RealTime IT News

Good Guys Plunges into E-Commerce

Electronics retailer Good Guys Wednesday created a new subsidiary to spearhead its electronic commerce efforts.

The company announced plans to create a new dot-com company, GoodGuys.com Inc., that will lead the chain's e-commerce efforts. No definite launch date was released, but the company said it could come before the end of the second quarter.

Good Guys will retain 49.9 percent control of the new company, and other undisclosed investors will control the remaining equity. The company is currently seeking an e-commerce partner to develop and host the site, and expect to announce an alliance by the end of the month.

The company is calling its dive into the dot-com world a "logical extension" of its position as a purveyor to the high end of electronics market. According to Ronald A. Unkefer, Good Guys' (GGUY) founder, chairman and chief executive officer, GoodGuys.com will offer digital products, Net appliances and consumer entertainment electronics from the same sources that supply goods to its bricks-and-mortar stores.

"Studies by Web site research firms suggest that consumers would rather shop online with familiar names than with unknown, mass merchandising e-tailers lacking physical store locations," said Unkefer.

"By creating a separate company dedicated to electronic commerce, Good Guys can reap all the benefits of a branded electronic commerce site, without assuming the associated financial risks and obligations."

The Good Guys chain operates in California, Washington, Oregon and Nevada. The company reported Tuesday its aggregate sales were down nearly $30 million from last year. However, officials remain optimistic that recent strategy shifts will lead to a recovery.