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Ted Drewes, CompUSA and Dell-Mart

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I stopped by the Ted Drewes today, the best Ice Cream place in St. Louis. Surprisingly, it only has two stores in St. Louis, and the owners intentionly kept it that way. In other words, they don’t want to grow into Hagen Dazs, or something like that. By keeping it small and community-involved, they provided ice creams for St. Louisans and visitors since 1931. Today I saw the sign, where the Mayor of St. Louis declared Feb 17 as “Ted Drewes’ Day”. WOW.   

Ted Drewes

On other hand, I also drove by CompUSA, the mega computers and gadgets store, it was closed for good. The one reason, among other things, is the razor thin profit of computers. Did you noticed in all the new Bestbuy stores, they moved the flat screen TVs at the right front (the best spot in store), where they used to put up computers? 

Last week, Dell annouced its partnership with Wal-Mart, its first retail channel since 1993. Will this Dell-Mart thing help Dell computer in some meaningful way? I am doubtful like many others.

Big means powerful in many occasions, but over capacity could kill the profit of the industry. For me, I would rather run the Ted Drewes than the Dell Computer. Another good example is the Krispe Creame donuts couple years ago. When the donuts are shown up in the grocery store and gas stations, it was losing the uniqueness or coolness it once had.

So the key is “grow without dilute the brand”?

2 replies on “Ted Drewes, CompUSA and Dell-Mart”

That’s interesting. I think in China, every company wants to grow as big as possible, they can benefit from from the economies of scale. And I think another particular reason is if your product doesn’t require unique and sophisiticated technologies that block others from coming in, the industry is easy to be over capacity. So, only big guys survive.And that’s what happening in China. Besides, the poor intellectual property protection in China contributes to it.

Yes. What you described “in China, every company wants to grow as big as possible, they can benefit from from the economies of scale” is accurate.

But here in the US, in addtion to the economy of scale, i.e., the Wal-Mart and Dell model, there are still many opportunities for small businesses. Ted Drewes is just one example. I think restaurant, bread and coffee is a place the owner can add a personal touch and make it unique. Another good thing is they can avoid “compete against China” by this food business.
I think Trader Joe is also another good example of “being unique and profitable” in the grocery business.

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