Fry’s Electronics announced this week that it’s giving up the ghost, adding to a growing list of retailers who’ve called it quits during the pandemic.
“After nearly 36 years in business as the one-stop-shop and online resource for high-tech professionals across nine states and 31 stores, Fry’s Electronics has made the difficult decision to shut down its operations and close its business permanently as a result of changes in the retail industry and the challenges posed by the COVID-19 pandemic,” the company says on its website.
That’s the only page on its website, pointing to the complete and sudden demise of the entire operation, including online sales.
Joining the electronics graveyard
The San Jose, California-based chain got its start as a one-stop electronics shop for techie professionals in Silicon Valley. The shutdown "represents the end of an era and a sad day for its army of loyal shoppers," Neil Saunders, managing director of GlobalData, told Retail Dive, adding: “[E]ven before the coronavirus hit, Fry's was struggling to make the economics of its business stack up. More and more customers were drifting off to rivals, including specialists like Best Buy (NYSE: BBY) and generalists like Target (NYSE: TGT), as well as to online retailers."
Fry’s demise also adds to the list of brick-and-mortar electronics retailers who have gone away in recent years, including much larger operations such as Circuit City, HH Gregg, and the late, great Radio Shack.
They became casualties to e-commerce specialists and generalists alike, and the physical realm for those kinds of sales is now pretty much the domain of Best Buy and separate departments in big-box retailers like Target.
The Millionacres bottom line
Fry’s had the misfortune of being in a business that particularly lends itself to digital shopping at a time when people began staying home by the millions and shopping digitally.
From the real estate investor’s perspective, this is only a tiny number of stores scattered across a very large nation. But it’s still a reminder that a respected name isn’t enough to keep the doors open, and, if you’re an investor in retail real estate investment trusts (REITs), to take a look at their portfolios with an eye toward what vulnerabilities might be lurking there.
(FYI, if you have something under repair at Fry’s, the website says to email email@example.com to arrange for its return. Hope that works out. Still haven’t seen that Magellan GPS that I left at a local Circuit City in 2009.)