CompUSA made the same mistake that other retailers have made in the past. Forgetting what your core business was. The addition of DVD players, cameras, widescreen TVs and DVDs took up valuable space from their computer business. They were never going to be able to compete with Circuit City or Best Buy on home electronics, they needed to focus on improving their selection and pricing on the computer products. Especially since the margin on computer equipment was dropping and pricing has become predatory.

Here in Columbus we had an TV & applicance dealer, Sun TV, who had fought off numerous competitors over the years and had established itself as the low-cost market leader. However, when Best Buy and Circuit City moved into the area, Sun tried to put computers, computer desks, and even bedding in their stores. Needless to be said, the endeavor failed and they ended up closing all of their stores throughout the state. Another retailer, Micro Center, tried the home entertainment market by opening a new store, Center Stage, that featured high end media centers, video games and big-screen TVs. That lasted less than half a year.

I don't understand why companies lose their focus - if you are known for a specific thing, you don't make yourself stronger my putting a lot of effort into a market where you can't establish a foothold. Look at Apple, their share of the computer business had dropped for years, but with the development of the iPod, iTunes and their online store, they developed a new marketplace and became the dominant player in the market. Trying to do the "me too" stuff hurt CompUSA and I doubt that they'll ever regain the position that they originally held.

And I have to think their practice of lowing prices through rebates rather than just marking items down hurt their sales as well. I know that I could usually find the same item cheaper at Best Buy or Circuit City NOW or even within a few dollars if I didn't care about not waiting for a rebate check. CompUSA tended to tick me off everytime I had to submit multiple rebates for some piece of hardware or software that they were advertising as being "on sale". And don't even get me started on their holiday sales - standing in line to get something they didn't have in stock or having to submit sales receipts, coupons, UPC codes or manual covers to qualify for a lower price (months later whne I received the rebate check) didn't attact me to choose CompUSA over Best Buy or Circuit City (or even Office Depot or Staples...)