PC parts retailer NCIX files for bankruptcy after closing physical storefronts

Last Friday, Netlink Computer Inc., better known to DIY system builders as NCIX, filed for bankruptcy in Vancouver, Canada, after shuttering the last of its brick and mortar stores. It's not clear what exactly led to this point, though it's quite possible the company focused too much on its physical stores and not enough on its web business.

Some companies have had a hard time fully embracing the online sales model after thriving for some time with physical storefronts. It didn't seem likely that NCIX would make that mistake. It began as a walk-in retail business when it was founded in 1996 by Steve Wu in Burnaby, British Columbia, but started selling products online a year later.

Over the years, NCIX expanded by opening several physical stores. It also built a bigger presence in the United States, though it faced stiff competition from Amazon and Newegg. According to Anandtech, that's the reason why NCIX poured more resources into opening offline stores, rather than investing more in warehouses and distribution centers for its online business.

That said, NCIX did set up a distribution center in the US in 2011. However, it hasn't been nearly as aggressive as Amazon or Newegg in the online space. Linus Sebastian from Linus Tech Tips stated in a YouTube video that this is one of the reasons why he left the company several years ago, after advancing about as high as a person could. He also criticized upper management. Skip ahead to the 41:40 mark to hear all of what he had to say:

NCIX is a privately-owned company and doesn't share financial results with the public. As a result, we have no idea how much money the company might have been bleeding, or how long it's been financial trouble. However, we do know that NCIX closed all of its retail locations this past July, followed by more locations in BC. By the end of November, NCIX had shut down all of its stores.

There's also a forum post dated September 8, 2017, in which NCIX indicates a restructuring effort.

"As many of you have noticed, NCIX is currently going through a restructuring to give us more flexibility to compete in the online market. This has lead to some store closures and refocusing our resources for online sales, as well as prioritizing our more high traffic locations," NCIX said at the time. "While the restructuring continues, some shipping delays may occur, but we are working hard to ship out all orders as soon as possible."

NCIX's website is still active with a holiday sale that runs through December 6. Given the recent bankruptcy filing, we'd be wary of ordering, at least until NCIX publicly addresses the situation.