Is CompUSA Going Out of Business?

CompUSA is a retailer and reseller of consumer electronics, technology products and computer services. As an established retail business with a very successful retail branding, CompUSA is serving consumer retail, small-to-medium businesses, corporate, government, and education customers.

When the economy was starting to see troubles back in 2007, there had been news of more than 100 CompUSA stores to be sold or closed after holiday sales. Is CompUSA going out of business?

Is CompUSA Going Out of Business?

CompUSA is not going out of business. It went through some corporate re-structure program and had made a comeback in year 2009.

Let’s see some headlines that was published in December 2007:

End of the line for CompUSA - 103 stores to be sold or closed after holiday sales

CompUSA Closing 100 Stores Nationwide, Unemployable Smartasses Everywhere Are Devastated

EXCLUSIVE: CompUSA Closing 100 Stores

With such a mass number of stores being closed, it is no doubt that there were rumors about CompUSA going out of business at that time.

2 main reasons why CompUSA is going out of business back then:

1. Competition
Hammered by competition from Best Buy, Wal-Mart, Circuit City, and internet retailers.

2. Massive Overhead
Burdened by over $100 million in unsalesable store inventory, with huge stores and droves of ineffective employees.

Whether CompUSA is going out of business or not, the fact is that on or immediately before February 28, 2007, CompUSA retained the services of Gordon Brothers, a company that specializes in liquidation, for the purposes of closing 126 stores nationwide.

The closing locations were chosen based upon their overall performance, profitability, and proximity to more successful competitors such as Best Buy, Fry’s, Microcenter and Circuit City.

This first round of closings reduced the number of stores to less than half of its previous number.

Is CompUSA Going Out of Business? Not Really

On January 6, 2008, Systemax announced its purchase of 16 CompUSA locations as well as the brand, trademarks, and e-commerce business.

It is a new and improved CompUSA. With little in the budget, the electronics retailer put the idling computers in its showrooms to work, and to great effect.

A smaller CompUSA is bouncing back. Despite the recession, the chain’s sales are growing with a thrifty remake of its reopened stores.

Even CompUSA web site has been ranked among the New York Times’ “Top 25 Online Retailers”.

In essence, CompUSA’s new owner is turning the stores into Internet entrance ramps. “We want to give people the rich experience of buying online,” says Gilbert Fiorentino, who heads the chain’s retail strategy. (Business Week)

Who could have imagine a retailer that closed more than 100 of its stores just a year ago, had made a come back with a stronger internet presence ?

The Net access has become crucial to CompUSA’s survival, if it breaks down, then they will look just like any old retail store again.

Is CompUSA going out of business? Time will tell.

For more info, visit CompUSA online store at http://www.compusa.com/

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