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Capitalism and the “failed” business – Post#507

Funky electronics chain Fry’s is no more | The Seattle Times

Fry’s Electronics

Even as a young platypus I was into electronics. I used to take things apart and solder them back in different formats. When Fry’s Electronics opened up it was my Mecca. I loved going in and picking a case, a motherboard, a processor, graphics card, hard drive, etc. Putting together your own system was the way to do it.

I could afford the parts but an entire system was too much back then. Time came when buying a system off the shelf was cheaper and the systems available were as powerful as I needed/wanted. Maybe I would upgrade the graphics or RAM. But now, even that isn’t required. I have terabytes of storage, Gigs of RAM and dedicated graphics.

It is part of capitalism that specialty stores are tenuous. Some remain because they fill a particular base. We posted about the tractors recently. That’s a specialty. Even that business has adapted though. Not too long ago there was a cupcake store on every corner. Most of them are gone now. That was a fad. The fad died, the stores went.

It isn’t something to be sad about because it is something to be expected.

Fry’s is really the last of the computer stores having outlived CompUSA and Circuit City. BestBuy is the last of the breed and they recently closed stores. Just like there is one cupcake store standing in your neighborhood, there is one electronic store standing. It is easy to blame Amazon but I think it is more complicated than that. As much as I do buy from Amazon, there are still things I want to touch before I buy and as fast as Amazon is, they aren’t faster than in-stock. I recently bought some hardware from BestBuy because it was cheaper than Amazon and they had it in the store. They can still compete. BestBuy increased their online presence, initiated price matching, and has free shipping options and in-store pick up. They also added products and got rid of some others. 

Failure to adapt means an end but not necessarily failure 

Fry’s isn’t the story of a failure. The store chain was successful and made people a lot of money. That’s what a business is supposed to do. Some business do go on for a very long time, but most don’t. Most go out of business. How do we really define a failed business? If the intention is to remain open a hundred years then most businesses do fail. We can say Fry’s failed to adapt. Though they tried online sales their web site was poorly designed. This is similar to how JC Penny failed to get online in time. JC Penny, the king of catalogues should have easily gotten online. It was a failure of vision that they didn’t. Same for Sears. That’s a brand that lasted for ages, went through many changes to compete, and in the end just was too big. Toys R Us, same. Prices went up, toy selection went down. 

Being in business is, for most businesses, an ongoing affair. You can’t just settle in your rut and think that you have it made. You have to be active and adjust. The cupcake places, they could survive if they innovate. Different flavors. That’s one way Baskin Robbins 31 flavors has survived. They keep the old flavors people love, but introduce new ones on a rotation. 

The different ways to do it right are too many to list. The ways to fail are pretty simple. I think it’s all pretty interesting to think about. I used to run a small business. I closed it. I did that because I knew that it was time. I wasn’t willing to put more into it (for some logistical but mostly personal reasons) to keep it going and keep it competing in the market place. I don’t consider the endeavor a failure though. It was just a something I did and no longer do. Capitalism is fluid. I suppose that’s the point I am trying to make with the above rambling ponder. It isn’t fixed, it is by nature competitive, and by nature ephemeral. That, perhaps, is why the faint of heart want socialism rather than capitalism. They just don’t have the ability to bob, duck, and weave nor to accept one chapter closing.

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