I ask because sometimes it seems pretty random and other times it seems like things on the one end or the other are more likely to fail. What do you think, especially considering some places are effectively sharing a niche like Target vs Walmart?
To be honest, I don't think either upscale or lowscale businesses will be going out of business. We had a recent study up here in Canada and it showed that Generation Y purchased the most luxury items than any other age bracket. However, people, like myself (24), who want to save money, will go to a "lower scale" business to get the best possible price on an item.
I don't bother reading on about generational differences, because no one seems to know what generation is which. More over Kmart is endangered (low scale) but so are things like Best Buy (could read either way).
I don't think it's a matter of upscale or lowscale, but a matter of online vs. in-store. Online is dominating the market, which is putting upper and lower class stores out of business. Upon first reaction it's natural to go with lower scale businesses, but as you stated Best Buy is having a hard time paying the bills. They could be out the door just like Circuit City. Really no one is safe from going out of business.
Is online really dominating the market? They might work okay if you have internet, a good computer, credit cards or paypal, and the time to wait - otherwise most folks are going to frequent the brick and morter store.
I agree that part of it is the online market. Another part is changing technology - people going to e-books instead of hard copies, streaming video on their computers, stuff like that. I think that the way the company is run makes a difference, too. For example, last year Best Buy had some great deals online for the Black Friday sales. I'm not sure what exactly happened, but there were people who ordered and then figured they had finished their Christmas shopping. Then Best Buy was unable to fill all the orders, and they waited until very close to Christmas to let many of the buyers know this, which meant some of then were unable to find the product they thought they had already bought. Many of those people will think twice before buying online from Best Buy again, and I think that will really hurt them this next year unless they make some changes to assure customers that they know what they are doing. The other type of business that I think is in danger is the small mom and pop business. Unless they can come up with something - like great customer service - that distinguishes them, they have a hard time competing with the big stores. I think competition is good for everyone, so I try to shop these stores when I can.
I do like mom and pop shops, but I classify them under small business and I think overall they are doing fine. With the internet there to support them there is no need for a brick and mortar store endanger of going out of business.
