Computer & Software Stores

Computer & Software Stores

Brief Excerpt from Industry Overview Chapter:

Companies in this industry maintain physical retail locations and specialize in the sales of new computers, computer peripherals, and software, including game software. No major companies dominate the industry.

The US computer and software store (computer stores) industry includes about 10,000 stores with combined annual revenue of about $22 billion.

COMPETITIVE LANDSCAPE

Business growth, personal income, and technological innovation drive demand. The profitability of individual companies depends on effective merchandising, competitive pricing, and reliable service. Large companies have advantages in purchasing, distribution, and marketing. Small companies can compete effectively by serving a local market, offering unique products, or providing superior customer service.

The primary competitors for computer stores are consumer electronics stores and Internet and catalog retailers. Computer stores also compete with office supply stores, direct sales outlets of computer, peripheral, and software manufacturers, value-added resellers, mass merchandisers, and warehouse clubs.

PRODUCTS, OPERATIONS & TECHNOLOGY

Major products sold by computer stores are computers and peripherals (40 percent of revenue); software (25 percent); and TVs, video cameras, and electronic game devices (15 percent). Other products and services include parts and repair and installation. Companies may also offer technical support and training classes. Some retailers custom-build PC systems.

Computer stores are typically located in high traffic areas within strip malls or indoor shopping malls. Store sizes generally range between 1,200 and 1,600 square feet. Companies may display demonstration merchandise that allows customers to experience products before purchase.

While large companies may buy directly from manufacturers,...