Good Guys! B&M shuts down

[topspeed]

Good Guys!, a longtime electronics retailer on the west coast has announced the closure of all of its stores. Some will be merged with CompUSA outlets.

For those that aren't on the west coast, this is a shame. GG is a couple of steps above Circuit City and Best Buy in not only product quality but also customer service. GG carried Parsound HCA and Halo lines, Monitor Audio, Energy, Focal, Gallo, and Klipsch to name but a few. TV's were represented by Mits, LG, Sony, Sharp, Hitachi, and JVC (off the top o' my head).

The good news is that if you are looking for a good deal, get thee down to a GG and negotiate the hell out of some new toys! Initially, it's 10-30% off everything. However, either bring cash or wait a bit and you can do better. Trust me.

[L.J.]

Good Guys!, a longtime electronics retailer on the west coast has announced the closure of all of its stores. Some will be merged with CompUSA outlets.

For those that aren't on the west coast, this is a shame. GG is a couple of steps above Circuit City and Best Buy in not only product quality but also customer service. GG carried Parsound HCA and Halo lines, Monitor Audio, Energy, Focal, Gallo, and Klipsch to name but a few. TV's were represented by Mits, LG, Sony, Sharp, Hitachi, and JVC (off the top o' my head).

The good news is that if you are looking for a good deal, get thee down to a GG and negotiate the hell out of some new toys! Initially, it's 10-30% off everything. However, either bring cash or wait a bit and you can do better. Trust me.

I just got my Energy's from there a few months ago. I got the last pair of C-9's in stock for 50% off and a good deal on the rest of my speakers. I don't think it had anything to do with this but maybe it does. I'll have to see what I can get my hands on ;) . There's a CompUSA next door to my GG so maybe they're just movin.

[paul_pci]

Man, that totally sucks as I have a GG card.

[dean_martin]

Once again crap prevails.

[L.J.]

The paper this morning states that some will become a CompUSA-GG megastore and that some stores will remain open for 60 days. During those 60 days they will be having a closeout sale.

You can check their website for a list of stores that will be having this closeout sale.

[Florian]

Yup, the good ones usually die first.

-Flo

[topspeed]

Once again crap prevails.
Once again, your unfettered lyrical prose remains unequalled. :p

[GMichael]

Only the good die young.

[paul_pci]

I'm going down to one of the "special sale" stores in a couple hours. I'll post my findings.

[Woochifer]

Sad news because I've always liked their product lines and their customer service. But, in recent years, they've been slow to adapt to changes in the market, had a very unfocused approach, and really let their service slip. Ultimately, they could not adjust to a rapidly changing market and that's probably what did them in.

Timing of this closure is also strange because three of the Bay Area stores that they shut down on Tuesday were recently remodeled into CompUSA/Good Guys megastores and had grand reopening sales only about a month ago!

Good Guys started as a homegrown electronics store in San Francisco, and they expanded throughout the Bay Area and for about 20 years built a very successful niche. Then they made a huge splash when they expanded into the Southern California market in 1990 by opening a flagship store at the Beverly Center that was open 24/7. For a college student, there was nothing quite like auditioning audio equipment at 2am! I even bought my turntable at that store at 3am one night after a night out.

In their Southern California expansion, they competed with three other local electronics chains (Federated, University, and Rogersound Lab) that were already hobbled by Circuit City's entry into the California market a few years earlier. Good Guys' debut pretty much wiped out the local chains, and for years Good Guys was the biggest player in the middle market -- a step below the high end boutiques but a notch above the Circuit City-type mass merchandisers.

Good Guys' though has never figured out whether it wanted to sell more to the mass market, or if it wanted to go more into the high end stuff. At one point, they sold computers, video games, and CD/videos as well to try and pull customers into their stores. Then they decided that they wanted to move away from the mass market, and got rid of those product lines to focus on audio/video/home theater components.

Problem is that video games and DVDs generate foot traffic, and Good Guys' target market moved away from individual component purchases, and more towards installed systems and distributed media server systems. Good Guys was slow to respond to this market shift, while new competitors Tweeter and Magnolia moved into the California market having already responded to the demand for those services. Best Buy now adding Magnolia Home Theater ministores inside several of their stores only worsened Good Guys' competitive pressures.

Good Guys further compounded their problems when they tried cutting their costs by laying off most of their commissioned sales reps. I knew people who worked at Good Guys, and when they had a commissioned sales staff, all of their new sales reps got trained at the company's headquarters. And to sell products in a specific department, the sales reps had to have additional training for that area (personal electronics is where all the sales reps started, and they had to receive additional training to sell video, audio, and/or mobile electronics). Good Guys might have cut costs, but they also let go a lot of people who knew how to generate revenue. The noncommissioned sales reps in my subsequent visits did not have nearly the same customer service skills and product knowledge.

Good Guys was already in financial trouble when CompUSA bought them out a couple of years ago. At first, CompUSA said that they would start carrying some of Good Guys' product lines in their CompUSA stores, and focus the Good Guys stores on expanding into more higher end lines. Then earlier this year, CompUSA announced that they would convert several of the Good Guys stores into CompUSA/Good Guys megastores. Then the megastores opened, and now a month later, they've been closed and the remaining Good Guys stores are starting their clearance sales. Sad end to a once reputable and appealing store chain.

[paul_pci]

Went down to my local "special sale" Good Guys and immediately I saw a sign that said 10%-30% off all inventory. I found this salesman I worked with a couple weeks ago, looking at Velodyne subs (he's helpful and knowledgable. He said right now he has a restricted ability to make deals and that right now everything is only 10% off (I guess they don't really want to move their inventory. The primary reason he couldn't wheel and deal is that Good Guys no longer owns their inventory, a liquidating company does, and there was a liquidator lawyer in the store overseeing everything. He said, next week they will be receiving inventory from "non sale" stores and I should check back to see what's up then. And that I will do. It would be awesome to get a deep discount on a $1k Velodyne sub.

I shall report back here next week, probably Friday.

[Defshep]

Sad news because I've always liked their product lines and their customer service. But, in recent years, they've been slow to adapt to changes in the market, had a very unfocused approach, and really let their service slip. Ultimately, they could not adjust to a rapidly changing market and that's probably what did them in.

Timing of this closure is also strange because three of the Bay Area stores that they shut down on Tuesday were recently remodeled into CompUSA/Good Guys megastores and had grand reopening sales only about a month ago!

Good Guys started as a homegrown electronics store in San Francisco, and they expanded throughout the Bay Area and for about 20 years built a very successful niche. Then they made a huge splash when they expanded into the Southern California market in 1990 by opening a flagship store at the Beverly Center that was open 24/7. For a college student, there was nothing quite like auditioning audio equipment at 2am! I even bought my turntable at that store at 3am one night after a night out.

In their Southern California expansion, they competed with three other local electronics chains (Federated, University, and Rogersound Lab) that were already hobbled by Circuit City's entry into the California market a few years earlier. Good Guys' debut pretty much wiped out the local chains, and for years Good Guys was the biggest player in the middle market -- a step below the high end boutiques but a notch above the Circuit City-type mass merchandisers.

Good Guys' though has never figured out whether it wanted to sell more to the mass market, or if it wanted to go more into the high end stuff. At one point, they sold computers, video games, and CD/videos as well to try and pull customers into their stores. Then they decided that they wanted to move away from the mass market, and got rid of those product lines to focus on audio/video/home theater components.

Problem is that video games and DVDs generate foot traffic, and Good Guys' target market moved away from individual component purchases, and more towards installed systems and distributed media server systems. Good Guys was slow to respond to this market shift, while new competitors Tweeter and Magnolia moved into the California market having already responded to the demand for those services. Best Buy now adding Magnolia Home Theater ministores inside several of their stores only worsened Good Guys' competitive pressures.

Good Guys further compounded their problems when they tried cutting their costs by laying off most of their commissioned sales reps. I knew people who worked at Good Guys, and when they had a commissioned sales staff, all of their new sales reps got trained at the company's headquarters. And to sell products in a specific department, the sales reps had to have additional training for that area (personal electronics is where all the sales reps started, and they had to receive additional training to sell video, audio, and/or mobile electronics). Good Guys might have cut costs, but they also let go a lot of people who knew how to generate revenue. The noncommissioned sales reps in my subsequent visits did not have nearly the same customer service skills and product knowledge.

Good Guys was already in financial trouble when CompUSA bought them out a couple of years ago. At first, CompUSA said that they would start carrying some of Good Guys' product lines in their CompUSA stores, and focus the Good Guys stores on expanding into more higher end lines. Then earlier this year, CompUSA announced that they would convert several of the Good Guys stores into CompUSA/Good Guys megastores. Then the megastores opened, and now a month later, they've been closed and the remaining Good Guys stores are starting their clearance sales. Sad end to a once reputable and appealing store chain.

Circuit City continued their downward customer service spiral when they cut commission sales, too. The problem is that most people are getting used to poor service in exchange for "convenience". Look how big Wal-Mart is. I hate to see a company that does it right go under.

[L.J.]

I took a look at GG today also. The store was already a mess. Just as Paul said 90% of the items were only 10% off.

All Monster products were 20% off.

Batteries, camera cases and a few other misc. items were 30%

[PAT.P]

Who gives a ****, Beeeeeeyitch!You must be PMSing Penis Malfuction Syndrome.

[Woochifer]

Update on the sale --

I popped by the San Jose store yesterday. (Sad but true, I'm looking for a S-VHS VCR because the tracking on mine went haywire over the weekend, and most of my recent tape library was recorded in the S-VHS ET mode) The place was sadly disorganized with boxes and demo units strewn all over the floor.

Video products are still only 10% off, but all audio components have now been reduced by 20%. This includes Yamaha and Denon receivers, along with Monitor Audio, Klipsch Reference, and Energy speakers. I saw a Yamaha RX-V2500 for $800, and a Parasound multichannel amp reduced to $1,700 (it was just sitting on the floor looking like a doorstop).

When the Good Guys stores close, Yamaha, Klipsch, and Energy will have big time distribution problems in N. California because Good Guys represents the vast majority of their retail presence here (at least with their higher end models).

[anamorphic96]

The SF store on Masonic was in pretty bad shape as well. Your right about the Energy distribution. Looks as if Sant Rosa will be the closest dealer.

The other ironic thing is there are no PSB dealers in SF as well. You have to head out to San Mateo.

Anyone know why some of the bigger names dont find reperesentation in certain big cities like SF ? :confused:

[Woochifer]

BTW, the LA Times wrote an interesting and sobering article about Good Guys' demise. It indicated that Good Guys was the victim of a rapidly changing market, and caught in a no man's land where they were too small to compete with the big mass merchandisers, and too big to provide the specialized services that independent dealers provide. Good Guys might have also expanded too much in too short a time.

The article also faulted Good Guys with overstacking their product line with expensive component based systems, while the market shifts towards portable and mobile devices. The days of the middle level regional specialty audio/video chain store might indeed be numbered. This might not bode well for companies that rely on these types of stores to distribute their products.

The article also indicated that the overall size of the audio component market is now down to $1.2 billion annually -- an 8% decline from 2001. In the context of overall retail sales, that is a pittance. Consider how many players make audio components, and that's not a very big market to divide up. Comparatively, the MP3 player market is over $2.6 billion.

Anyway, the article is linked and clipped below ...

http://www.latimes.com/business/la-fi-goodguys8oct08,1,810673.story?coll=la-headlines-business

Changing Consumer Habits Spurred Demise of Good Guys
# As shoppers migrated to electronics superstores, the audio-video retailer wasn't able to keep up.

By James F. Peltz, Times Staff Writer

Struggling to keep pace with the fast-changing market for consumer electronics, Good Guys Inc. found it wasn't quite good enough.

The retailer, which specialized in higher-end televisions, home audio systems and other cutting-edge electronics gear, catered to savvy technophiles while providing trained store personnel to educate less sophisticated customers.

But as a regional chain serving a narrow audience, Good Guys couldn't survive the mass market's migration to electronics superstores such as Best Buy Co. and Circuit City Stores Inc. and to discount retailers such as Wal-Mart Stores Inc. And Good Guys' emphasis on bulky, high-priced sound systems was out of step with young consumers more apt to enjoy music with the aid of computers and hand-held players such as the iPod from Apple Computer Inc., analysts said.

CompUSA Inc., which acquired Good Guys in 2003, closed 11 of the chain's 46 stores this week and said it would shutter all but one of the remaining stores — almost all of which are in California — in two months. One store in Santa Clara, Calif., is being converted to a CompUSA.

There is "a decline in the need for free-standing stores that only sell high-end home entertainment products," said spokeswoman Katie Means of CompUSA, which also has shut down sales on Good Guys' website.

CompUSA, which is controlled by Mexican billionaire Carlos Slim, said it would move much of Good Guys' inventory into 38 of its CompUSA stores in California and Hawaii, further expanding its product line beyond computer equipment.

Good Guys' passing marks the end of a longtime California retailer. The chain was started by entrepreneur Ronald Unkefer, whose first store in San Francisco bore the sign "The Good Guys." The Alameda-based company expanded rapidly, going public in 1986 and opening its first Los Angeles store in 1990.

In Good Guys' fiscal year ended Feb. 28, 2003 — its last year as a public company — the chain was operating 71 stores and earned $1.1 million on sales of $750 million.

But the profit was an anomaly. Before that, Good Guys had lost money for six straight years, and Dallas-based CompUSA was able to acquire the chain for $55 million — the equivalent of 7% of Good Guys' annual sales.

Because CompUSA is privately held, it declined to provide more recent financial details for Good Guys or say how many employees might be laid off with the latest closures. But Good Guys' performance "confirmed our belief that consumers wanted a broader product offering in one location," Means said.

Competitors such as Wal-Mart and Best Buy offer one-stop shopping for a wide range of electronics, DVDs and audio CDs, which they can sell at relatively low prices because their size gives them buying clout with suppliers. Best Buy and others also are beefing up their service and support, diluting one of Good Guys' strengths.

Changes in consumers' tastes, and in technology, also sealed Good Guys' fate, analysts said. "This has less to say about CompUSA than it does the state of the consumer electronics industry as a whole," said Stephen Smith, editor in chief of Twice, a trade publication.

Good Guys, for instance, was known for peddling sophisticated tabletop receivers and large, expensive speakers. But "that business has completely dried up because young people don't sit in a chair with two speakers blasting at them much anymore," said William Armstrong, an analyst at investment firm C.L. King & Associates Inc.

Many audio fans today increasingly listen to iPods, MP3 players and other portable devices that play songs downloaded from personal computers. Home entertainment systems also are increasingly melding their video and audio capabilities with computers.

U.S. factory-to-dealer sales of audio components such as receivers and home speakers are expected to total $1.16 billion this year, down 8% from 2001, according to the Consumer Electronics Assn. Meanwhile, sales of portable MP3 players are forecast to hit $2.65 billion this year, more than double 2004 sales.

The convergence of computer and audio-video technologies is one reason CompUSA is moving Good Guys' products into its own stores, so that consumers can be exposed to all of them in one place.

The shift also left Good Guys too dependent on sales of high-end TVs, a cutthroat market where "you're competing head-to-head against Best Buy and Circuit City," Armstrong said.

Good Guys hasn't been the only mid-size electronics chain to feel the pressure. Ultimate Electronics Inc., a Thornton, Colo.-based chain that once had more than 60 stores in 14 states, filed for bankruptcy protection in January and has since closed about half of its locations. Tweeter Home Entertainment Group Inc., a Canton, Mass.-based chain with 160 stores in 22 states, including California, also has struggled in recent years.

That doesn't mean independent electronics stores can't survive, said Smith of Twice. Many consumers still prefer the service of small, local stores, and the independents — if well managed — also can avoid the financial headaches that often come with overexpansion, he said.

"To say that this is the end of specialty audio-video retailing as we know it may be overreaching," Smith said. Unfortunately for Good Guys, he added, "they weren't big enough and they weren't small enough."

[Woochifer]

The SF store on Masonic was in pretty bad shape as well. Your right about the Energy distribution. Looks as if Sant Rosa will be the closest dealer.

The other ironic thing is there are no PSB dealers in SF as well. You have to head out to San Mateo.

Anyone know why some of the bigger names dont find reperesentation in certain big cities like SF ? :confused:

I think that a player like Energy will get picked up by some of the independent audio stores, now that they no longer have to compete with a midlevel chain like Good Guys. Klipsch Reference will likely also get picked up by somebody, given that Good Guys was the only Bay Area dealer for that particular line. It's just that in the short-term, customers considering the product lines carried by Good Guys, will have much fewer places to find those products until other dealers step in and pick up those lines.

In San Francisco, there are only a limited number of independent audio stores to begin with. Also, high end manufacturers give their dealers territorial exclusivity, so that you won't have competing dealers in close proximity to one another selling the same product lines. In exchange, the dealers agree to promote the brand and provide a high level of aftersales service.

The other thing to consider is that the Bay Area is a regional market, and most of the population and income are south of San Francisco. The Peninsula is actually a logical location for an audio retailer because it's equidistant from both San Francisco and San Jose. Plus, the Peninsula is a high income market in its own right.

[topspeed]

Thanks for the article, Wooch.

I feel like a dinosaur now.

[Woochifer]

Thanks for the article, Wooch.

I feel like a dinosaur now.

No kidding! So, I guess this is what a generation gap feels like. :)

[L.J.]

Took a little trip to GG today. Yep, 20% off almost everything except for video. They were only letting a few people in the store at a time due to limited sales staff. I think only 4 people were running the store.

They had the Energy RC series out today.NICE!!

I'm just gonna sit around like a vulture for a little while longer.

My wife's gonna kill me :eek:

[thekid]

I went to their website to see if there was possible deals. From their website;

Current Good Guys Customers

After more than 30 years of providing the best in high-end entertainment products, along with unmatched service and support, our freestanding stores are closing, and the Good Guys web site is no longer available for transactions.

If you are a Good Guys customer, know that all product orders, service events, extended service plans and warranties will be honored:


Existing Product Orders: We are making every effort to contact customers with existing product orders. You may have already received communication updating you on the status of your order. Please know your order will still be fulfilled. If you have a question about your order, please call 1-800-229-4897.


Existing Service Orders: If your Good Guys product is currently being serviced, the service will be completed and your product will be returned to you. If you have a question, please call 1-800-229-4897


Warranties: Manufacturer warranties will continue to be serviced through the product manufacturer. Please refer to your warranty directly for details and instructions.

Good Guys Extended Service Plans: For customers who purchased Good Guys extended service plans, these plans will continue to be honored through GE. Please call 888-897-7982 for extended service plan information.


Product Returns: During the closing, no products can be returned to Good Guys locations.


General Questions: If you have a general question, please call 1-800-229-4897.

We look forward to continuing to provide you the best in quality home entertainment through CompUSA:

CompUSA – Featuring Expanded Home Entertainment in-store
All California & Hawaii CompUSA locations will expand their selections to include and feature premium home entertainment. Good Guys customers can continue to receive the best in quality products and services they know and trust through CompUSA.

Good Guys - Closing Locations without Special Sales
Several Good Guys locations will close immediately and will not have Special Sales.

[Woochifer]

Wound up buying a VCR over at the Dublin store last night. Got the last new-in-the-box S-VHS unit at that store. Hope this one lasts because VCRs in general (that are not combo units) are disappearing fast, and S-VHS units in particular are very hard to find.

The Dublin store was one of Good Guys' showcase stores, and it was a sad sight to see. Most of the demo rooms have been turned into storage areas where components are just stacked up or shoved into any available shelf space. Strange to see all of these well regarded and sometimes pricey audio components just strewn around the store like garage sale items, and all these demo rooms turned into closets. Nothing is plugged in, except a few HDTVs.

One of the items that I'll be keeping a watch on is the Sony ES SACD player, which lists for $400, but Good Guys has marked down to around $300. If it goes down any further, I might be tempted to pull the trigger on that purchase, especially since the ES players come with a 5-year warranty.

[L.J.]

GG vulture update:

So this is what I saw today.

All video and audio = 20% off
All cables(They only carry Monster) = 30% off
All Car audio = 30% off (As soon as it reaches 50% off, I'm diving in)
All DVD's, Camera cases, Batteries and misc. items = 30% off
All open box(I think) = 40% off

Store was a mess. Now they're pulling all there stocked items onto the floor. I was looking at some open box speakers and alot of them were in pretty bad shape. Cracked grills, dents in the woofers, broken feet. There has been so much foot traffic going on, plus a lack of staff, I'm assuming people are being very careless with the merchandise.

Maybe at 40 or 50 percent off I will buy something. Can't beat getting DVD's for 5 bucks. If theres any left.

[paul_pci]

Last night I got the chance to go to the Huntington Beach store. The store looked to be in decent shape and there were lots of people there. Most of the stuff appeared to be 20% off and some of the nicer big screens were only discounted a few hundred dollars. Although, I did spot a very tempting deal: Parasound Halo A23 for $611 (probably for the floor model but I don't know). I'm going to keep checking back at my local store and see what further discounts crop up, or merely shrug my shoulders at it. As much as I'd love a Velodyne sub, I simply can't pay full price for it.

[paul_pci]

Made my weekly call today and the guy I've been dealing with said he had a floor display Velodyne SPL-8000 II for $500, so I ran down there and picked it up. Considering that I had a cheapie KLH sub, I'm very impressed and happy with what I've heard so far—Jurassic Park. Can't wait to tool around with it more later. And of course, I'm tremendously happy about picking up the sub for basically half the retail price.

[shokhead]

I love those kinds of deals. Never pay reg price.

[GMichael]

Made my weekly call today and the guy I've been dealing with said he had a floor display Velodyne SPL-8000 II for $500, so I ran down there and picked it up. Considering that I had a cheapie KLH sub, I'm very impressed and happy with what I've heard so far—Jurassic Park. Can't wait to tool around with it more later. And of course, I'm tremendously happy about picking up the sub for basically half the retail price.

Congrats. Happy thumping.

[hermanv]

In our town there were three small electronic specialty stores. Good Guys put them out of business by offering much better prices on competitive merchandise.

As soon as the competition was gone, all Good Guys prices jumped to full list and stayed there.

Now, other retailers offer discounts on electronics and Good Guys is being driven out of business by the same technique they used to kill the local small retailers.

The salespeople in these small stores were knowledgeable, whereas my experience with Good Guys was being quoted or misquoted sales brochures (if they could find them at all) no skills, no knowledge, no pay, awesome turnover.

I have no sympathy for business who live and die by the creed of greed - good riddance.

[shokhead]

Who's to say what greed is?

[Kam]

Who's to say what greed is?

Gordon Gecko.
:D

[Woochifer]

In our town there were three small electronic specialty stores. Good Guys put them out of business by offering much better prices on competitive merchandise.

As soon as the competition was gone, all Good Guys prices jumped to full list and stayed there.

Hmmm, I don't recall them ever doing any kind of predatory pricing when they entered the Southern California market in 1990. Good Guys did kill off a lot of competitors in SoCal, but those were predominantly regional chains that were already on life support because of Circuit City's entry a few years earlier. The independent stores adapted by simply shifting their product lines into brands and products that the chain stores weren't selling, or shifting into a high volume-low cost operation.


Now, other retailers offer discounts on electronics and Good Guys is being driven out of business by the same technique they used to kill the local small retailers.

Actually, I think Good Guys simply got caught in the middle when comparable competitors like Magnolia and Tweeter expanded into the California market, while the rest of the market started moving over to portable electronics and discount stores. Good Guys moved their product line away from what Wal-Mart, Circuit City, and Target were offering a while ago, but that left them with only the mid-tier component market, which was already a stagnant segment when the new competition entered Good Guys' territory. Magnolia and Tweeter adapted to the market much faster than Good Guys did, by offering home installation and design services.


The salespeople in these small stores were knowledgeable, whereas my experience with Good Guys was being quoted or misquoted sales brochures (if they could find them at all) no skills, no knowledge, no pay, awesome turnover.

This is an industrywide trend unfortunately. Circuit City started the downward trend when they laid off all of their commissioned sales reps four years ago, and replaced them with hourly employees. Good Guys had to follow suit, and it was even worse for them because historically, they trained their employees. Once they shifted over to hourly employees, it all went downhill from there.

[hermanv]

I know it's not an easy market. Most stores will be hard pressed to compete with the internet head on for that save every penny customer. This seems to me to be a loosing strategy.

I like internet savings, I expect no support (pleased when it happens, but I don't count on it). On the higher end gear or even expesive TV there's enough margin to sell hand holding, delivery, set up or other techniques designed to win that returning customer.

We used to have a small independent shop near here that offered reasonable discounts, quality brands and had knowledgeable sales people, I refered many customers there. Then they too switched to an hourly no benefit employee model; get in, make the sale, get out format. I stopped going and I stopped recomending them. the parking lot is usually empty when I drive by. What will they do with all the money they saved? Give it to the bankruptcy attorney I suspect.

These places measure the huge savings when they first switch to the new sales format, forgetting that the customer base was built up slowy with a different technique. Then the base dwindles, now what?

My town is kind of a small town as modern cities go, it is quite possible that a different tactic may be needed depending on the size of the customer base. i.e. I soon learn who is a good source, but the Los Angeles customer might never come back to the same store in his lifetime. The LA store has bigger volume, needs deeper discounts using the same pricing model in every franchise may not work.

[Woochifer]

I know it's not an easy market. Most stores will be hard pressed to compete with the internet head on for that save every penny customer. This seems to me to be a loosing strategy.

I like internet savings, I expect no support (pleased when it happens, but I don't count on it). On the higher end gear or even expesive TV there's enough margin to sell hand holding, delivery, set up or other techniques designed to win that returning customer.

We used to have a small independent shop near here that offered reasonable discounts, quality brands and had knowledgeable sales people, I refered many customers there. Then they too switched to an hourly no benefit employee model; get in, make the sale, get out format. I stopped going and I stopped recomending them. the parking lot is usually empty when I drive by. What will they do with all the money they saved? Give it to the bankruptcy attorney I suspect.

These places measure the huge savings when they first switch to the new sales format, forgetting that the customer base was built up slowy with a different technique. Then the base dwindles, now what?

My town is kind of a small town as modern cities go, it is quite possible that a different tactic may be needed depending on the size of the customer base. i.e. I soon learn who is a good source, but the Los Angeles customer might never come back to the same store in his lifetime. The LA store has bigger volume, needs deeper discounts using the same pricing model in every franchise may not work.

The independent stores have been staying afloat by offering complete start-to-finish home theater installation services. The store owners I've talked to have indicated that they cannot stay in business by just peddling components. The price competition from chain stores and the internet's too fierce. The big margins for the stores in my area have come from installations, and that's kept them in business. The stores that stuck with two-channel audio components as their main lifeline, are almost all gone.

Magnolia and Tweeter have moved into the installation market, and that does put a lot of competitive pressure on the independent stores that have stayed in business through their installation services.

No matter how big or small a town is, there's only so much that households on average spend every year on electronics. If there aren't enough stores in a given town to meet demand, then people will travel to the next town to do their shopping. But, if the existing stores already meet the local demand, then any new stores will either have to attract new customers from outside the area or build their business by taking sales away from existing stores.

In Santa Rosa, I remembered going to a high end audio store downtown about 10 years ago. (For that trip, I drove up to Sebastapol to visit Mobile Fidelity Sound Lab, and see if I could pick up some of their half-speed mastered LPs) Miraculously, they had a turntable belt that I couldn't find anywhere in the Bay Area. No idea if that store is still there, sound familiar to you?

[shokhead]

Between BB,CC and GG,i always liked GG as far as selection goes and sale prices were ok. The help was no better or worst then the other places. Difference is BB and CC has CD's and DVD's and games and that brings in alot of business.

[snodog]

More power then to the cocksuckers at Best Buy. I hate this store and the clueless people working there. I have sworn to never buy another pieced of equipment from them. I like the selection of cd's though, but there isnt much of a failure rate in them. Too bad needless to say, it would be nice to have a selection.

[hermanv]

In Santa Rosa, I remembered going to a high end audio store downtown about 10 years ago. (For that trip, I drove up to Sebastapol to visit Mobile Fidelity Sound Lab, and see if I could pick up some of their half-speed mastered LPs) Miraculously, they had a turntable belt that I couldn't find anywhere in the Bay Area. No idea if that store is still there, sound familiar to you?

As you probably know Modile Fidelity filed for banckruptcy, they were owed a lot by a distributor that never paid. I think they are born again, but I don't recall the new name. The building sat empty for a while and some new bussiness moved in. The reborn Mobile Fidelity is sowewhere in the area, but I'm unsure where.

There are still a small number of those old kind of shops, you know the ones I mean, a lot of clutter and at least one of everything, but only the old guy knows where to find it. We have a vacuum cleaner store like that, any small belt, I'd bet he has it. We also have a guy selling out of his house. The Tweak Shop I think it's called, great fun, buy equipment have a cup of coffee. These people can contribute, they can teach you things.

In high end, one wrong purchase averted will make up for a lot of savings you get from dealing with a know nothing mass marketer. You will never be invited to have dinner at home with a Good Guys or Best Buy salesman

[sam9]

I suspect they have a train of poor decisions leading up to this. A year or so ago there was a "personal interest" story in the paper about a laid-off engineer working at GG doing commission sales. He was the top producer (and earner) at the store (maybe the region) so to cut costs they fired him. Think about it-- they fired the guy who was producung the most sales because they didn't want to pay the commissions he was earning! Darwin stikes again!

[L.J.]

Went to GG a couple of days ago. All speakers were 40% off.