Best Buy to close 50 US stores, cut costs

[OverDone]

Source: Sac Bee

Best Buy Co. is closing 50 stores in the U.S. in fiscal 2013 and is looking to cut costs by $800 million by fiscal 2015.





Read more: http://www.sacbee.com/2012/03/29/4375342/best-buy-to-close-50-us-stores.html

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Not a huge amount of Best Buy Closing, but is this just a start for this giant company.
When you look at the size of a best buy, thats alot of product.

More Closing and stuff if your interested
http://www.dailyjobcuts.com

[Orrex]

1. Well, we can always go to Circuit City instead

[mikeytherat]

3. Good 'ol Circuit City - Home Depot-ed into the ground.

mikey_the_rat

[Liberal Veteran]

26. I'd rather go to CompUSA or Egghead instead.

[Ian David]

2. I wonder if the boycott is working.

Best Buy Donates $100,000 to Anti-Gay Candidate Tom Emmer
http://www.shewired.com/g-spot/best-buy-donates-100000-anti-gay-candidate-tom-emmer

[geardaddy]

18. Best Buy is a very, very red company.

I don't think the boycott worked for the other red MN retailer - Target.

[rwsanders]

28. I hope so...

I almost bought a computer at a Best Buy and while I was waiting for it I noticed there selection of books was filled with a load of garbage that included a discredited book about Hillary Clinton. I notice the others were similar loads of crap and told the sales clerk that I was leaving because of it. He said corporate chose the books.

[closeupready]

33. I didn't know that. no BB for me, now.

thanks.

[mahatmakanejeeves]

4. Why Best Buy is Going out of Business...Gradually - Forbes

Why Best Buy is Going out of Business...Gradually - Forbes

Larry Downes, Contributor
Tech, 01/02/2012

Electronics retailer Best Buy is headed for the exits. I can’t say when exactly, but my guess is that it’s only a matter of time, maybe a few more years.

Consider a few key metrics. Despite the disappearance of competitors including Circuit City, the company is losing market share. Its last earnings announcement disappointed investors. In 2011, the company’s stock has lost 40% of its value. Forward P/E is a mere 6.23 (industry average is 10.20). Its market cap down to less than $9 billion. Its average analyst rating, according to The Street.com, is a B-.

Those are just some of the numbers, and they don’t look good. They bear out a prediction in March from the Wall Street Journal’s Heard on the Street column, which forecast “the worst is yet to come” for Best Buy investors. With the flop of 3D televisions and the expansion of Apple’s own retail locations, there was no killer product on the horizon that would lift it from the doldrums. Though the company accounts for almost a third of all U.S. consumer electronics purchases, analysts noted, the company remains a ripe target for more nimble competitors.

But the numbers only scratch the surface. To discover the real reasons behind the company’s decline, just take this simple test. Walk into one of the company’s retail locations or shop online. And try, really try, not to lose your temper.

[AllyCat]

6. You can't buy a freakin' ink cartridge without being tagged for buying some other crap

I get tired of the upselling, the extended service plans, the push towards a model of something you have clearly said does not interest you. And the putting out of business of all the little shops with better stuff and FAR better service.

We still try to use the one little place that is still open in our area. Best Buy makes me nuts.

[liberalmike27]

15. The Bottom Line is Most Important

I had a niece who worked there, and she got a 40 percent discount on items she bought. What that tells me is that they were still making a profit at 40 percent off. So if they want to survive, along with other companies, they are going to have to settle for a much smaller profit margin, and stop paying huge salaries to head-office people, who sit in meetings on on the phone all day long. Employees are already getting minimum wage, so not much cutting can go on there.

People are pretty happy avoiding sales taxes, as anyone who knows anything knows sales taxes are a ridiculous slap in the face of the poor and lower middle class. The less you make, the more of your salary you pay in sales taxes, so if you can buy it cheaper, with free shipping online, most are going to do so.

Sadly, instead of changing the tax base of local stores to income based taxes, or some other method, most are passing stupid laws that you've got to pay voluntarily sales taxes on stuff bought from other states, on line. This is ridiculous of course, since you're really not buying it here, but you're buying it there, electronically. I don't think it'd stand up in court, but who knows these days.

Profit margins need trimming to compete, and the days charging nearly the same price, with $2 an hour foreign labor are gone. Your going to have to give something back, because your little globalization plan has nearly broken American wages that we can't keep supporting your 20 million dollar a year CEX's (O,I,F,whatever).

[OverDone]

17. True

True... Be interesting to see what comes of this

[obxhead]

27. A couple of years ago

While xmas shopping with my father for a laptop we walked out of 3 stores due to upselling. Bestbuy was our 4th stop and I raced inside to the PC section. I flagged down a salesperson and explained we would buy a PC immediately as long as he promised not to offer any kind of service plan or upgrades. Thankfully he listened and the 5 hour shopping hell ended.

I've worked enough retail jobs to understand upselling, but it really does get over the top sometimes. Bestbuy is one of the worst for this.

[Fuddnik]

7. "Amazon's Showroom".

I used to buy about everything at Best Buy. Until they clipped me for a 15% ($30) restocking fee on a GPS that was giving me wrong directions. That was four years ago, and I haven't spent a nickel there since. I do shop there on occasion, just to check something out, then buy it cheaper elsewhere.

[dixiegrrrrl]

16. nice bit of info, thanks for that.

[X_Digger]

5. I can't stand their new layout and either pushy or non-existent sales help.

I'm sure some marketroid business school graduate probably came up with their new layout, using terms like 'maximizing the visual experience' (aka, can't find shit, so you have to look everywhere.)

And if you do happen to find a sales associate, chances are they don't know the answer to your question, but they'll sure try to sell you some other crap you don't need or want.

Meh.

[Mopar151]

8. I haven't been in a Best Buy in years

My last straw was pricing a dishwasher - employee indifferent, very little info available, price increases by 20%+ with delivery + upcharges, big push for the service plan.

Went to see my local guy. Better delivered price ("'Cuz you talk to a lot of people&quot , knew features inside and out, does his own service, delivered when I wanted it - no waitaround for half the day.

[HughBeaumont]

9. I said 4 years ago . . . "Wait until your Best Buys and Circuit Cities and Targets start closing".

Here we are.

You could have all of the "NEXT GREATEST WHIZ BANG KILLER APP"s out the ass and if no one has the cash to buy them (because their stagnant-to-empty pockets are struggling to keep up with the skyrocketing costs of necessities), it's not going to mean a hill of cowshit, LeFleur.

Crapitalism: Officially eating itself since 1979.

[Moostache]

13. That is what is killing the overall economy...Best Buy is doing its level best to die faster...

You are 100% right about the fact that GROWTH - that omnipresent ideal that B-schools and executives and shareholders chase like zombies looking for fresh brains - is IMPOSSIBLE without bottom up prosperity. The societal pyramid that allows some people to amass fortunes worth many times the aggregate wealth of the base WILL tip over....its a mathematical certainty. The solution is easy enough to understand if you accept basic facts like arithmetic!

2+2=4, NOT the Orwellian 2+2=5.
Customers + Knowledgeable, Well-paid staff = Return Sales
You simply cannot warp that equation and still survive long term, though you might be able to enrich yourself short-term...

If 1% or less of the population continues to take in the majority of income increases and prices are pushed ever higher by inflation and ignorant monetary and energy policies (or lack thereof), then the end result is clear. Social collapse and anarchy, rebellion, bloodshed and needless suffering.

Until there is a lot more suffering and privation though - when cell phones are no longer accessible and the latest news about Snookie can't be tweeted by every 12 year old future moron in the country - you won't see revolution....but make no mistake, those who have amassed the wealth that they have by raping the rest of us have ZERO intention of giving it back or using it for generating a better society...it will have to be taken back by any means necessary.

[Moostache]

10. And so begins the end of store front electronics retailing...

At least in the current Best Buy model that is.

I remember about 15 years ago there was robust competition from Circuit City - (who back then was actually WAAAAAAAAAAAAAAAAY better than Best Buy...at least until the geniuses at Circuit City decided the road to prosperity was paved with the dead bodies of their "over-priced" sales force - the sacking of their most senior staff was actually the last nail in the coffin for them) - and other smaller regional or local stores.

In St. Louis, back in the 1990's, I had two stores in the area and despite the low number, they seemed to have good availability of items on the shelves. By the middle of the 2000s the number of outlets had tripled, although the local availability of things did not improve, it actually got worse as their attempts at just-in time inventory were WILDLY off...and the population of the area actually DECREASED in that interval...fewer people, more stores, worse inventory management and throw in the constant haranguing to buy service plans and new "plans"....the whole thing is getting to be just "ewww"....and I LOVE electronics!

Over-expansion.
Tragically unengaged and disinterested employees.
Ham-fisted sales tactics and initiatives.
Draconian return policies that treat ALL customers like criminals.
Executive bloat and extreme salaries.
Pathetic store layouts and employee retention that would make McDonald's blush.

Best Buy will be out of business faster than anyone thinks....Circuit City went from store closings to out of business in under 2 years I think....Best Buy is about the same level of crapitude now that Circuit City was then, but the online model is more established and mature now than a few years back. Best Buy may not make it through Christmas of 2012 at their current rate of sinking...
Well, I believe that its still possible to compete (and WIN) with store front operations that make Amazon the clearing house and the local outlet the

[dixiegrrrrl]

19. I hope you will post more often.

I like your very articulate, engaging posts.

[liberalmike27]

20. Underestimation of Lower Level Employees

is a regular Republican theme. They truly think people who work for others are worthless, and repeatedly they find they are wrong, and that often the best people are the MOST important people, as they are the folks that actually deal with the public, the customer.

If you pay people nothing, you get very little back. It's pretty clear what your employer thinks of you, if they don't pay you enough to even rent a small place for yourself.

The point made above is perfect. Part of the race to the bottom has ended up impoverishing 50 percent of us, some working menial, low-paying jobs, while others are completely unemployed. The places that now build the stuff we use, do it more cheaply, but are often payed so little they can't buy the stuff they make. So no demand added, a bunch is removed because we lost the good jobs here. So you've ended up eliminating 50 percent of the people who buy stuff.

And all it would take is reasonably jiggering the compensation of the top earners. Adding a 90 percent tax on all dollars made by anything, including capital gains, would often have the result of employers not paying anyone more than that, since the government would eat it anyway. Then use that money to pay down debt, and to create jobs doing the many things we need doing, roads, bridges, solar arrays, windmills, and the grids to get the power where it needs to go. Companies could use the money they save, for more profits, and for paying employees more, plus add a living-wage amendment, then index it to any inflation. That's the fix, but it doesn't fit their uncle Miltie Friedman philosophies.

[xtraxritical]

23. Circuit City is going strong on the Web

this was a very good decision on CC's part. All the Best Buy "ewwws" you listed could be easily rectified by a better management team and makes BB a likely "take over" candidate. The stockholders that hang in there may be rewarded.

[MicaelS]

29. The "old" CC no longer exists...

The CC name and trademark was bought by Systemax, who also bought the CompUSA name and trademark. Systemax also owns Tiger Direct.

http://en.wikipedia.org/wiki/Systemax

Subsidiaries and Divisions

Subsidiaries and divisions of Systemax, Inc. include SystemaxPC, Tiger Direct, CompUSA, CircuitCity.com, Global Industrial, Nexel, Misco, Infotel, Global Computer Supplies, SpeedGifter and Worldwide Rebates.

CompUSA acquisition

On January 6, 2008, Systemax Inc. announced an agreement on the acquisition of the Miami-based CompUSA brand, trademarks and e-commerce business, and as many as 16 CompUSA retail outlets in Florida, Texas and Puerto Rico.

Acquisition of Circuit City trademarks and website

On May 13, 2009, Circuit City announced it had closed a deal with Systemax allowing them to acquire the intellectual property of Circuit City, including its trademarks, brand name, and internet domain, for $14 million.The deal took effect six days later, and the first store under Systemax (currently using the CompUSA brand) opened in November 2009. The Circuit City website was restored with the Systemax purchase.

[FarCenter]

11. With computers selling for $500 and flat screen TVs for $1000, it's hard to make a buck

Their business model worked better when PCs were $1000 and flat screens were $2000 and up.

Plus, despite attempt to upsell consumers with the virtues of LED backlights and 3D gimmickry, flat screens have become well-defined commodities that can be purchased over the web.

[bananas]

34. Vizio's computers will have prices that "don't seem possible"

They're supposed to start selling this summer.
http://www.engadget.com/2012/01/06/vizio-desktop-laptop-pc/

[FarCenter]

38. Their two strategies seem to be Best Buy-specific models or their house brands

Two ways to get back some margin are to either:

- get Acer, Toshiba, etc. to produce models that are only available to Best Buy so that it complicates comparison shopping by the customers, or

- buy direct from the Asian OEMs with their own specifications, branding and packaging.

I doubt that these are enough to save them.

[sarcasmo]

12. My lap top chord was 150 at Best Buy

20 dollars on Ebay. Everything in that store has a crazy mark up.

[liberal N proud]

14. Bye bye - Best Bye

[Gidney N Cloyd]

21. I've had great experiences at most Best Buys I've shopped in. (Not all, but most)

The last thing I bought was a BluRay player a couple months ago. I needed one right away so I shopped on Best Buy's web site, found a store that had what I wanted in stock, went there and got it. The salesman asked me if I needed an HDMI cable and showed me their selection.
Past visits when I've done a little more browsing on site I've always had polite and reasonably knowledgeable sales people. No one bothered me more than I wanted to be and the only upselling I ever get is at the checkout where they try to sell the extended warranties (I say 'no thank you' and they push no further).

Yes, there's one bad store near me that I won't set foot in again (even though it's the closest one to me). Seems to be run by pre-teens who couldn't squeeze the words 'sir' or 'thank you' out of their mouths if you held a gun to their heads. When a saleschild greets me with "whatcha need, bud?" I know I'm in the wrong store. And the bad service there stretched from the front door to the returns and techsup counter. But that store unit is unlike any other I've visited. No doubt there are more but it's unique among the half dozen or so I've been in around Chicago.

[DinahMoeHum]

22. BB screwed me over TWICE re their points for cash rewards racket. . .

once, by automatically dumping them after a ever-so-shorter time period and
then, when they refused to honor a special triple points deal (a birthday "present&quot over a specific product that was absolutely legitimate and according to rules.

When I recently bought a new all-in-one printer, I got it at Staples. The only things I'll get at BB now are phone top-up cards, replacement ink cartridges, or recently released CDs; things where I know EXACTLY what I want/need.

Bye bye, "Best Buy" (not). Hope it was worth fucking me over as a customer.

[They_Live]

24. I recently went to BB

to purchase a BluRay/DVD set, because they had the best retail price. At check out, they offered a "replacement program" for the disc for $2 in case the disc got scratched. I'm pretty sure that I laughed out loud. They have been working overtime to alienate their customer base over the years, reducing inventory of cds/dvds, over-complicating their "rewards", lack of knowledge from the employees, etc.

[onehandle]

25. Anyone here like the current layout of Best Buy stores? No?

I had nothing to do with the redesign a few years ago, but I did have a close business relationship with those who did.

When I saw the proposals for the stores, I clearly remember thinking, 'Well, that's the end of Best Buy.'

I can't even stand to go there to window shop.

[OverDone]

30. Has anyone seen / details on the new Mobile Stores???

Last edited Thu Mar 29, 2012, 01:23 PM - Edit history (1)

They said in the article 100 new mobile stores. What are they going to be? Just mobile phone stores or what? Any ideas?

[blue_onyx]

32. Yes

Those are stores for just cellphones. They opened one in the mall near me last year.

[OverDone]

36. If thats true...

Then Best Buy is not different than any of theses other mobile phone place.
Cell phones are great, but they are getting out of hand with all the kiosks and in your face 24/7

[Odin2005]

31. No sympathy for them, their customer service sucks...

...and women have told me that the salesmen on the floor are sexist as fuck and treat female customers like morons.

[Wait Wut]

37. "...treat female customers like morons."

The husband and I stopped in to look at sound systems. The "sales kid" kept talking to my husband about apps, features, etc. My husband told him TWICE that he should talk to me since I'm the "tech expert" in the house and would also be making the final decision. The kid would say a few words to me, turn and start talking to my husband, again. If I asked a question, he'd answer my husband.

[SheilaT]

39. Car salesmen are generally the same.

Unless the woman shows up alone.

I terrorize the younger car salesmen because I will only buy a stick shift, and a lot of the young guys can't drive one, and have never known a woman who could. The salesmen my age (over 60) generally treat me better.

[totodeinhere]

35. They are being killed by online retailers like Amazon.

Brick and mortar stores just can't compete price wise with online retailers. Many people shop at Best Buy, then get on their smart phone to see what the product they are looking at costs online. For instance, I have an app on my iPhone that instantly compares prices for any particular model and it gives me the best price available. I have never seen it list Best Buy as the price leader. So it's almost always cheaper online so they jilt Best Buy and buy online. And companies like Amazon usually offer free shipping to boot and in some cases you don't pay sales tax either.

[David__77]

40. I was really rude to an aggressive salesperson there the other night.

I didn't mean to. I just got mad because I was CLEARLY not interested in hearing a sales spiel about something unrelated to the department I was in. Best Buy not only forces their sales people to be pushy, but also allows third party vendors to do so. Poor guy... I felt bad because I know it's just their job.