Future Shop is Dead, Long live the Internet.

Future Shop is the latest casualty of closures of Canadian Owned Businesses, or US Subsidiaries, closing in Canada.

The first ones were Sony, Smart Set, Jacob, Mexx, Holt Renfrew, Sears, and Zellers.

The biggest one is Target, which is still being debated, on why and how such powerful brand in the US, failed to execute in the Canadian Market, showing signs of weakness and dithering in the very first months, failing even to stock the stores properly. What seemed initial growing pains into a new market, turned to be the norm, and never allured the cross border shoppers to stay local.

Smart Set, Jacob, and Mexx, are pray of the survival of the fittest, and the wild competition with even supermarkets, with cheap brands as Joe Fresh (Loblaws) and George (Walmart). The ones surviving are premium brands (Roots, Danier) or subsidiaries of US brands (Tommy Hilfigher, Gap, etc.)

Zellers was let go to Target, by Hudson Bay Company, a once iconic brand, now owned by an American capital group. HBC decided to let go the “cheap” brand of Zellers, and to specialize in the (still profitable) medium luxury market.

Holt Renfrew came clear before Nordstorm landed in Canada, maybe deciding to close operations gracefully, before attempting to compete.

Future Shop death was long in the books, and it started when it was bought by Best Buy. While the electronics market was booming and everyone was buying flat LCD and Plasma TVs, there was space for two kids in town. Future Shop says that it fell because of the competition with Walmart and Costco. I don’t buy it.

Walmart is not a mayor electronics player, they have some products, but they don’t have the variety or the quality (it would be the equivalent of buying clothes at Joe Fresh instead of Roots).

Costco, never inspired my confidence in electronics, they have a narrow sample of products, and I always feel they are neither premium quality or the latest models. They have the weird model of a product that you cannot find anywhere else, therefore you cannot really compare if you are getting a bargain.

The Internet consumer matured, and people started comparing prices between Future Shop, Best Buy (no difference), Walmart, Costco, and Amazon. So what happened is that people will go to Future Shop and/or Best Buy to see the product, but ended up buying at Amazon.

As the consumer confidence on the Internet stores such as Amazon kept growing, and consumers purchased more expensive items, the market started to slowly dither for Future Shop.

In my personal experience, I have always liked more Best Buy than Future Shop, they have more variety and a wide range of choices on many products. The sales attitude as Best Buy was no pressure, while in Future Shop, it was more aggressive, if you could find someone.

For me buying a laptop computer in Future Shop was always a disappointment, I know exactly what I want (I am an IT professional), so the sales guy cannot make any profit on me, since I wont take their GeekSquad PC tuning service (always a rip-off), or accessories, or extended warranties. As soon as I told them I want X laptop they would ask if I needed any accessories, or an anti-virus, I would tell them, that I needed neither. When they told me that Windows (Vista, 7, 8 or whatever) needed optimization, or the anti-virus installed so that “my new laptop would be at the best performance”, I would reply that I didn’t care since I would be installing  Linux on it. At that point the sales guy would disappear not to be seen again.

My last visits to Future Shop were disappointing (months ago), you would see less stock, less variety, and they will start moving the stands to appear that the store was half-full, when in reality was half-empty. At the end you would see that  they were selling coffee machines, baby strollers, and even furniture. At that point, you could see they were desperate to keep the square footage profitable.

So, Future Shop is dead, but they were not victims of Walmart nor Costco. They were victims of Best Buy and bad service, and their real competition all the time was with Amazon.


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