The three-year effort by Tiny Computers to duplicate its UK success in the US has been canned. The company is closing all 40 retail outlets which it opened along the US Pacific coast.
Phil Morris, Tiny's US chief, blamed the closure on the fact that the PC market in the US has ground almost to a standstill. "Our sales declined along with the general PC market," he said.
Statistics from market research company IDC backed him up as it reported recently that PC shipments for the second quarter in the US declined 8.1 per cent from 2000.
Dell has begun a price war to win market share at the expense of Gateway in the consumer arena, and Compaq, Hewlett Packard and IBM in all other markets. Gateway has also decided that it cannot sell via retail outlets and is closing many of its "Country" stores.
Tiny's sales failed to make the company a top-tier player in the US - it was always lumped with 'Others' in the IDC research - and was inevitably hurt by the aggressive sales tactics of the major players.
John Sonego, an executive at Rogers & Associates, which last year handled Tiny's public relations account, was not surprised to hear that the company was pulling back.
The US is a mature market and Tiny had lots of big name competitors. "While Tiny was competitive in terms of price and product, there were just not the buyers around. In the US, numbers of that first time customer are very limited," he said.
As for the future, Morris is not coming back to the UK. Tiny is going to look at other ways of selling its machines, possibly by phone and via the internet.
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