I bet they don’t try to compete on price with Wal-Mart and similar. They are likely selling services and not products or are differentiating their products to sell to a more discerning customer. There is no way I can really a beat a big box store when it comes to price. You have to go at it a different way. I routinely setup systems bought at big box stores. I make barely any, if any, money selling actual products. All my profits are in the service so I don’t really care if they get the product from me or somewhere else for cheaper.
We have at least 4 such services in a town of about 20,000 as well. There are two that more focus on businesses and higher end residential customers and then two that cater to cheap. One of the cheap ones is a complete ripoff artist. The other means well but I don’t see how the business model will work. He takes refurb computers and sells them super cheap. I think he may have some decent deals in there but I he has no money to advertise and constantly has to deal with price-point customers.
We also have a Fastenal store here in town when it comes to tools and odd parts. Sure, they are expensive but fill a niche that the Lowes almost directly behind it does not. The farm stores are somewhere in the middle. They don’t have quite the selection but the prices aren’t as high either.