“Jean-Louis? You work here?”
It’s Spring 1991. A startled Apple employee finds me behind a cash register at the huge Fry’s Electronics store in Sunnyvale.
“Well, you know…I just got fired…have to make ends meet.”
I’d been working as a cashier at Fry’s for about two weeks, during which time I startled a number of ex-colleagues. But I wasn’t there out of necessity; I was driven by curiosity and genuine pleasure: I’ve always loved retail, and it loved me back.
My “release” from Apple had been a noisy affair that attracted the attention of John Fry, one of the founders (with other family members) of the eponymous Fry’s Electronics. We meet and quite literally talk shop. I tell tales of Apple France, how the benevolent laissez-faire of an otherwise preoccupied senior management gives my unusually capable team the freedom to take care of Apple retailers in creative and effective ways. Our retail marketing and distribution organization quickly becomes the most prosperous outside the US. (More than three decades later, I still get hugs, a relative French rarity, from surviving independent retailers.)
After a few such exchanges, John wonders aloud if I ought to open a Fry’s business in France. I explain that I’m putting together my own startup here in the Valley…but I’d be happy to work at one of his stores while our product is still gestating and fundraising tribulations are yet to start. John smiles and offers to take me on as a cashier at the newly opened Sunnyvale store.
My stint at Fry’s increases my respect for John’s business. Details are meticulously planned and executed, down to the proper way to stack banknotes. Employees are trained in the delicate art of watching for suspicious transactions, how to defuse the situation when some poor lost soul tries to use a stolen credit card to pay for small, expensive articles such as cordless phones, easily traded for substances.
Besides its unusual product mix and the customers it attracted, Fry’s had an unusual (and occasionally controversial) return policy. I personally witnessed a customer service person help a customer return a GPS device. No receipt? What else did you get with that purchase? Gum? The computer finds the transaction, prints a copy of the missing receipt, and the purchase is refunded, much to the surprise of the visiting French customer. Try that in Paris…
Over the next 20 years, Fry’s becomes a phenomenon. Store openings around the Valley, into Southern California, and across the country are media events, each outlet with a particular theme ranging from Ancient Rome (Fountain Valley) to Live Music (Austin), to the Old West (Palo Alto). Going to a Fry’s store is entertainment in itself; for a geek, it could be recuperative. Straight out of Stanford Hospital where surgeons had stitched my carotid artery in 1993, I asked my spouse to take me to Fry’s for a refreshing breath of logic board smell. People I knew did a double take when they saw me, disheveled with Frankenstein metal clips holding the scar on my neck.
But that was a long time ago.
A couple of weeks back, I went to the Palo Alto Fry’s to buy a Microsoft mouse for my 11” iPad Pro (as recounted in the July 21st Monday Note). First surprise, the store that I expected to be active at 8am for its hard-working tech clientèle didn’t open its doors until 10. Worse, what this lover of retail saw inside the store was frightening: bare and half-empty shelves. In the trade, this is a no-no. A store must radiate a happy image of abundance, not one of sad poverty.
A little later, I saw stories in the local press about the upcoming closing of Palo Alto’s Fry’s. I visited the Sunnyvale store where I once worked; it has fared no better: Empty parking lot, empty shelves, bored employees, two customers. The Palo Alto store is no accident, Fry’s has been in serious decline for a while.
What happened? Amazon.
Fry’s rose to its stellar success because it understood and served the tech population. Amazon now does the same job for an enormously broader population and offers a much richer assortment of choices. Type “voltmeter” in Amazon’s search field and you’ll see Fry’s beaten at every rung of the price scale, from $11.88 to hundreds for truly professional Fluke instruments.
There’s another, smaller factor at work: smartphones are the new PCs. An exaggeration, but not by much. Much of the time we used to spend with our PCs a couple of decades ago is now spent with our pocket supercomputers. Some of us, yours truly included, liked to assemble their own PC from parts; no such joy with a smartphone. The shift from PCs to smartphones hasn’t helped Fry’s business.
In the meantime, John Fry was never just about business success. When he saw I had an early edition of Newton’s Principia Mathematica, he opened a safe in his office and showed his collection of original letters from Georg Ohm to Einstein. He told me of his plans to found an American Institute of Mathematics which he wanted to house in a replica of Granada’s Alhambra palace. John hosted a reception at Stanford for Andrew Wiles, best known for finally proving Fermat’s Last Theorem.
About 20 years ago, John took me to visit Dr Amar Bose, founder of the eponymous company in Framingham. After briefly mistaking us for a couple of boring Bose retailers he had to glad-hand, Dr. Bose realized that this was the John Fry, who’s interest in mathematics preceded him. Bose cleared his calendar for the day and took us through a detailed visit of his labs and demos of the technologies he was working on — including suspension development for a German automaker. There were other such trips, including an amusing episode in Tokyo’s Akihabara, a city district best known for its delirious dedication to all forms of electronic vices.
The affectionate memories still glow.
— JLG@mondaynote.com
3 replies (most recent on top)
Interesting articles posted in this thread. Looking past the overly romantic reminiscing by Jean-Louis Gassée of John Fry, I'd personally add that desktop PC demand (and building) started to become more niche in the mid-to-late aughts with the preference for laptops. In other words, the rise of ubiquitous mobile computing started much earlier than the rise of smartphones.
Like the previous reply implies, Fry's Electronics had plenty of time to adjust to competition. It's kinda funny that Amazon et. al. get blamed when Fry's has such a poor e-commerce presence. The stores are just too big for their own good and probably one reason they carry so many irrelevant product categories.
If Fry's could have managed a "hub and spokes" system with online sales to increase catalog size with the spokes being the stores (to handle pick-ups and returns), along with competitive pricing, they could have survived like Best Buy. But Best Buy has competent management these days.
I find such articles funny. John Fry and his brothers were given a million dollars each a long time ago by their father. Thats like me giving you 15 million or more right now. Let that sink in.
A business was started with a fourth person-the actual business person who was not rich so now you know why she was a founder (probably only one who had a clue about things). The business is naturally booming-right location right product at the right time.
Time goes on...no one bothers to update anything. Frys still uses free openoffice btw and got banned for reusing windows 7 keys for repeated overuse. Its programs are based on XP, etc.., so for a leading tech business no money was put back into the business to prepare for the future. Business 101 anyone? Guess our illustrious founders skipped that class.
Amazon didnt ruin businesses. It simply put complacent businesses in its place. If you had anyone hired as your advisor-something a stubborn business owner like Frys didn't do and just did their own rich-kid whimsical things that repeatedly drained the companies money with failing, silly ideas, then they might have told you a while back to update to ten years ago at least, and that online is the growing trend.
Several businesses have adapted. Frys was never adapting, period.
The only irony Im finding is that current successful brick and mortar stores usually have a draw in attraction for buying its other products like groceries. Frys used to have that and ditched it when groceries weren't successful matched with just electronics.
And thus now you know why you see silly things like mattresses and perfume and backpacks sold at Frys. The owners whimsically saw a successful business and tried copying it, again, around ten years + too late.
Current Frys direction IS directly coming from the Frys brothers. The employees are as clueless as everyone else what the heck they're thinking or stubbornly trying to do.
So folks. Business class day 1 course 101. See Frys Electronics. Do the opposite of what John and Randy Fry are doing for success, because their plan is resulting/has resulted in every single customer who cones into the stores wondering only one question. Not if Frys is shutting down. They want to know when the sales start.
Walking into a Fry’s Electronics nowadays is nothing like it was during its heyday in the 1980s and ’90s. There are no long lines at the cash registers. The cafes sit mostly empty, like the store shelves and parking lots.
There are also fewer employees to serve people who still patronize the iconic electronics chain, which was born in Silicon Valley in 1985. Fry’s quirky themed stores, ranging from Western to Mayan, were stocked with just about anything electronic from routers and motherboards to coffeemakers and computers — plus refrigerators, office furniture, perfume, candy bars, “As Seen on TV” merchandise and so much more. The stores quickly became a techie haven and hangout.
For months, customers have been questioning the future of Fry’s, posting photos of empty shelves on social media as employees and experts chime in, blaming everything from the rise of smartphones and competition from Amazon to changing customer demand. Though the company is closing its Palo Alto store, it insists it has no plans to quit the business or close its remaining 33 stores in nine states.
But in recent postings on job sites like Glassdoor, dozens of Fry’s employees have been complaining about the company, with several saying their hours have been cut and that many are now working part time. Because of that, they say many employees have left or are actively looking for other jobs.
Fry’s spokesman Manuel Valerio, who recently said the company is switching most of its suppliers to consignment but is not liquidating or closing stores, did not respond to repeated requests for comment.
Switching to a consignment model means suppliers would get paid for their goods only after Fry’s sells them at its stores.
“It’s often a sign of difficulty,” said Neil Saunders, managing director of analytics company GlobalData’s retail division. “If a retailer cannot afford to pay for product, then there’s a real necessity to go on to a consignment model because it frees up capital.”
Saunders said suppliers might not agree to such an arrangement because they assume all the risk. It is more common for retailers to try to help their cash flow by dragging out their payment periods to suppliers, he said.
Ingram Micro, a known delivery partner of Fry’s, at least at one time, declined to comment, and efforts to reach other suppliers were unsuccessful.
An employee of one company that has done business with Fry’s, who asked to remain anonymous, said that while some manufacturers might be willing to offer their products on consignment, it would depend on how confident they feel in that retailer’s business. In Fry’s case, he said, he would be worried that stores might shut down one day and he wouldn’t be able to reclaim his merchandise.
Mark Cohen, director of retail studies at Columbia University, said the consignment model has traditionally been used for high-margin, slow-turning merchandise like fine jewelry and furs. Consumer electronics is a thin-margin business but is risky, he said.
“Electronics has an obsolescence factor,” Cohen said. Vendors are “probably loath to supply (Fry’s) with goods because they’re worried” about the chain’s future, he added.
The company has said its shelves will soon be restocked and that it is preparing for the holiday season. But it’s hard for current and former employees, customers — and experts — to believe.
Fry’s, whose first store was in Sunnyvale, now has eight stores in Northern California and nine in Southern California, plus eight stores in Texas and two stores each in Arizona and Georgia, and one store each in Illinois, Indiana, Nevada, Oregon and Washington. The company says its Palo Alto location will close in January because its lease is expiring. But it says it plans to keep its other cavernous stores open.
Bryan Boone, who left Fry’s a couple of years ago after nearly 20 years with the company, says he bets “they’re going to go out of business.” But the former facilities manager and construction supervisor thinks the owners of the secretive and privately owned company — the Fry’s family — are trying to keep the stores open as long as possible to avoid paying the costs associated with winding down the business.
John Fry, co-founder and CEO of the company, did not return emails requesting comment.
As customers, employees and fans of Fry’s lament the chain’s current state, many are blaming the rise of online retail giant Amazon — and changing times.
Earlier this month, Jean-Louis Gassée wrote in his popular blog Monday Note that “Fry’s stores have become sad, pale shadows of their glorious past.”
The former Apple executive, who worked briefly at Fry’s as a cashier after being forced out of Apple, said in a phone interview from France that there seem to be fewer people who want to build their own computers in the age of smartphones.
“A large segment of the population has shifted,” Gassée said. “I remember (Netscape co-founder and venture capitalist) Marc Andreessen saying that software is eating the world. A lot of things that were done by hardware modules that people assembled themselves are now integrated into smartphones.”
He added that some people still want to buy electronic modules or appliances from Fry’s. “But the dimensions of the stores and the market need are probably out of sync,” he said.
Longtime Silicon Valley observer and forecaster Paul Saffo agreed.
“Maker Faire is shutting down,” he said. “Fry’s was a watering hole in the middle of the desert. Now (tech) is so mainstream. … Both models are victims of their own success.”
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But Saffo cautioned against counting out the Fry’s family. Brothers John, Randy and David Fry, the sons of Fry’s Food Stores founder Charles Fry, founded the electronics chain along with Kathy Kolder.
“They were ahead of everyone else on knowing what geeks needed,” Saffo said.