. That's the same as saying I don't think it was ever worth the while. Even so, I am not pleased to see them go. One less option left. There's no monopoly right now, but as they start biting the dust one after the other, this might change.

Besides, who doesn't like having a few options?
Buckeye_Nut posts on December 12, 2007 13:06
admin, post: 340463
You'd think with all the talk of hot electronics sales and a growing base of HDTV users that the larger chain stores would be flourishing and basking in the glory of increased sales and untold profits. Apparently, the CompUSA story is more akin to a large ship hemorrhaging cash and failing to compete in a sea of slashed profit margins and online sales.


Discuss “CompUSA Closing Doors After Christmas” here. Read the article.
That doesn't surprise me. It was never a very compelling place to shop. Poor selection, unappealing to the eye, boring shopping experience……… They had a “Hills Department Store/Montgomery Ward” feel to them.
duallydave posts on December 12, 2007 11:16
Don't count on too many bargains when they close. I went by the local store when it had the closing sale, and they still had higher prices than other places like newegg. I ended up leaving without buying anything.
fmw posts on December 12, 2007 07:12
stratman, post: 341094
Hey Mr.F,

How's doin'…..If I'm not mistaken Forbes just put Mr. Slim as the world's richest man.

According to Forbes it varies between Slim and Gates on a daily basis, depending where the markets closed. Now with the CompUSA fiasco Gates might be ahead.


Perhaps based on published financial information. I'm pretty sure King Saud could buy both of them out and not feel much of a pinch. The financial media wouldn't have a clue about the king's wealth but the oil reserves of Saudi Arabia are pretty valuable aren't they? They belong to Saud and his family. Don't get hung up on what you read in the media.
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