What do audio shops need to do to survive ?

Now,if you order something on line from Van Alstine or Odyessey(to name two reliable suppliers),it takes a while for it to be built and delivered. At some point,manufacturing technologies will advance to the point that the interval between order and UPS delivery will be less than a week. When "just in time" delivery of finished goods is possible,retailing possibilites will exist that do not exist now.
I would not attempt to take business from Circuit City or Best Buy;they have too much marketing muscle. What I'd consider would be renting kiosk space at malls during the winter quarter,stocking one of every item I offer,and taking orders for pre Christmas delivery.

what is wrong with 10%

Skyebox, nothing is wrong with 10% over cost, except that many brick and mortar stores cannot keep the doors open on 10% profit over cost. They have all kinds of expenses beyond what they put in their pocket. I doubt that many could exist on that level.

Normally, brick and mortar specialty stores survive by providing services that can't be matched on the Internet or by mail order suppliers. Their overhead is higher, so their prices need to be a bit higher for them to stay in business.

What they normally offer the customer is a venue where they can see and listen to different models within their budget; and a place to return faulty or defective equipment and get it repaired or replaced without the hassles of shipping.

But in today's market I think they need a new gimmick or enticement to help them stay afloat. For example, maybe they could institute a "trade-up" policy, where they will give you something like 80 percent of your purchase price up to 2 years from the date of the purchase toward the purchase of a similar component, provided that component is at least 1.5x the price of the original component.

That is just an off-the-cuff example of a new service that could be enticing to prospective buyers and I'm sure there could be other things that could be done to attract business, such as holding manufacturer seminars and volunteering to host local audio club meetings.

The bottom line is that brick and mortar establishments can't just sit in their shops and wait for business to come to them. They have to adopt a proactive attitude and use their creativity to go out and grab the attention of prospective buyers.

Also, it is beyond my comprehension how certain retailers can afford to be snobbish toward any customer in this type of economic climate. I would think they would need to be as cordial and helpful as humanly possible...

Another thing I thought of is that brick and mortar shops can take advantage of the Internet as well. They should try to set up and maintain a good interactive web presence and maybe employ a clerk who's sole responsibility is to maintain the website, process orders, and field inquiries from the Internet. They could also list and events calendar and special Internet coupons that could be printed out by users and redeemed at the store for additional savings on selected merchandise...

I think retailers who don't take advantage of the Internet's potential are doing themselves a big disservice.