The Micro Center in Cambridge, MA, has improved a lot over the years.
When they have the thing that I want, I'd prefer to go there, rather than order online.
Also, I've never seen opened returns re-shinkwrapped and sold again as new at Micro Center, unlike in stories about Fry's. There are some wire shelves where opened returns are sold at a small discount, clearly labeled.
Incidentally, would be nice to also have a good surplus and e-cycling store browsing adventure in town. But I guess the economics are difficult, when real estate is so expensive, and most of the few customers for unusual stuff are online. (That local hobbyists could save a lot of money on shipping cost of decommissioned corporate and lab gear, or make impulse purchases they wouldn't online, probably isn't enough, I'd guess.)
That store is dangerous. The last few times I went "just to browse" but I came home with an ultra wide monitor and a new PC build.
I've started buying parts retail instead of online just because of how much I enjoy Microcenter. The interior does need a bit of a renovation though, it looks almost identical to how it did in the 90s.
90s anachronism is a perfectly valid aesthetic. I dislike the tendency to think that things must constantly be changed for purely aesthetic reasons. This tendency was intentionally created in order to sell more things -- look up the history of Ford and Alfred Sloan for details.
While maintaining the 90s vibe is commendable, the keyword is maintain. Cambridge and Cincinnati complement their 90s aesthetic with grime and stains also from the 90s.
If it is not broken, do not fix it. Renovations would cost money, which would mean higher prices. It is better to stick with what works than see prices rise to cover pointless renovations that would harm their competitiveness. The money is better spent on expansion that would pay for itself.
Dude don’t update it. Do you really want it to look like Best Buy? Because that’s the ad company they will hire to remake their brand. But it will be even more of that.
Amazon prices what they can get away with, not what their costs are. Jeff Bezos’s rocketry hobby is a testament to Amazon’s ability to extract surplus.
I think the point is Amazon cuts costs and reduces price first, prices out the competition through economics of scale, then once competition is eliminated is able to raise prices.
Stores often refuse to stock products unless they are given a comfortable enough margin on them that can be as high as 25%. That is how they can afford to do deals on CPUs to draw people into the store. Amazon also has overhead in shipping costs to customers that the brick and mortar store does not, since they receive goods in bulk that amortizes costs. They both also want as much money as they can get out of the customer, so they have little reason to lower pricing upfront unless they think that it will help them get even more money (like how microcenter cuts prices on CPUs since they expect to make it up on everything else you need to build a PC).
Microcenter is a surviving personal computer retailer from the DOS days.
Seemed like they were intentionally flexible enough at the beginning so they would be able to go forward with any and all manufacturers that might turn out to prevail, back when nobody knew for sure.
Whether the future would more strongly include Apple, IBM compatibles, or any other alternatives which have come & went.
It was a "superstore" by design, decades before Walmart got there through its unavoidable momentum.
The vast majority of items do need to fly off the shelf, but it's best not to purge too much of everything else. The smartest operators can actually stock a larger number of slower-moving items too.
Also I have seen some affordable stock pulled from the shelves and online like smaller capacity SATA SSDs, after higher-capacity or more modern units naturally replace them as technology progresses. Looks like they mark down the less-modern units, or they won't move at all, and those can then end up at the point where further markdown would be below cost. All remaining stock disappears to a liquidator, which are more common than ever these days. Just when you thought it was really going to get good. It used to be easier to browse for "stragglers" that were too expensive when first released, if you waited a year or two those prices could be really slashed when more modern versions took over the mainstream, if you could find any stock remaining.
I drive right by the one in Houston almost every week where you can see the store conveniently a block away from the freeway, only sometimes for that same reason the traffic can get so bad that it's a 20 minute ordeal getting back out of the parking lot, down that block, and back on the freeway :\
So sometimes I'll wait a few weeks before just dropping in, but it's also always been good to have when you need something right away.
Except recently when I knew exactly what I wanted, a 2TB SATA laptop HDD, not an SSD for this particular PC. I still had a 1TB NIB in my storage unit from a few years ago when I picked up a couple but only used one at the time.
Well, these days they had nothing. Except a few items of one SKU that was your typical modern garbagey SMR HDD, which modern SMR is miserably sluggish (you know, like a snail without a shell) by comparison to regular HDDs from previous decades (which were all conventional CMR until some SMR bozo came along). SMR is very frustrating even for long-term storage, and completely useless in a laptop. Give me a break.
Had to then go to the storage unit and dig out the 1TB one I already had.
Nobody's fault but mine for shopping and trying to be a consumer when it's not absolutely necessary :\
I don't recall ever asking for a price match at a brick&mortar, even though I'm aware it's available at some stores. I'd guess most people don't.
The store gets some mileage out of being known for price-matching competitors (even online competitors, where that'd be a bit much).
(Well, occasionally I have questioned in-store, when a major chain shows one price on the Web, available at a specific brick&mortar location, but when you get to that location, there's a much higher price on the shelf. Now I tend to order for pickup at those stores, which is more work for them, just to lock in the Web-advertised price, rather than the switcheroo price.)
I will make stores price match anything and everything. I also look at every item on my grocery check out to make sure the price is exactly what the shelf said. I concede no ground to fine print sales expiration dates. However, I am a freak when it comes to remembering these things after a decade of business purchasing and I did my fair share of taking advantage of the consumer.
I frankly enjoy fighting stores on pricing and get dopamine from a good deal and it pains me to pay more than necessary even if I can afford it just fine. I understand not everyone is like this.
There was a period a year or two ago where if you leaked cookies and ad tracking to Amazon and deliberately clicked through to competing sites their algorithm would aggressively slash pricing far below MSRP. I admit I would use this technique in microcenter to get Amazon to give me ludicrously cheap pricing then turn around and make them price match for instant gratification.
Retail/amazon operate at a much higher margin than most people realize.
>Retail/amazon operate at a much higher margin than most people realize.
Then why don’t their 10-Ks and 10-Qs show it? There is a reason it has a reputation of being a cutthroat business. Out of all the big retail businesses, only Home Depot/Lowes has 8%+ profit margins, and Apple obviously.
Because net profit margin is different from gross margin. The products are still marked up way higher than that bottom line number. PMn is the margin after you add in all the over head costs and those really have little to do with whether they are loosing money by selling a product under their target mark up.
Best Buy making a gross $250 on a $1000 priced TV or $50 when discounted to $800 still isn’t loosing any money unless they are at their credit ceiling and cannot replace the good sold. They make zero if A customer standing in their store deciding not to even give them $50 and giving it a to a competitor on their cellphone. Tho is absolutely profit opportunity lost, even if it is small.
>Retail/amazon operate at a much higher margin than most people realize.
This statement encompasses the whole business, for which the profit margin is the relevant metric, not gross margin. And it is clear that the standard retail business is not one in which you can earn a lot of money. Just because a specific item sells to a customer for more than what it costs to buy just that specific item from the supplier, does not mean the business's margins are high. There are myriad costs that have to be accounted for, such as spoilage, theft, inventory, transportation, labor, returns, etc.
Some things sell for higher margin, some things sell for lower margins, but at the end of the day, the stores clearly operate at very low margins. Hence why so many go out of business all the time, and all the brick and mortar we have left are the biggest ones with the largest volumes.
That is not what we were talking about though. We were talking about how much discount you can force out of a retailer via price matching which is a function of its Gross Margin. a 25% discount at the register doesn't mean a bottom line 25% subtraction from Net Margin. Those numbers are distantly connected and most operating costs (minus COGS) are fixed.
That might work for a few customers, for a few products sold at high margins. But mathematically, if the business started giving everyone 25% discounts, and they already only have a 2% profit margin, then it doesn’t pencil out that it could survive.
Bottom line is if a business, and an entire industry in this case, has 2% to 5% profit margins, across 10+ publicly listed businesses, across decades of operation, it means they are selling goods at about as low of a price as possible (averaged over all goods). Some will be high margin, some low margin, some negative margin, but at the end it’s only resulting in a couple percent of profit.
Consider the case of a business operating at excessive margins with huge room to discount but doesn’t. Their fixed costs must then be spread over few transactions and lower their net margins to almost nothing. Instead a business operating at a much more socially optimum price point sells a huge amount of goods at a lower mark up and gets to spread those fixed costs over a lot more transactions. Their Gross markup may be less than the high priced store but their net margin can be higher.
I set a lot of prices during the pandemic. Any average business found that they were granted some degree of monopoly power and could generate higher net margins with less competitive prices. Many of us found the simplest solution was to just pass on all costs to the consumer because they had no choice but to take our price or not get their good.
Times are different and there is competition but many businesses have still forgotten how to increase gross margin by having a sale.
Not to get into politics but tariffs are the same way. The elasticity of demand for a good determines the monopoly power of the supplier/retailer and how much of the tariff gets passed on to the consumer. Highly interchangeable products will not see the full tariff passed on to the consumer because that would mean forgoing all sales. The importer will determine how much gross margin they can give up without loosing money…but the producer in the foreign country also does the same math. Do they completely give up the American market to save inventory for other markets or do they eat some top line profit and still make some sales.
Many goods will indeed be pulled from the market, but if the producer fails to find replacement customers in other markets they will look back at 300M Americans and reconsider whether they can give their importer a better price while still making something. If the good expires, like say a case of white wine, or becomes obsolete in the case of say a lightning charging cable there is additional pressure to make the decision before the surplus simply becomes unseeable.
If a good has no viable alternatives and is relatively shelf stable expect all tariffs to be passed along because the products price is already disconnected from its cost and the business producing it is closer to a monopoly than not.
Amazon pricing isn't always that good and they lie about the discounts and retail prices, at least here in the UK. My US colleagues tell me the same is true in the US. I've actually found that general high street crap seller Argos here tends to have better retail prices than Amazon. I can just amble on down the road and get what I needed same day pick up in person rather than wait for a delivery to turn up.
If every person price matched every item, they'd be screwed, but: most people don't, many items just can't be, and if eg you're price matching a $20 cpu cooler, you may also be buying a $500 cpu or a bunch of other components that they'll actually make money on.
This is also why different stores have different skus for items - that $20 coolermaster 40mm with red LEDs is cm40rl-w at Walmart and cm40rl-a at Amazon.
Retailers will absolutely budge on this technicality, this is to disarm those that aren’t aggressive. Everyone’s retail margins are wayyyyyy higher than they want the consumer to believe and their holding costs are non-negligible.
I thought the purpose of that was to let them avoid price matching on certain items despite having price matching policies. I have never heard of one budging on this. Have any?
It is so the manager has a policy to fall back on to say no. It is just the second round of negotiation.
I am not saying everyone will play ball, but managers whose pay is a function of sales likely will. Have you ever negotiated buying a car before? Indicating you will let corporate know they lost a sale by not budging on price will almost always win the negotiation with managers who think they can just be lazy without consequence.
In the standard retail environment, I have definitely had businesses price match products with the same specs but very slight SKU differences, you just have to be open about a willingness to forego the instant gratification because that is the only service in person retail provides today. That might mean actually completing the sale online and then asking again. They know when there is actually a material difference to the products.
Businesses that are legit monopolies will not budge.
It's not too uncommon for retail stores to match Amazon, as long as it's specifically both "sold by Amazon" and "shipped by Amazon". Best Buy does too, for example.
Oh God. I wish the sales clerks would leave me alone. They’re always trying to put their sticker on purchases and proffer useless advice. Still, it’s the best in the area, and the Trader Joe’s is a draw. I bought my first computer, an Apple //gs at Micro Center at their original, single location.
They're not there for you, they're there for your grandma. They also get paid terribly, let them put their little stickers on. You never know when they might return the favor.
Oh yes. I'm strongly in favor of having a sticker on everything and want these salespeople to get credit for every purchase even when I know exactly what I want.
Regardless if they gave me any help during that particular visit or not.
Considering New Hampshire’s lack of sales tax, I’m patiently waiting for Micro Center to establish a new presence in Nashua or Salem. The Cambridge location, while personally cherished, isn’t that accessible by car because of Boston’s stress-induced car traffic congestion. Even on foot, getting to the store is still a bit of a journey. Also, let’s not forget Massachusetts’ 6.25% sales tax.
In New Hampshire, I am positive Micro Center would attract customers from all over New England and make an absolute killing from sales, potentially overshadowing their Cambridge profits. I would never shop online or in Cambridge for hardware again. But, I’m sure they wish not to jeopardize the Cambridge store or their MIT and Boston tech hobbyist clientele. Otherwise, I am surprised they have not yet acted upon this idea.
Google maps says Salem is 40min+ from Cambridge, and Nashua is 50min+ from Cambridge, and add another 10min to 20min from other parts of Boston.
Each minute of driving costs at least $0.67 (from IRS), excluding increased morbidity and mortality risks (injury from car collisions is the top health risk for most Americans).
So even using $0.50 per minute of driving, if you are only going to NH to evade sales tax, that is 80min*$0.50cents = $40. $40/0.0625 =$640.
So the first $640 of the purchase doesn't even save you any money (even more for most Bostonians further than Cambridge), and it costs you 1 to 2 hours of your life driving back and forth. If you value your leisure time at at least $100 per hour, then you're looking at spending at least $2,200 for the tax evasion to start paying off.
I'm just positing why Microcenter will not open a NH location anytime soon, because most of its customers (who are in Boston metro) won't find that it pays off to travel to NH.
Tax free weekends exist in MA as well, yet a lot of people still travel across the state line to buy tax free items like booze.
It's not always logical, but sometimes you find yourself outside of the city or heading north to be wilderness and the value prop changes if you're already heading that way.
I agree that MC won't open one here, as we can't even get an IKEA closer than Stoughton.
When they have the thing that I want, I'd prefer to go there, rather than order online.
Also, I've never seen opened returns re-shinkwrapped and sold again as new at Micro Center, unlike in stories about Fry's. There are some wire shelves where opened returns are sold at a small discount, clearly labeled.
Incidentally, would be nice to also have a good surplus and e-cycling store browsing adventure in town. But I guess the economics are difficult, when real estate is so expensive, and most of the few customers for unusual stuff are online. (That local hobbyists could save a lot of money on shipping cost of decommissioned corporate and lab gear, or make impulse purchases they wouldn't online, probably isn't enough, I'd guess.)