Computerland was perhaps the first big computer store to go national. It played an important role in the growth of the computer industry in the 1980s. It faded toward the end of the decade but hung on longer than you might think.
The company’s slogan in the 1980s was “Make friends with the future.”
My experience with Computerland
I remember visiting a Computerland in the summer of 1984. It was somewhere in southern Missouri, in a town big enough to have a business presence. We were shopping for a home computer and frankly didn’t know where we were supposed to look. A store with a name like Computerland made sense to visit, right?
What we found was a lot of business-oriented computers and software. By that I mean expensive IBM PCs, a couple of clones, and some expensive Apple IIs. There was an IBM PCjr on one end of an aisle, but it wasn’t even set up. For a family with young kids looking for a Commodore, Computerland didn’t have anything.
It was a good decade and a half before I crossed paths with Computerland again. Yes, they were still around in the late 1990s. By then they did more computer service than sales. I was in Columbia, Missouri, and when the IT organization I worked for couldn’t or wouldn’t do something, people would call Computerland. Today we call that Shadow IT.
But given the difficulty many small businesses have in finding computer help, I am somewhat surprised that business model doesn’t work anymore.
William Millard founded Computerland in 1974 as a company selling kit computers. In 1976, he put his sales director, Ed Faber, in charge of creating a franchise operation. Faber opened the first store in Hayward, California, under the name Computer Shack, a fairly obvious play on the name Radio Shack. The name changed to Computerland in July 1977.
It was immediately successful. By 1981, there were 190 retail stores operating across the United States, all franchisees. The business model was simple: Provide a full-service experience, selling personal computers, software, and training under one roof, with the computers set up neatly and professionally.
Computerland was one of the three retailers IBM chose to sell the IBM PC in 1981. The match worked well, and by 1985, Computerland had grown to 800 locations, including 200 outside the United States, and made Millard a billionaire. The stores were once common in strip malls in busy commercial districts.
But growth proved elusive after 1985. PCs became a mass-market commodity in the late 1980s thanks to inexpensive clones like those sold by Leading Edge, and consumers started learning they could save a lot of money by ordering a PC from the nascent Dell, or if they really wanted the IBM name, from a gray market reseller. And by the late 1980s, big-box consumer electronics stores like CompUSA, Best Buy and Circuit City were taking over the retail computer market.
Millard sold Computerland in 1987 for $110 million. In 1988, the new owners changed the name of all of the company-owned stores to Vanstar. The company changed hands again in 1997, with Synnex Information technologies purchasing the franchise business. Synnex then sold the operation to Inacom in October 1998 for $480 million. The debt proved crippling and the price was too high for a company whose business model was fading. Inacom went out of business in 2000.
Survival of pockets of Computerland
Since Computerland was a franchise, the franchisees were able to continue operating under the name even after the parent company went out of business. The arrangement was similar to why Radio Shack stores still exist in small towns even though the parent company ceased operations. A franchise that remains profitable and has been operating for decades has little reason to change its name.
Since the business model of surviving Computerland franchises is primarily service, rather than sales, it’s likely any Computerland survivors exist in industrial parks rather than in strip malls today.