CompUSA to Cut Workers by 7%, Expand Its Electronics Offerings

CompUSA Inc., the nation’s largest personal-computer retailer, said Thursday that it will slash its work force by as much as 7% and add consumer electronics to its merchandise mix to rely less on low-profit PC sales.

CompUSA also said it will close as many as 14 of its 211 superstores and hire an outside distributor to fulfill bulk PC orders in its reorganization designed to boost sagging profit. The various moves will eliminate as many as 1,500 of its 21,000 jobs and result in charges of as much as $50 million, or 54 cents a share, in the fiscal fourth quarter, the retailer said.

CompUSA posted a loss or declining profit in each of the last five quarters. It’s been hurt by falling PC prices and competition from online retailers, consumer electronics retailers and direct PC sellers.

Dallas-based CompUSA is the only U.S. retailer operating superstores devoted mainly to selling PCs. It bought its main rival, Computer City, from Tandy Corp. last year.

The retailer is looking for ways to boost sales as PC prices have continued to fall, analysts said.

The company said it’s testing new store layouts at certain locations. All stores will see changes in merchandise categories by the holiday shopping season, though computers will still make up the bulk of the business, CompUSA said.

CompUSA’s shares fell 50 cents to close at $7.69 on the New York Stock Exchange.