Krazy Krazy

Last updated

Krazy Krazy Audio Video Warehouse was a Canadian retailer of consumer audiovisual electronics. [1] In operation from 1983 to 2009, the chain began to decline in the late 1990s and 2000s due to the changing consumer electronics market. Although no longer operating as a national chain, a few former franchise locations remain in business as independently operated local stores. [2]

Contents

Background

The company was established in 1983 by Michael McKenna and Daniel Behune, opening its first location in Vancouver, British Columbia. [1] It soon began expanding nationally, both by opening new company-owned locations and through a franchise deal which resulted in the rebranding of Windsor businessman Bill McKay's existing McKay's Television and Appliances chain. [3] However, the franchise deal led to some friction: as McKay's franchised company had a stronger credit rating than the McKenna-Behune parent corporation, the chain was ordering all of its appliances through McKay, who tried to petition McKenna and Behune's company into receivership in 1987 over unpaid revenue compensation. [3] The deal resulted in a split between the two companies, with McKenna and Behune rebranding their stores as Multitech Warehouse Direct, [4] while McKay became the sole owner of the Krazy Krazy brand name thereafter.

Krazy Krazy

Under McKay's ownership, the chain served markets in Ontario, Manitoba and Alberta, with 20 locations at its peak. [5] It was sued by Alberta's provincial Ministry of Consumer and Corporate Affairs in 1989 due to allegations of false advertising, including bait and switch tactics under which customers who wanted to purchase a product at the advertised price were allegedly pressured to purchase a similar but higher-priced product instead, and allegations that the firm was advertising "no interest" sale prices which had interest already hidden in the advertised sale price. [6] The company denied the claims, instead asserting that virtually all of the complaints that had been filed resulted from other electronics retailers trying to compete with Krazy Krazy by buying products at Krazy Krazy's special sale prices in order to resell them at a markup. [7]

In the 1990s, the firm began closing some of its stores, with its Calgary location closing in 1992 [8] and both of its stores in Sudbury closing in 2000. [9] By 2009, the company's largest remaining stores, in Winnipeg and Thunder Bay, were closed. [2] The only remaining remnants of the company as of 2018 are the former stores in Sydney, Nova Scotia and Timmins, Ontario, which both retained the Krazy Krazy name when they were bought out by local owners; [10] and the company's former car audio specialty store in Winnipeg, which was bought out by two former employees and now operates as Krazy's. [2]

Multitech Warehouse Direct

Soon after the split of the original Krazy Krazy franchise agreement resulted in McKenna and Behune's stores being rebranded as Multitech Warehouse Direct, a break-in at Multitech's store in Ottawa resulted in the theft of $30,000 of merchandise. [11]

Multitech Warehouse Direct grew more rapidly at first than McKay's Krazy Krazy, reaching 52 stores in seven provinces across Canada at its peak in 1993. [1] In that year, however, it signed a deal as the exclusive Canadian distributor of Magnavox products, which locked it into purchasing $25 million worth of inventory per year regardless of actual sales; [1] at the same time, its early forays into selling computer products were unsuccessful. [1] The company also had a rocky relationship with Sony, buying Sony products on the grey market in the United States to get around Sony Canada's unwillingness to maintain direct business dealings with Multitech; [1] culminating in a 1993 court case after Sony Canada alleged that Multitech was advertising Sony products at deeply discounted prices, but training its sales staff to disparage the Sony products as defective and not worth purchasing, and instead steering customers to higher-priced competing products. [12]

Multitech was placed in receivership, and its assets liquidated, by 1996. [13]

Related Research Articles

Sears Canada Defunct Canadian department store chain

Sears Canada Inc. was a publicly-traded Canadian company affiliated with the American-based Sears department store chain. In operation from 1952 until January 14, 2018, and headquartered in Toronto, Ontario, the company began as Simpsons-Sears—a joint venture between the Canadian Simpsons department store chain and the American Sears chain—which operated a national mail order business and co-branded Simpsons-Sears stores modelled after those of Sears in the U.S. After the Hudson's Bay Company purchased Simpsons in 1978, the joint venture was dismantled and Hudson's Bay sold its shares in the joint venture to Sears; with Sears now fully owning the company, it was renamed Sears Canada Inc. in 1984. In 1999, Sears Canada acquired the remaining assets and locations of the historic Canadian chain Eaton's. From 2014, Sears Holdings owned a 10% share in the company. ESL Investments was the largest shareholder of Sears Canada.

Sobeys Inc. is the second largest supermarket chain in Canada, with over 1,500 stores operating across Canada under a variety of banners. Headquartered in Stellarton, Nova Scotia, it operates stores in all ten provinces and accumulated sales of more than C$25.1 billion in the fiscal 2019 operating year. It is a wholly owned subsidiary of Empire Company Limited, a Canadian business conglomerate.

Future Shop was a Canadian electronics store chain. It was established in 1982 by Hassan Khosrowshahi. By 1990, the chain had become the country's largest retailer of computer and consumer electronics. In January 2013, the company operated 139 locations across Canada.

Best Buy Consumer electronics retailer

Best Buy is an American multinational consumer electronics retailer headquartered in Richfield, Minnesota. Originally founded by Richard M. Schulze and James Wheeler in 1966 as an audio specialty store called Sound of Music, it was rebranded under its current name with an emphasis on consumer electronics in 1983.

Eatons Canadian retailer

The T. Eaton Company Limited, later known as Eaton's, was a Canadian department store chain that was once the largest in the country. It was founded in 1869 in Toronto by Timothy Eaton, an immigrant from what is now Northern Ireland. Eaton's grew to become a retail and social institution in Canada, with stores across the country, buying-offices around the globe, and a mail-order catalog that was found in the homes of most Canadians. A changing economic and retail environment in the late twentieth century, along with mismanagement, culminated in the chain's bankruptcy in 1999.

The Warehouse Group New Zealand retail group

The Warehouse Group (TWG) was founded by Stephen Tindall in 1982, and is the largest retail group operating in New Zealand. It is a corporate group that consists of The Warehouse, Warehouse Stationery, Torpedo7, Noel Leeming, 1-day and TheMarket.

Lafayette Radio Electronics Corporation was an American radio and electronics manufacturer and retailer from approximately 1931 to 1981, headquartered in Syosset, New York, a Long Island suburb of New York City. The company sold radio sets, Amateur radio (Ham) equipment, citizens band (CB) radios and related communications equipment, electronic components, microphones, public address systems, and tools through their company owned and branded chain of retail outlets and by mail-order.

Giant Tiger

Giant Tiger Stores Limited is a Canadian discount store chain which operates over 260 stores across Canada. The company's stores operate under the Giant Tiger banner in Alberta, Manitoba, New Brunswick, Nova Scotia, Ontario, Prince Edward Island and Saskatchewan; under the GTExpress and Scott's Discount banners in Ontario only, and under the Tigre Géant banner in Quebec.

Gordon Reid is a Canadian businessman. He is the founder of Giant Tiger, Canada’s third-largest chain of discount stores.

Consumers Distributing was a catalogue store in Canada and the United States that operated from 1957 to 1996. At its peak, the company operated 243 outlets in Canada and 217 in the United States, including stores in every province in Canada and in the states of New Hampshire, Massachusetts, Connecticut, New York, New Jersey, Pennsylvania, Maryland, California and Nevada.

The Source Electronics Inc., doing business as The Source, is a Canadian consumer electronics and cell phone retail chain. The chain goes back over 40 years in Canada, initially as Radio Shack and later as The Source by Circuit City. The Source is now owned by BCE Inc., which purchased the assets of InterTAN from its parent, American retailer Circuit City, in 2009. The Source is a unit of 4458729 Canada Inc. and is based in Barrie, Ontario.

The Brick

The Brick Ltd. is a Canadian retailer of furniture, mattresses, appliances and home electronics. The company was founded as The Brick Warehouse LP by brothers, John, Fred, and Bill Comrie. The first warehouse opened on September 1, 1971 in Edmonton, Alberta. Its first expansion was to Fort McMurray, Alberta in the 1970s and later acquired a competitor in the city of Calgary.

Service Merchandise was a retail chain of catalog showrooms carrying jewelry, toys, sporting goods, and electronics. The company, which first began in 1934 as a five-and-dime store, was in existence for 68 years before ceasing operations in 2002.

Silo (store)

Silo was an electronics retailer operated throughout the United States between 1947 and 1995. The western region stores were known for a number of years as "Downings" in Colorado and "Appliance-TV City" in Arizona and California.

Fretter was an electronics and major appliance retailer based in Detroit, founded in the 1950s by Oliver "Ollie" Fretter.

A&B Sound Defunct Canadian home electronics retailer

A&B Sound was a Canadian home electronics retailer based in Vancouver, British Columbia. Its flagship store was located in downtown Vancouver, and the chain expanded to other cities in B.C. and in western Canada, but the company began struggling in the 2000s decade and collapsed altogether in 2008.

Gamble-Skogmo

Gamble-Skogmo Inc. was a conglomerate of retail chains and other businesses that was headquartered in St. Louis Park, Minnesota. Business operated or franchised by Gamble-Skogmo included Gambles hardware and auto supply stores, Woman's World and Mode O'Day clothing stores, J.M. McDonald department stores, Leath Furniture stores, Tempo and Buckeye Mart Discount Stores, Howard's Brandiscount Department Stores, Rasco Variety Stores, Sarco Outlet Stores, Toy World, Rasco-Tempo, Red Owl Grocery, Snyder Drug and the Aldens mail-order company. In Canada, retail operations consisted of Macleods Hardware, based in Winnipeg, Manitoba, and Stedmans Department Stores, based in Toronto, Ontario. Gamble-Skogmo carried a line of home appliances, including radios, televisions, refrigerators, and freezers, under the Coronado brand name.

ABC Warehouse, Inc. or ABC Appliance, Inc. is a chain of retail appliance and electronics stores based in Pontiac, Michigan. It was founded in 1963 by Gordon Hartunian, and operates 42 stores in Michigan, Ohio and Indiana. The chain also operates 16 Mickey Shorr Mobile Electronics stores and 2 Hawthorne Home Appliances & Electronics stores. They are known for their advertising motto "The Closest Thing To Wholesale". In the last few years ABC has added mattresses and furniture to their retail offerings, including products from Sealy & Lane.

Safeway is a Canadian supermarket chain of 135 full service supermarket stores in Western Canada. It was established in 1929 as a subsidiary of the American Safeway Inc., before being sold in 2013 to Canada's second-largest supermarket chain, Sobeys, a division of the conglomerate Empire Company. It is now independent from the American company as a result but continues to use the same Safeway name and logo.

Sunrise Records and Entertainment Ltd., operating as Sunrise Records, is a Canadian record store chain based in Ancaster, Ontario. Currently owned by Douglas Putman, it currently operates in nine Canadian provinces. Originally operating with only 9 locations in Ontario, the chain announced a major expansion in February 2017, under which it purchased leases for 70 locations formerly occupied by HMV Canada. The chain runs approximately 85 locations across Canada.

References

  1. 1 2 3 4 5 6 "Not insane, just unsustainable". Profit , December 1, 1996.
  2. 1 2 3 "St. James audio-video store latest in chain to shut doors". Winnipeg Free Press , January 31, 2009.
  3. 1 2 "Krazy Krazy has to pay in appliance chain dispute". The Globe and Mail , May 23, 1987.
  4. ↑ "Krazy Krazy too common for Multitech". Ottawa Citizen , May 26, 1987.
  5. ↑ "Krazy Krazy charged with illegal advertising". The Globe and Mail , March 23, 1989.
  6. ↑ "Krazy Krazy electronics store denies misleading-ad charges". Ottawa Citizen , March 30, 1989.
  7. ↑ "Electronics retailer denies `bait and switch' allegation". Edmonton Journal , March 29, 1989.
  8. ↑ "Krazy Krazy`s forced to close its only store in Calgary". Calgary Herald , February 1, 1992.
  9. ↑ "Krazy Krazy stores are closed". Sudbury Star , March 29, 2000.
  10. ↑ "Craig Salmonson’s gone fishin’". Timmins Daily Press , July 24, 2012.
  11. ↑ "Thieves were Krazy Krazy like a fox". Ottawa Citizen , September 28, 1987.
  12. ↑ "Court hits bait-and-switch tactics". Financial Post , May 18, 1993.
  13. ↑ "Electronics retail chain shuts doors". Edmonton Journal , February 28, 1996.
This page is based on this Wikipedia article
Text is available under the CC BY-SA 4.0 license; additional terms may apply.
Images, videos and audio are available under their respective licenses.