One of the front runners in the business back in the day, Best Buy now seems to be scrambling for visibility amidst some heavy duty competition in the market, today. They stood comfortably for years, being the largest U.S. specialty electronics retailer, and growth came quickly, too, with the setting up of several large retail stores (big box format), and ardent shoppers. Now, however, with the market scenario fast-changing, and dipping sales, Best Buy seems to have jumped onto the change bandwagon. Reports confirm that the popular electronics retail chain will now be going in for some major changes, which include the closure of several of their large stores, several corporate job cuts and some heavy duty cost cutting. According to reports, Best Buy have in an official statement confirmed that they now plan to shut 50 of their 'big box' stores in the U.S, downsize their corporate workforce by cutting 400 jobs, while also reducing $800 million in costs. Among other things, Best Buy now plans to instead open 100 smaller, more profitable Best Buy Mobile stores, across U.S.
Vying for more doors and less square footage!
Citing the company’s ambitions behind their latest move, Brian Dunn, CEO, Best Buy, stated that with the aforementioned changes, they aim to “have more doors and less square footage.” Among other plans it has in its book, Best Buy, reportedly will undergo several changes to its existing business and will now focus their resources on their unique factors. These factors include trained sales staff, which they believe “help shoppers get the most out of their tablets, TVs and other electronic devices, including tech support from its “Geek Squad” service and repair unit.” Reportedly, Best Buy is treading very carefully, since according to reports, they fear going the Circuit City way – Best Buy's rivals, who “liquidated in 2009 after it struggled with the changing electronics landscape.”
Companies, like Best Buy now see themselves function in a scenario where sales of electronic products, like TVs, digital cameras and videogame consoles are slowing, while that of tablet computers, smartphones and e-readers are going from strength to strength. That, alongwith increasing competition is giving companies like Best Buy a hard time.