In my experience (I think there's some regional variation here) they were still thriving in the mid/late 90s, and I continued to frequent local computer shops until around the mid aughts. For me, there were three major factors: computers got more standardized, so one didn't need to consult a guru to make a decent system; documentation went online, see above; and finally companies like NewEgg just crushed it in terms of inventory that local shops couldn't compete with. They could special-order whatever parts you wanted, but that was slower and more expensive.
