Tiny is abandoning a three-year effort that saw the company open more than 40 stores in malls along the West Coast, from the state of Washington to Southern California. The company has already shuttered most of the outlets and plans to close the remaining seven within a couple of months, according to Phil Morris, chief operating officer of the company's U.S. operations.
"In the U.S. we're just watching diminishing sales as a result of a terrible PC industry," Morris told CNET News.com.
Morris stressed that the Surrey, England-based company is not abandoning the U.S. market and said Tiny will continue to sell PCs over the phone and through its Web site. The company had said it hoped to open 250 U.S. stores by 2002.
After more than 15 years in business in Britain, Tiny opened its first U.S. store in the Seattle area in late 1998. By the end of 1999, the company expanded to Portland and the San Francisco area and last year opened stores in Los Angeles and Orange County, Calif.
Morris said the retail effort had at first been quite successful, but things headed south with the rest of the PC industry late last year.
"We were doing very well right about until last September," Morris said.
Morris is not optimistic that things will get better anytime soon, either.
"When will the market return? It could be as far away as 18 months from now," he said.
The stores remaining open, for now, are in Auburn and Tacoma, Wash., as well as the San Francisco Bay Area communities of Pleasanton and Concord and Southern California locations in Glendale, Montebello and Ontario.
Morris said he does not think his company will be the last that finds it needs to cut stores to compete with the likes of Dell, predicting that Gateway may close more of its Gateway Country retail outlets. Gateway has already shuttered at least 10 percent of its U.S. stores.
"I'm interested to see how Apple gets on with its store openings," Morris said, adding he wishes the Mac maker well but thinks retail outlets could be a money-losing proposition. Apple this week is opening a store near Dallas, the third of 25 outlets it plans to open this year.