small tech

Online shopping may be bad for small tech.

Farewell Toys ‘R Us.

If you’ve been around even a little while, you know that the price of the extraordinary economic dynamism of the United States is that things that once seemed permanent…aren’t. There are no new Oldsmobiles rolling off the GM lines. Marshall Field’s is long gone. And now, we’ve said adios to Toys ‘R Us, at least for now.

The iconic toy store chain shuttered its last stores last week, throwing thousands of people out of work. A CNBC report on the closure points out that the name may come back to life at some point, bought and revived by Target or Amazon.com.

That might be nice to see for those of us with an occasionally nostalgic outlook.

But even if Toys ‘R Us comes back in some form or fashion, it won’t change the overall picture for brick-and-mortar retail. That’s just grim, thanks to the dynamism we mentioned earlier. It’s just often more convenient to shop online than in person.

When we lose that brick-and-mortar store, though, we may be losing more than we think. Some of what we lose is an avenue for high-tech innovation, for the small upstarts to take on the tech Goliaths.

That’s a case Jeremy Case VentureBeat makes at VentureBeat, writing:

The closure of these retailers will disproportionately hurt small tech companies. It’s one thing to be Apple, which could still outsell OnePlus even if Best Buy, Costco, Target, and Walmart all went out of business, thanks to its 500+ retail locations and carrier stores. Apple is selling premium products, has flexibility in pricing, and can roll with pretty much any change in the broader retail environment. If more sales shift online, it’s covered. Ditto if local sales increase; it can just hire people away from failing competitors.

Without some sort of local brick-and-mortar safety net, however, smaller tech companies are going to be in trouble. They’ll be entirely dependent on online sales, a market that’s only becoming more crowded and competitive every day. For software companies and service providers, YouTube videos or in-home trials may compel purchases. But when it comes to buying hardware — as with clothes, foods, and other things that are really best experienced in person — making a smart choice online is not that easy.

And such an atmosphere where the little guys don’t get a chance to shine isn’t good for anybody.