Well, that is the kind of store that is clearly also not existing in Canada, certainly not as a chain. Why wouldn't it exist in the US?
In terms of why it no longer exists in Canada, there are clearly a number of factors. Factory Direct bought refunded-returned items from Best Buy and Amazon and Staples and whatnot for pennies on the dollar (an exaggeration), engaged in cursory inspection, discarded any items that were clearly too broken to sell, and put the rest on the shelves. A $800 smartphone retailed for $400, and went down by $50 a year, and Factory Direct made a good profit on that for a long time.
I personally never had a bad experience, but some Factory Direct customers reported that their products were defective and had to be exchanged repeatedly to get a working item. I suspect that Factory Direct's inspections of their inventory were limited, and they relied on customers exchanging defective items rather than pre-sale quality control.
For a long time, their sales were strong enough to withstand it, but Factory Direct may have built a bad reputation if too many customers had too many exchanges to the point where customers started paying more money elsewhere so that they wouldn't need to do repeated exchanges.
In 2020, Factory Direct probably saw increased sales of electronics due to people staying home, and may have overpurchased in anticipation for rising sales in 2021 - 2022 only for inflation to hit hard in 2023.
There's the fact that Factory Direct couldn't really raise their prices very much. If refurbished products go up in price, then the value of buying refurbished versus new is eliminated. Also, in 2023, Factory Direct's main customers were probably shopping there less. People on already low budgets who were now finding anything from Factory Direct now too expensive for them and viewed Factory Direct as a luxury.
People with more disposable income had probably always bought the full-priced latest and greatest. People who were tech-savvy enough to see Factory Direct for the great deals that it had may have also preferred to buy their items from online retailers who shipped products directly to buyers' homes and didn't require an in-store visit.
The people who once turned to Factory Direct for affordable tech were probably not buying any tech at all. In addition, Factory Direct didn't own its locations; it was renting those properties, and the rent against diminished profit led to an unsustainable situation.
Personally, I think Factory Direct offered amazing value, selling 2 - 4 year old smartphones that were so powerful that they wouldn't really suffer in terms of performance, while admittedly missing out on the latest screen refresh rates and low light camera lenses of newer technology. What could Factory Direct have done to survive?
They might have considered ending their existence as a bricks and mortar shop and taken their business entirely online, although it would have required more extensive review of their refurbished goods to avoid wasting shipping costs on exchanges.
They might have been able to focus exclusively on phones, tablets, laptops and desktops. Factory Direct was probably wasting its shelf space and time on selling blenders, coffeemakers, kettles and ice cream makers.
In a world of $2,000 smartphones, laptops and desktops, Factory Direct might have been able to carve out a niche in offering $300 - $800 prices on phones, tablets, laptops and desktops that were refurbished, 2 - 6 years old, not the latest and greatest, but affordable and good enough to run the latest and greatest software and apps even if the hardware was a little aged.
I wonder where I'll go now to find refurbished items.
Refurbished electronics (in the USA) is a tough business. I actually have read about a few that do okay out in rural areas that don't have many big boxes. The parts and labor to fix broken items often doesn't make sense. However, there are a ton of these business out in Brooklyn, NY, for instance, but they are entirely run out of warehouses, and often deal with parts imported from China. If it doesn't work, you stick it back in the box and mail it back, and they probably toss it. In any case, ditching the retail piece probably saves quite a bit of money.
I have several friends who operate video game stores where they do repairs, but you're also talking about electronics that can be decades old by now.
In other news, HP wants to stop selling bubble jet printers and start renting them to customers at about $36 a month for 700 pages and charge you $270 if you want to cancel your two year subscription. Wade Welles would advise that you skip this deal and buy a laserjet.
Given how little people print these days, it's another rough business to be in. You are kind of forced to make this stuff up. For years they've taken a bath on the hardware, with the hopes of sticking ppl with exorbitant ink and toner charges. I presume this was their last lifeline.
