The Yin and Yang of American Consumers
By Denny Hatch
A guy I know bought two Fedders air conditioning units and a VCR from American Appliance, an independent discount appliance chain in my area. One of the machines didn't work, and he phoned the store. The line was perpetually busy.
He went to the store during regular hours and was told the store was closed. "When will it be open?"
"I am telling you, the store is closed," was the reply.
It turns out GE Capital called in its markers, and the 33-year-old, privately held American Appliance instantly shut all 24 stores and fired its 700 employees. For The Philadelphia Inquirer newspaper, Linda Loyd and Jeff Gelles wrote:
It was unclear whether appliances would be delivered to customers who had paid for them recently and whether those who had bought extended-warranty or service contracts would get their money back.
Think of it: You buy an appliance and don't get delivery. You step up for an add-on service contract, and your money is stolen from you!
In the early 1990s I bought a laptop computer at Computer City, a Tandy operation in Cherry Hill, NJ. Two years later I bought a better Apple laptop from that same outfit, together with a warranty service contract that cost me an extra couple of hundred bucks.
A month later, I stopped by Computer City to pick up some supplies, and the store was shuttered and vacant. Tandy, with its vaunted customer database (at that time you couldn't buy batteries from Radio Shack without surrendering your name and address), didn't write me to say the Cherry Hill store was closing and that my nearest Computer City was at such-and-such an address. Just left me—a customer who had ponied up several thousand dollars—hanging out to dry. The next time I heard from anyone at Tandy was two years later when they wrote that my service contract was up for renewal.