Certainly the internet and places like Amazon, PBK, Wiggle, etc have hurt the LBS industry. But if a LBS is making up for lost sales on marked up tubes and tires by hiring inexperienced mechanics and allowing them to send a poorly assembled bike home, regardless of whether it's $500 or $15,000, it is 100% on the LBS, not the consumer's choice of retailer.
Surely (and please correct me if I'm wrong) labor makes up a substantial part of the LBS bottom line. $25 for a flat change (can do 10 an hour), $75-100 for a tune up (1-hour max), $150+ for assembly (maybe 2-3 hours), $60 to box a bike for shipment (30 minutes?) etc. Of course all take man-hours, but at the assumed $15/hr, or even at the high end $25/hr, the LBS is still making a ton on service and not passing it down to the mechanics. And from what I can tell, LBS mechanics' time is in high demand. The last couple times I called my LBS up for something I just didn't want to deal with, they gave me a 4-5 day turn-around estimate. I ended up buying the tool and doing it myself. Now I have the tool and will never call them again.
I think the idea that LBS mechanics _should_ be poor and you should bribe them for favors or priority for beer is something that LBS owners take advantage of. Charge a little less margin on those tires, gels, tubes (though I'm 100% tubeless now), and other consumable things I need on a regular basis, and pay/retain good mechanics that don't have a queue two weeks deep and I'd start having them do more of my work.
Probably unpopular, though maybe not to the WW crowd, opinion: Wrenching on a bike is easy. Outside of things that are potentially catastrophic if done wrong, doing most things on a bike, even high-end electronic groupset internal-cable bikes, is doable with a set of allen wrenches, end wrenches, and youtube. Even the super scary things like pressing bearings, cutting steerer tubes, and bleeding hydro brakes are easy if you're careful. The idea that an LBS is charging someone $75+ to run new cables is ridiculous. Most I've seen charge for materials separately. It's not surprising that once you do it yourself, people are reluctant to have the LBS do it again, and start to wonder what else they can do themselves to save money. Once they realize it's _nearly everything_ AND the internet has parts for 30% less, it's easy to see why LBSs are in trouble.
I'm not arguing it _should_ be this way. The big manufacturers and distributors are undercutting their own LBS partners every chance they get and that sucks. I wish they didn't have to compete with their own suppliers on the internet. But things are as things are.