The logic of it may not compute, but at a time when other retailers are closing stores or standing pat, Toledoan Joe Chew is expanding his local chain of personal computer stores.
"I was always told - and from what I have seen, it's true - that any business that can hold on and survive in tough times, they tend to gain market share when things recover," said Mr. Chew, owner of the area's Computer Discount chain.
Over the weekend, the computer technician-turned-entrepreneur launched his sixth Toledo-area store, a 2,200-square-foot site on West Central Avenue at Holland-Sylvania Road in Sylvania Township.
The new store borrows some of its look from Apple Inc.'s sleek stores. It replaces a temporary outlet that Mr. Chew operated a few doors down the last several months to test market potential.
Initially, he feared opening a West Central Avenue location so near a Wal-Mart might compete with his store on Monroe Street in Sylvania. His fears were unfounded. "Though it's only 7 to 8 minutes away, we found people who shop the Sylvania store won't travel down here," he said.
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Still, Mr. Chew remained uncertain if the Toledo area could support another personal computer store. There are more than 15 personal computer stores in the area, along with big-box retailers like Best Buy, OfficeMax, and Office Depot. "That was in my mind but hopefully we've been around in this market enough to know what's going on," Mr. Chew said.
Nationally, the personal computer retail market has been hard-hit.
According to computer industry trend tracker IDC, of Framingham, Mass., demand for personal computers was expected to slow quickly this year as the economic crisis continues to evolve. IDC expects worldwide PC shipments to grow just 3.8 percent this year, with shipment value falling by 5.3 percent.
In 2007, CompUSA closed more than 100 retail stores, leaving it with just 16 stores and a Web site.
Circuit City, which sold personal computers and other electronics, closed its 560 stores this year and now sells only from its Web site.
Andy Dempster, manager of the MacCafe store, an Apple products dealer, in Sylvania, said the market for personal computers "in this part of the world isn't all that great right now."
Mr. Dempster said all industry trade magazines are saying that times are tough. "On the retail side, I can tell you we don't get as much traffic as we were getting earlier, but our sales numbers aren't off that much. However, it's a little thin, a little worrisome," he said.
Paul Zalecki, owner of the Computer Renaissance store in Toledo, said the market has shifted from selling new computers to servicing older ones.
"If I was looking at it today, would I open a new store? Probably not," he said. But Mr. Zalecki added that Computer Discount has spent many years developing its name in town, "and there's probably something to that."
Mr. Chew opened his first Computer Discount, in Maumee, in 1996 and his fourth store, on Laskey Road in Toledo, in 2005. In 2007, he opened Laputopia, a store for laptops only, on Talmadge Road in Toledo.
Retail sales vary widely, which is why local dealers say that providing service for computers has become a key to revenues. "Margins are so thin that service is an important part of the business now," Mr. Dempster said.
Mr. Chew said service can be coupled with new sales. "People don't mind paying a little bit more if they know that if something goes wrong, they can bring it back," Mr. Chew said.
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