CompUSA, back from the dead, grand re-opening in Fla.
MIAMI —To paraphrase a quote from Mark Twain, reports of CompUSA’s 2007 demise were greatly exaggerated.
While it’s true the once mighty computer retail specialist shuttered it last store in December 2007, more than a dozen locations in Florida are now back in business under the ownership of computer supplier Systemax Inc. The Miami-based company, best known for its Tiger Direct online and mail-order computer business, essentially bought the banner and has reopened 16 stores in Florida and Texas, with more on the way.
“During the [first} quarter, much of our attention was spent on the conversion, refurbishment, restocking and re-opening of 16 CompUSA retail stores,” said Gilbert Fiorentino, president and ceo of Tiger Direct during a first-quarter conference call on June 17. “This included all new point of sale and other IT systems, restocking of stores with new inventory and grand opening events and promotions.”
Though the relaunched CompUSA Web site and the few stores open before March 31 generated only $18 million in income for the quarter, the company expects sales to pick up this summer as customers rediscover the stores. Fiorentino also said the company has signed direct deals for CompUSA with more than a dozen CE suppliers including Sony, Nokia, Mitsubishi and Bose.
Systemax plans to build the CompUSA store base with several new openings this year and by integrating its eight Tiger Direct retail stores in the United States and Canada into CompUSA.
“We currently have plans to open three more stores, two in Canada and one in Florida,” said Fiorentino. “Long term, we intend to re-brand our Tiger Direct stores as CompUSA, leaving us with a single brand retail strategy in the [United States].”
What’s unclear is how Systemax plans to make its CompUSA stores stand out in an intensely competitive market that drove the original chain out of business. (Fiorentino could not be reached for comment about the company’s strategy.) The 23-year-old chain closed 126 stores in March 2007 and the remaining 103 stores last fall, amid heavy losses and sharp declines in same-store sales.
“Tiger Direct has a decent catalog and online business, but catalog companies usually don’t do very well at the store level,” said George Whalin, president of Retail Management Consultants. “They still have to contend with Best Buy, which continues to grow and get stronger, and even Circuit City.”
Whalin suggested the stores might try to replicate the Tiger Direct online business model, which sells private-label and name-brand computers and computer supplies at low prices.