An insider from electronic retailer, CompUSA, has announced that the company plans to close more than half of its stores within 90 days.
It is part of a new strategy where they feel it will benefit them to close some of the stores with low performance and/or high rent costs. The first stores to close were in Chicago a few days ago.
It is speculated that a lot of the stores which will close will be in metropolitan areas due to high rent.
Also, some of their stores have been making less lately due to tough competition from rivals Best Buy and Circuit City as well as the plethora of websites online selling electronic goods such as Newegg and Tiger Direct.
CompUSA has made several changes in recent history such as adding more wanted items such as flat panel televisions.
This is just the most recent part of their plan to turn the company around and make it a more serious threat to the bulldogs of the market (Best Buy and Circuit City).
Along with shutting down these 126 stores in the United States, they have begun remodeling some of their other stores to make them more attractive to potential customers. Some of the stores which will be shutting down will stay open during the holiday season, in an effort to make some last minute money.
These stores will have heavy discounts on their merchandise which could be a great thing for consumers looking for good Christmas presents. Having fewer stores (after all of the closings there will only be 101 remaining in the United States) will give corporate more time to focus on each one as well.
After reporting losses in the 3rd quarter, as well as for the past two fiscal years the management felt that something had to be done.
Carlos Slim, who owns a large stock in the company, said Carlos Slim, stated CompUSA receive an immediate $440 million cash capital infusion aimed at boosting the company’s balance sheet as part of the realignment. Only time will tell us whether or not all of these changes will work to turn around the company.