Wal-Mart Plans to Reduce Space for Electronics in Stores - Page 3

But how profitable are Frys and Micro Center? Are they growing? Even businesses that were considered "strong" have passed (Comp USA, Tweeter, Circuit City).

If a b&m cannot affford to keep on its staff, much less grow into areas that they haven't operated before, what good does it do it to sell below cost to price match online competitors AS A PRACTICE? Online stores are basically warehouses with a website.

It can't continue to do it. It's basic math we're talking about.

At least at Frys, and I assume others, they now do price matching, except not against every on-line seller. They told me they have a list of on-line companies they will match. This includes Amazon, tho. I'm not sure if BestBuy is doing matching.

I'm not surprised at the change at WalMart. As others have noted, customers are reluctant to buy an expensive product at a place where they can't get any knowledgeable help. Might as well read reviews and go on-line, or else shop somewhere at a more specialized store where they have at least a few salespeople who know what they're talking about.

Stores like WalMart, which aren't specialty stores, aren't set up to sell relatively high-priced specialty items. They are best at selling mass-market stuff like light bulbs and diapers where all the minimum wage sales drones have to do is point you to the part of the store where the product is located.

The obvious problem now for all b&m retailers, as others have mentioned, is that they have become showrooms for Amazon and other on-line retailers. Consumer electronics is a tough market to compete in, because the margins are so low. It's hard to compete against drop-ship on-line companies when you have so little room to move.

Consumer electronics is amazing for consumers, though. Think about it - you can get a better piece of electronic gear today for $300 than you could have 20 years ago for $1500, for example. I wish cars were that way!

I know microcenter matches newegg. The sales rep made it a point to check newegg and pricematch it for me when I was building a new system.

I like anyone else like paying the lowest cost for anything I buy but I think this is one of the problems with America right now, we are not willing to pay the "real" price for goods. I agree with most of the comments above but I see some that say that electronics retailers still make reasonable margins. I have to disagree, margins have plummeted in the retail sector and wages have continued to climb along with the cost of energy and the amount of inventory needed to stay competitive. There used to be 40-60% margins on emerging technologies, which makes a B&M a sustaining business model but now with computers and TVs only carrying 2-30% margins even the newest stuff, and believe me most of them are closer to the 2 there are not nearly enough profits to sustain.

That will be a sad day when B&M retailers die, even though I hate wal mart, B&Ms employ a huge percentage of the US population. Lets hope the economy turns around and we can play a little more fast and loose with our spare change, that's where jobs come from boys and girls.

This is exactly the point I've been trying to make .. it's not all about the best deal .. at least, it should not be ..

If you are comfortable with others making the choice for you by an on line recommendation, then hey, go with it ..

I have several friends in the newspaper business and let's just say, it does not appear to be a growth industry these days ..

This has been tried before and failed. Then tried again and failed. I am sure it will be tried again and fail then too. See below:


Now - take this answer, triple the anger involved, maybe add some profanity in it and what you end up with is a large number of people demanding the online price in store.

Do you:
A. Remain firm and don't give in on the price and end up with a pissed off customer who won't return and tell others about the horrible experience
B. Give in on the price and deal with the lost revenue at the store front (due to the additional overhead costs incurred locally)
C. Mix of A and B until the idea is shelved for a couple of years before it is tried again


The same people who bought the CompUSA address also bought the Circuitcity.com address. (I think it's the same company that owns tiger direct)


I have only been in the Micro Center by me so I don't know if this is universally true for them but I believe MC and Frys operate close to the same way - which is not how CC and BB operate. MC and Frys have a small number of stores in very population dense areas. This most likely makes them much higher volume stores. BB and CC had significantly more stores which lead to a number of them having a signficantly lower volume of sales merely due to location

Also - the store I was in seemed much more crowded with products than your typical BB or CC. They are cramming more products into a smaller space in (I am guessing) an attempt to maximize the products per floorspace and minimize realestate costs. CC and BB would tend towards more open layouts which, while I feel makes them more comfortable stores, is probably monetarily less efficient

I am guessing that they carry more products on site (due to the limited number of stores, distance between them, number of products on the floor) in order to reduce their distribution costs

I think this will be the way more and more B&M stores operate (A more warehouse-ish business model). They'll stay around but in vastly diminished numbers.

I live in Washington State and they have a sales tax on most things. I live a few miles away from Oregon, which has no sales tax. Yes, I could drive my ass over there and purchase things, but I do not. Now that I am buying a house in Clark County, I see the value of buying locally. Every dollar that I spend in my own city goes towards keeping the cost of living down for homeowners and people that are less fortunate. My property taxes stay low, county provided services cost stay low, and the roads are well maintained. Sure, I could drive over to Portland and purchase all my big-ticket products, but that just hurts me in the end. I think people need to understand how materialism works and how spending money locally keeps everybody employed. I just purchased a $1,800 GE Profile duel fuel stove to replace the contractor special gas stove that came with the house. I could have purchased the stove in Oregon and avoided the sales tax, but I did not. I chose to purchase the stove in my town. I paid a chunk of money in sales tax, but I feel like I did the right thing by helping out the tax base of my county and city. Young people need to understand this and not buy on the net. I have purchased all of my personal electronics, appliances, and house locally. I have paid a HUGE amount of money in sales tax, BUT I see the value. I think it is sad that most B&M stores are closing up and going away. Before I spend my hard-earned money, I like to touch, play, and tinker with the product. Most mom and pop stores know their ****. Most mom and pop stores will allow you to play with the product before a purchase is made. I like this kind of shopping. On the other side, most big box stores have grown too big. There is just too much competition when it comes to selling personal electronics. The personal electronic market has been saturated with so much crap, most people are sick of walking into electronic stores. How many Ipods do people really need? I have 1. This is all I need. This is why B&M stores are going away. People have too much crap they never use.

I buy nothing from walmart anymore, I hate the store with a passion, I buy all my CDs,blu rays.,DVDs etc at fye, or best buy when I am close to on. Walmart sucks, too many morons waltzing around in there. My electronics recently have been purchased online, we have no av stores worth a nickel around here, and the one we do have the guy tried to cheat me on a package I wanted, and also took two weeks to tell me how bad he wanted to cheat me.

Totally agreed with you here, as for me is better to see the tv in a electronics store, and if i like it, buy the same product via online (much cheaper than in the store)

Blessings

Joernzal777

It's unrealistic for people to think that B&M can match online pricing. Salary, retail floor space/rental, shrink can be insanely expensive. And the whole excuse about how people aren't helpful or educated or knowledgeable about their products in store anymore is BS. I work in retail sales for a major wireless carrier. I'm probably one of the most knowledgeable people around when it comes to phones and wireless products, that doesn't stop the majority of customers from either

A. Ignoring my advice because they think I'm trying to 'sell' them something
B. Taking my advice and then saving themselves $20 by buying online then coming to the store to have me teach them how to use their device and help set it up for them.

When those situations happen it makes me super-pist off. Now I'm all about online retailing, I buy almost everything online, but I also research everything extensively so I don't require in store help. I still shop at microcenter often as well as my local Hi-fi shop because we can meet in the middle pricewise and I love the service they provide.

Until taxes are applied for out of state, and shipping costs go up, B&M will continue to suffer. B&M will become more of a specialty/niche area rather than big box IMO.

wal mart should think about it many years before and make significant changes with new trend of online sales 10 years ago

Your logic is very hard to follow. "I want to pay a lot in sales taxes because I don't want to pay a lot in property taxes". Six of one, half a dozen of the other. "Only buying locally" would mean essentially NO trade--can't buy a car because it isn't made "locally", can't buy food that isn't grown "locally", can't buy electronics not manufactured locally, etc. And what does "too much competition" mean? "Too many competitors" selling at too "low" a price (what, you'd rather keep them high?)??

If mom and pop stores are fading, it's because people WANT it that way, and there is no reason for them to want it YOUR way.

I realize the whole Walmart situation can get somewhat political, and I'm not saying that the opponents don't raise some valid points, but I do have to say that the Walmart backend processing continues to impress me. They seem one of the better big box stores at pricing and keeping inventory in stock, and certainly their hours and one-stop nature make it easy to go there. As it happens, our local Walmart isn't so local, so I don't go there much, I do factor in travel time and cost in my shopping decisions, but when I am there, they have a well run operation. It's easy to see why they've caused K-Mart and others so much trouble. As to the question of how they treat their employees, and if their pricing tends to push local businesses out of business, there's no doubt some aspects there to be concerned about. And I do respect individuals that make purchasing choices trying to influence Walmart and others to do better. Certainly the Walmart going-green aspect was partly to offset some of that. But in the end, a lot of that is not just Walmart's problem, it's a U.S. wide problem, insufficient or antiquated laws and structures, and if what Walmart is doing is legal and ethical (and I'm not saying this is always the case, but when it is...), maybe we should leave them alone, and work so that the playing field is more level. The American system is based on competition, and so long as they've stayed within the rules, hard to really criticize someone that's just very good at the game.

On the collecting sales tax issue, I think one of the problems is that it's so difficult for a seller, be they Amazon or some little 3-item seller on e-Bay, to calculate and distribute the sales tax. I think that the main people complaining are the bricks & mortar operations, but I think people would be a lot more supportive of collecting taxes if it was easier and more transparent. Maybe the states should get together nationally and implement an eCommerce clearing house for calculating and distributing the sales taxes.

[I pay my uncollected taxes on the income tax form here in NY, but that's more an ethical/moral thing, I'd much prefer it be collected automatically]

I hate walmart but always end up being there.

I've worked a tad in retail at a box store so let me just add a few things.

Competition in retail is hard...very very hard. If you have the space to do something you can sell nearly anything. Drug stores now sell eggs, supermarkets have office supply stores in them (I have one with a staples..about 100 yards from a full staples..go figure). Even smaller businesses are combining to make a draw. I've heard of a barbershop next to a gas station so you can get a hair cut while you wait for work to be done etc.

Walmart does not sell everything...yet. They are actually trying to test appliances in texas http://walmarthelp.com/wal-mart-test...texas-reuters/
Eventually I think they'll carry them in most stores. That is why they are going to cut down on the amount of electronics.

There is nothing wrong with electronics but lets face the fact here electronics constantly drop in price. Since they nearly constantly have to be replaced with new product it involves a cost of replacement and removal. Appliances are not as updated so walmart is trying to save more money and time.

Sears is not doing well..picture Ottoman empire at the start of the 20th century. Some suggest that it might close but they have a number of assets. I wouldn't be surprised if other companies end up buying them (Kenmore, Craftsman etc)

The remodeled WalMart by me has a bigger electronics section now.

I hate WalMart, but I reluctantly go there for some things because they are much cheaper. Never bought any A/V stuff there...

Sometimes as painful as it might be, you gotta take a stand against tyranny of one kind or another. My son took a summer job at a local Walmart and while some might think the low prices are worth the tradeoffs, this chain is the worst american nightmare in a long time. Just my two cents.

I bought nearly everything for my home theater I just put together online. However, I did a lot of my "shopping" at best buy so I could actually hear the stuff I was looking at. As a courtesy to best buy, since I like having somewhere to go locally, I bought my receiver at best buy even though I could have gotten the same receiver for $25 less in "like new" condition from Amazon Warehouse Deals. Speakers from new egg & ebay, cables and Subwoofer from amazon, and I paid a little extra for my receiver so that I can continue to have a brick and motor store to go to do my compro shopping.

I used to buy food and beverage from Wal-Mart but haven't tried electronics too many yet. Recently, just noticed that some online stores have pretty good prices for electronic gadgets. So, Wal-Mart has to change itself to face the changing world.

I have no idea why Wal-Mart or any store that has an extensive range of electronics would marginalize their store space, especially with popularity of electronics

Internet my friend, Internet the new walnet, the online take over is in the works!

I grit my teeth every time I read some Forum member bragging about how they tried out a new piece of gear down at their local retailer then saved a whopping 5-10% on-line.
I wonder if they are the same ones complaining that they can't find any decent gear within a day's drive of their home town anymore.

Wallymart can reduce their elctronic space all they want because I would never buy an HDTV there anyway. Talk about selling junk.