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  1.  permalink
    The one thing that always surprised me about Fry's is how despite some rather geeky employees that corporate comes off as employing the pointy haired boss from Dilbert. Back when I worked for V-Con the amount of lies and half truths was amazing.  
     
    Furthermore, I don't understand why they Fry's seemed to carry a lot of junky stuff that comes back again and again and again. I never worked in returns except as backup from the sales floor so pardon my ignorance if someone knows better. Unless ECS has a pretty liberal RTV policy on crediting Fry's for defective hardware I gotta think that Fry's is losing $1000s of dollars a day per store off returns of ECS products and relabeled ECS products (all the GQ products). The mobo/CPU bundles I'm sure indirectly get a lot of people in the store who buy one or two other things while they are there, but the GQ computers I found were losing money left and right.  
     
    A lot of geeks were buying the linux boxes and not buying a PSC or anything else with them. Even a lot of the people buying the slightly more expensive Windows based GQ boxes weren't very profitable if at all. The GQ machines had a pretty high DOA rate and an even higher return rate. Sure there are a couple of people who bought them who came back and said the thing was still working x years later, but a lot of people who bought them acknowledged that they were cheap, but found the reliability far too lacking. I heard there were people who managed to get those things in service enough times to get a permanent replacement as opposed to a loaner.  
     
    Another big mistake was that a lot of the Fry's machines were ugly not only on the inside, but also on the outside. With the exception of the exception of the FM8445, most of the chassis they used on their machines were so ugly that I think I would rather have an HP chassis and those are pretty ugly as well. They only ever made one machine I know of that didn't use an ECS motherboard and it used a joke of a video card even for when it was released. Even my less geeky co-workers considered it a joke. I think one of the big issues I have is that corporate's argument for a private label computer were somewhat dishonest. They claim a doomsday situation where fill in the blank vendor decides to exclusively sell through one retailer and Fry's can't sell fill in the blank hot computer. That won't ever happen. A big problem I see is that Fry's never seems to sell private label machines that really fill an unfulfilled niche in their product line. Another drab looking tower with integrated video or a dedicated card so pathetic that a lot of people wouldn't be able to tell that it was dedicated video is filled pretty well by HP and Gateway's line pretty well. They need something that isn't a just a cheap knockoff of a major vendor's line. I'm thinking home servers, or MythTV boxes, or or the very least some modestly priced Media Center boxes that use a consumer electronics form factor as opposed to a tower. Nobody is going to put a tower next to their television. It will look ugly. People want something they can put on a shelf in the television stand like their PS3.  
     
    Another huge gaffe is why Fry's tries to not let associates get commission off sales in different departments. This discourages associates from showing the customer another product in another department merely because they won't get any commission for the other departments products. "It also creates competition between departments that make no sense. No don't buy the computer departments cables, the components department has cheaper cables."  
     
    Another thing that never made sense was the low reliability of their servers. Anything short of three nines of uptime(99.9%+) for a retail POS terminal is just unacceptable. Two nines of uptime would be three days a year of downtime. Three nines is still about eight hours of downtime. I remember seeing lines at Fry's that sat there doing nothing for 5-10 minutes. Not only do the sales associates and the cashiers lose money when customers give up on waiting, but that is money that Randy Fry loses as well.  
     
    Probably the most annoying thing was the demeaning attitude that managers tell you to accessorize when we don't have almost anything to accessorize the customer's purchase with. I remember I wanted to sell the Belkin easy transfer cable, but it was frequently out of stock and none of the other transfer cables paid anything. Unless business is slow Fry's doesn't make it worth your while. Furthermore, how many Ip1800 or MP210s does a customer really need? On mac sales most customers want to buy AppleCare with the purchase and Fry's doesn't sell AppleCare. I really learned quickly that if I couldn't close a mac sale on someone who wanted AppleCare pretty quickly by telling them they didn't need to buy AppleCare at the same time as the computer that I was screwed on the sale. It was also equally stupid that Fry's didn't carry the mini-DVI to VGA adapter. I sent no less than a half a dozen customers to the Apple store to buy that adapter.  
     
    Why Fry's couldn't just have simpler promotional financing offers that you could explain in a sentence was also lame. Every item above x dollars in the store qualifies as opposed to this does that doesn't. There were $100 dollar items that qualified and $800 that didn't. It made squat sense. What made matters worse was the list changed every month. What qualified last month might not qualify this month. At least if they didn't delete items it would have been easier. Also they should have had financing on Macs. Yes, I know they have ~8 margin, which makes it difficult to make money off them, but if you included the PSC and any other accessorizes in the financing offer a lot of customers would be willing to jump for a Mac and a PSC and maybe an external hard drive for Time Machine. That would be a profitable sale even with the financing offer.  
     
    It is great to be out of Fry's though. Some of the penny wise pound foolish stuff really annoyed me.
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      CommentAuthorSevenup
    • CommentTimeMar 13th 2008
     permalink
    The reason you cant make commission off of other products is pretty straight forward.  
    Everyone would be selling in the Computer department or the AV department because they pay a lot of commission.  
     
    Theres reason why they dont do certain things. They have people 10x smarter than you figuring this out.  
     
    Duhhh.
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      CommentAuthorasdf
    • CommentTimeMar 13th 2008
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    I totally agree with you.  
     
    Fry's machines are junk are have a high failure rate. GQ isn't so bad though because the massive amount of units they move. Though I can personally say I do have a defective GQ.  
     
    Media center pcs really dont make sense. They should be sold at the A/V department. I have never had a customer say they wanted a pc to use it exclusively on their hdtv. The best media servers are the shuttle pcs.  
     
    The store makes most of its money on accessories and it's a huge waste of time for you to sell them unless its really slow and there are no customers to make money on. Time is money so its actually more profitable to ditch the customer after the sale and go on to the next.  
     
    The think I hate is they keep on changing the direction of what needs to get done. One week its wireless, next is coverage, next is frys cards, next is pscs, next is accessorizing. I guess they want all these things done but dont want to do it at the same time.  
     
    They look at the numbers like this,  
    number of salesmen X number of accessories @ 40 points = this amount of dollars  
    number of salesmen X number of wifi installs @ 100 points = this amount of dollars  
    number of salesmen X number of wireless cards @ 22% financing = this amount of dollars  
     
    They care about gp dollars really. Most salesmen look at it as dollars per hour.
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      CommentAuthorm_tux
    • CommentTimeMar 13th 2008
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    I really don't understand how they get 100 points on a wireless install  
    $100 for the install... $10 to the salesperson.. $10+ for the technician to drive to the house.. $4 for gas.. 100 points is an overstatement.. and heavenforbid that the tech makes a mistake and has to drive back out.  
     
    But as a salesperson.. it is the more customers I help, the more money I can make.. not the more things I can make the customer to buy , the more I make because it doesn't work that way.  
     
    Would you like a free printer with that laptop? $0.50-$1.00  
    Did you need a usb cable? $0.10  
    Did you need ink for that printer? $0.50-$1.00  
    Paper? $0.00  
    I sometimes spend 15 minutes selling a customer a laptop but then 20 more with just the accessories to go with it that only net me anywhere from $0.00-$2.10 on a laptop sale that will pay me $30. it's not worth it.. even if the laptop/computer pays nothing it's not worth it because the quicker I end it with this customer I can move on to the next. The only real nice thing to add to a laptop sale is a case.. It's simply not worth waiting and standing around waiting for the customer to say yes or no on a printer that only pays at most $1.. You can mention the printer along the way and they will still wonder if they need it..I'm crushing your head... You flathead!
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      CommentAuthoromfgninjas
    • CommentTimeMar 16th 2008
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    DarkCreep:They have people 10x smarter than you figuring this out.
     
     
    This is really the cute and dry of it.  
     
    As much as I could complain about certain aspects of the store, I sure as shit didn't build a company that made me billions of dollars, so how on Earth could I say Randy Fry and his brothers are doing it wrong? Odds are pretty good that the ECS, GQ and Airlink products are all worth the trouble, otherwise we wouldn't be selling them.  
     
    m_tux:I really don't understand how they get 100 points on a wireless install  
    $100 for the install... $10 to the salesperson.. $10+ for the technician to drive to the house.. $4 for gas.. 100 points is an overstatement.. and heavenforbid that the tech makes a mistake and has to drive back out.
     
     
    You don't understand the points system at all, do you?  
     
    Points = the percentage above cost that something is sold at; it isn't how much profit Randy is putting in his pocket. The system doesn't deduct commissions or any other costs from the points total because really, the whole point of the points system is to show how much money is going back into the store to cover things like commission, hourly, gas, electricity, rent and other expenses of the store.
  3.  permalink
    asdf:I totally agree with you.  
     
    Fry's machines are junk are have a high failure rate. GQ isn't so bad though because the massive amount of units they move. Though I can personally say I do have a defective GQ.
     
     
    The only way Fry's can rationalize their GQ machines is for the people that they bring in that they upsell to a more expensive Compaq and then attach a printer and maybe a PSC as exceeding the negative GQ on the some of the GQ boxes they sell that lose them money. I don't think anybody is going to say they sell GQ for profit they make off of those people they can't upsell to a better brand name.  
     
    The $1 reams of paper I recall were losing Fry's about a $1 a ream and most customers didn't care that the paper that the Willcopy paper was 84 brightness. 84 brightness is terrible, but for most people paper is a commodity so I could never really upsell anyone on brighter paper. We just would lose several hundred dollars a week off paper. If you have noticed Fry's stopped running that promo so often because it was losing them a big wad of cash. I would have stopped running it a long time before they stopped.  
     
    Media center pcs really dont make sense. They should be sold at the A/V department. I have never had a customer say they wanted a pc to use it exclusively on their hdtv. The best media servers are the shuttle pcs.
     
     
    I have never seen a prefab MythTV box in a store have you? So how are you really sure such a device would fail. If you had a box already preconfigured out of the box with tested hardware that works with MythTV that was already set up and ready to go that would make a really sweet DVR box that I could buy and put under my TV. There are a lot of people who are too busy or just don't want the hassle of building such a box themselves that would buy such a box, but almost nobody seems to be trying to sell machines like this. The vast majority of these machines are custom boxes that hobbyists built themselves. Most customers don't want one because they have never seen a HTPC that wasn't ugly that wasn't done by a hobbyist. All the big OEMs like HP don't even know what a HTPC is even supposed to look like never mind what hardware it is supposed to have.  
     
    If you showed most people the power of a MythTV box a lot of people would wonder why they don't see more of these cool boxes on the shelves. Nobody is going to put an ugly tower next to their television.Add to the fact that most of the Media Center have small HDDs and most people are perplexed why they want these "Media Centers." Out of the box they are not only ugly, but they don't have enough storage. That is a none starter for me and a lot of people.  
     
    Furthermore, how can Fry's really differentiate their Fry's PCs? Putting Fry's on the thing isn't the answer. They have tried that again and again and it keeps failing. Some of it is the price points, some of it is hardware, but even if they better price points and better hardware it would still be yet another tower. Other than saying Fry's it would look the same as everything else. Isn't the definition of insanity doing the same thing endlessly and expecting a different result? Isn't that what Fry's keeps doing with the Fry's PCs? About the only way they could really differentiate themselves is to make a budget gaming rig (~$700-800) that had a mid range dedicated graphics card, a cheap business desktop(XP Pro or Vista Business as opposed to consumer Windows versions) or probably the easiest would to simply include an a real install disc in the box as opposed to the BS recovery discs that image the drive back to the original factory condition, which usually has stuff you don't want. Due to all the whining about preinstalled crap there would be a good market for clean installs instead of the garbage they throw on these new machines.  
     
    They have people 10x smarter than you figuring this out.
     
     
    This is really the cute and dry of it.
     
     
    I rather doubt they are 10x smarter than me. And I am not cute either... lol. The biggest thing that separates me or any of a number other people with good product knowledge and enough past experience in retail electronics from creating their own store that would run circles around BB, or CC, or even Fry's is the lack of money to get started. Ideas often times are the cheapest part of starting a business. Convincing people to put money into your enterprise to not only extend your startup money beyond your own limited funds, but actually have enough capital to not only survive, but thrive is the biggest roadlock. Opening a store even half the size of an average Fry's could easily cost over a million dollars just to acquire merchandise! Never mind paying for the building or any fixtures to put products on! At the Fry's I was working at the wholesale value of the laptops that were locked up in the change was usually between $150-350K. During holidays inventory could swell to over $500K in value. (We might have 500-600 laptops with an mean average wholesale value of about $800- Places like Best Buy or to a lesser degree Fry's don't do well because they have great service, but because they have great name recognition and because most people honestly will tolerate mediocrity.  
     
    As much as I could complain about certain aspects of the store, I sure as shit didn't build a company that made me billions of dollars, so how on Earth could I say Randy Fry and his brothers are doing it wrong? Odds are pretty good that the ECS, GQ and Airlink products are all worth the trouble, otherwise we wouldn't be selling them.
     
     
    There are a lot of counterexamples to the notion that people outside of an industry don't sometimes come in and shake up a company and turn it around. The skills to start a company and to take a company to a national powerhouse are different skill sets entirely. I have met Randy before and I sincerely believe that he isn't a stupid guy, but I don't think he knows how to take Fry's to the next level. Some of my criticisms I think is slowly Fry's growth. Furthermore, since neither of us have probably seen Fry's finances (they are still privately held) I don't know whether you should be so confident about their great management skills.
    •  
      CommentAuthorAyaHu
    • CommentTimeMar 20th 2008
     permalink
    Its the CUTE and dry of it.  
    Oh, so cute!Superhero!
    •  
      CommentAuthorSasquatch
    • CommentTimeMar 20th 2008
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      CommentAuthorminolet
    • CommentTimeMar 21st 2008
     permalink
    The whole system of points with items is fabricated unless you work high level at home. The numbers that you see at the store are inflated or deflated so as to insure the best return to the company. Lets say you have a HDD that has 12 points. You sell it and make x gp in the store there is more money that shows up at home office because the numbers are padded once a purchase is made from the vendor. A great example is the vendor sell through that everyone can get an idea of from Sups. Talk to managers and most will tell you they know what it really cost the company to buy most of their products. All companies hide how much stuff cost to the bottom man because its good business.Where you are told illegally to work 20 hours or be fired.....and people believe it.
    •  
      CommentAuthorAyaHu
    • CommentTimeMar 23rd 2008
     permalink
  4.  permalink
    Fugly cat indeed.
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      CommentAuthorSasquatch
    • CommentTimeMar 23rd 2008
     permalink
    That cat is the ballerist cat evar.
    •  
      CommentAuthorAyaHu
    • CommentTimeMar 24th 2008
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      CommentAuthorSasquatch
    • CommentTimeMar 24th 2008
     permalink
    That makes my brain hurt.
  5.  permalink
    Yes, minolet is correct. The margins in Fry's POS (and other retailer's) is false (of course in my opinion =) ). Many vendors give out discounts for early payment, allotments for unsold units, allotments for defective units, buy x get y promotions, spiffs for salespeoples (many times absorbed by the retailer ------ why Mitsubishi made sure to pay directly to the sales associates). Also stock isn't necessarily paid for, certain things are on lease or consignment, and also concessions are made for prices drops. Fry's margins rarely changed, even if the product was over a year old, and the MSRP dropped significantly. This doesn't represent what's really going on, obvioulsy if most people knew what electronics really cost they'd stop shopping all together. Why do you think Fry's clearanced tvs right down to "thousands of dollars negative" back in the day. The KDL60XBR1 (aka the green monster) went down to $499.90 one day after spending ages untouched (even after Sony stopped MAKING SXRD projection units all together!). In the case of the 60XBR1 the margin reflected a cost of something like $3500, obviously making the sale of just one unit $3k negative. Do you think any business would actually do this if that were the case. Lose 3 grand in a single transacton? No they wouldnt, nobody would. This was done by possibly abusing their relationship with Sony and various product allotments for unsold items; regardless though, the cost was nowhere near 3.5 large at that point in time. That might have been the original starting margin, not adjusted what-so-ever for 3 years. Only a sheep, or a really dumb person would believe that Fry's is just so smart, that's just not true. Fry's just has a big bank roll and plenty of reptiles willing to work for them, even if it means doing somewhat dubious things.