/EINPresswire.com/ Best Buy released its first-quarter 2012 earnings recently and net income fell 25%, against last year’s numbers. Big box stores have become a tool for consumers to see the product and then go and order it online at a lower price. Small stores on the other hand are booming!
Many Canadian shoppers have noticed that when they walk into a Best Buy or a Future Shop lately they can almost bowl down the aisles! So what is going on? Best Buy released its first-quarter 2012 earnings recently and although the numbers beat Wall Street expectations, net income fell 25%, against last year’s numbers. Other big box stores are experiencing similar problems. Staff at Canadian big box Future Shop (owned by Best Buy) reports that consumer traffic is down. It seems the very concept of having a choice of 30 different computers that stole the consumer away from the mom and pop shops in the 1990’s has seen the end of an era. They are now being outplayed by the low overhead online retailers like amazon.com. Big box stores have become a tool for consumers to see the product live and then go and order it online at a lower price.
Amidst all this there is another trend that is emerging at the same time. Look at the Apple stores; they offer a small focused line of product and their staff are experts on the products. In fact, in late 2009, Apple boasted that its stores brought in $4,300 per square foot, which was 5X the $872 per square foot that Best Buy did at the time. (source: http://www.businessinsider.com/apple-retail-2011-6#ixzz1xp9zrqlB). More current stats put Apple’s sales per square foot at over $6,000. Next in line is Tiffany’s at around $3,000 while Best Buy is under $1,000 per square foot. (source: http://www.asymco.com/2012/04/18/apple-stores-have-seventeen-times-better-performance-than-the-average-retailer/)
Playing right in the sweet spot of this trend reversal are the small boutique mom and pop type stores. Chris McGoey-Smith owns his own business which offers computer sales, service and repairs in the Calgary area: Rocky Mountain Computer Repair (RMCR). As Chris sees it, “customers are tired of being up sold expensive warranties, unnecessary setup packages, and dealing with sales associates that don’t know the product or have never used the product they are selling.”
So the upshot of this turn in events is that small mom and pop shops like RMCR are booming. As McGoey-Smith says: “If you want computer selection go to a big box store, or better yet buy something online. If you want something amazing; something that has been personally tested by us for a minimum of two weeks, then stop by Rocky Mountain. The stuff we sell is not your typical consumer grade disposable laptops; our units are drop and hinge tested, have innovative features like spill resistant keyboards, pressure tested LED panels, chip card readers, and are backed with a three year manufacturer warranty. Quite simply we sell quality products that we stand behind and we offer customers more personalized service.”
So what does this mean for stores like Best Buy? Forbes reports (found at: http://www.forbes.com/sites/abrambrown/2012/03/29/death-of-best-buys-big-box-store-company-will-shift-to-new-model-close-50-existing-stores/)that “Best Buy will shift toward mobile-phone sales and smaller stores in an effort to boost sagging revenue. Best Buy’s signature big box stores will be dialed back, and 50 will close in 2012.”
They will test drive the new store models in San Antonio, Texas and St. Paul, Minn. Ultimately they will reduce store square footage by 20%. Forbes reports (found here: http://www.forbes.com/sites/abrambrown/2012/03/29/death-of-best-buys-big-box-store-company-will-shift-to-new-model-close-50-existing-stores/) they will be called Connected Stores, “and will focus on selling cell phones, tablet computers and e-readers, as well as service plans not offered by Amazon and Wal-Mart. Best Buy employees in these new stores are expected to show customers how to connect electronics in the home.”
Rocky Mountain Computer Repair is a Calgary Computer Repair Shop. They specialize in Calgary data recovery, upgrades and repairs as well as sales and service of custom gaming computers, business workstations, and quality laptops. They also have a Calgary virus removal lab that can combat any computer security threat. Rocky Mountain Computer Repair is a proud supporter of the Calgary Community, through such events as Smash for a Cure and The Calgary Fringe Festival. They have been serving Calgarians with passion and accountability since 2006.
Chris McGoey-Smith
Rocky Mountain Computer Repair
403-536-8333
http://rmcr.ca
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