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BEST BUY IMPLODES: Misses Revenue, Firing 400, Closing 50 Stores
yahoo Finance ^ | march 29, 2012 | Eric Platt

Posted on 03/29/2012 8:06:03 AM PDT by Hojczyk

Electronics retailer Best Buy announced it would close 50 big box locations in the U.S. as it refocuses its operations around mobile.

The company said it will launch 100 new mobile locations as it retools its domestic store format. The announcement was timed with the company's fourth quarter report, where it sharply beat analyst expectations on the bottom line. Over the final quarter of 2011, revenue grew three percent to $16.6 billion while earnings per share hit $2.47.

However, analysts polled by Bloomberg had forecast top line results of $17.15 billion, some $500 million more than the company reported. The quarter also benefitted from an extra week in the company's fiscal calendar — excluding the week would mean revenue actually fell 1.1 percent. Shares were down 6 percent in the first minutes of trading.

The company saw same-store sales decline 2.3 percent during the period, highlighting its difficulties as the U.S. economy gained steam during the first few months of 2012. Best Buy saw weakness across the board, with sales suffering in gaming, notebooks, digital imaging and televisions.

Best Buy has rapidly been trying to turn its operations around as it has seen peers CompUSA and Circuit City fail. Consumers have been using its locations as a testing ground for products before making final purchases at competitors like Amazon and Walmart.

Best Buy is targeting more than $800 million in cost savings by 2015, largely expected through layoffs and the aforementioned store closings. The targets are roughly split between corporate, retail and declines in costs of goods sold. The company will layoff 400 employees within its management and support channels.

(Excerpt) Read more at finance.yahoo.com ...


TOPICS: Business/Economy; News/Current Events
KEYWORDS: bestbuy
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To: Hojczyk

Zackly right. I used to go to BB for CDs, but now we just download. With large HDDs and flash drives, nobody needs disposable media like CDR and floppies, and you can buy ink and paper at the drugstore. So what do you need an electronics big box for? So you can touch and feel alternatives before you go online and shop for the best deal that UPS or FedEx will then deliver right to your door, often for free, and usually without paying sales tax.

Sorry Best Buy, but I colored you gone a couple of years ago....


41 posted on 03/29/2012 8:52:26 AM PDT by bigbob
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To: Hojczyk

Best place to buy a TV or electronics is Costco. They have a 90 day return policy so if the price goes down during that time period, you can get the difference back. They also have a 2-year warranty and you can bump that up to five years for a very small fee.

Not the largest selection in the stores, but you can get more options online; and without the sales tax.


42 posted on 03/29/2012 8:54:43 AM PDT by SeaHawkFan
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To: cicero2k

The Apple and the Microsoft stores are great. The people who work there actually know what they are talking about.


43 posted on 03/29/2012 8:54:50 AM PDT by reg45 (Barack 0bama: Implementing class warfare by having no class!)
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To: cicero2k
The customers are over at the Apple Store.

You better believe it. Any given time of day, the local Apple store has more customers inside than the big box Best Buy does. The Apple store is so busy that they could open a drive-thru window.

44 posted on 03/29/2012 8:56:40 AM PDT by The KG9 Kid
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To: dfwgator
Plus when you can find somebody for help, they are completely clueless.

Back when Sales Associates were still on commission, Circuit City did NOT have this problem. A commission-based sales guy who didn't know his stuff didn't last long.

45 posted on 03/29/2012 8:57:52 AM PDT by Future Snake Eater (If we had a President, he'd look like Newt.)
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To: Gaffer
The one in Marietta treated all exiting customers like thieves.

The one local to me in NC did the same.

I chose to no longer patronize them because of it. Sam's Club, too.

46 posted on 03/29/2012 9:05:28 AM PDT by wbill
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To: Hojczyk

Best Buy has numerous problems. First why the heck does a supposed electronic retailer sell vacuum cleaners and refrigerators? Customer service at Best Buy was hit and miss in my experience. Lastly the audio CD is nearly obsolete so why devote a considerable amount of retail space to selling them? Much smarter would be to sell music downloads through a computer kiosk. Best Buy also has increased price competition from online retailers and discount stores like Sam’s Club and Costco particularly on bigger ticket items like TVs.


47 posted on 03/29/2012 9:13:02 AM PDT by The Great RJ ("The problem with socialism is that pretty soon you run out of other people's money" M. Thatcher)
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To: The KG9 Kid
The customers are over at the Apple Store.

You better believe it. Any given time of day, the local Apple store has more customers inside than the big box Best Buy does. The Apple store is so busy that they could open a drive-thru window.

Apple stuff just plain works. This from a PC sysmgr since the 6502 and Z80 microprocessor days.

48 posted on 03/29/2012 9:16:43 AM PDT by USCG SimTech (Honored to serve since '71)
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To: Hojczyk

Posasibly, if Best Buy had immediately following a lackluster Christmas season, fired 400 and closed 50 stores, shedding some costs and possibly lowering some prices as a result, their costs-vs-revenue situation would have quit depreciating by now. The signals were undeniably there months ago. They didn’t need another 90 days to tell them what to do.


49 posted on 03/29/2012 9:17:37 AM PDT by Wuli
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To: Hojczyk

I’ve hated Best Buy for years and have not shopped there since I was charged a “restocking fee” several years ago.


50 posted on 03/29/2012 9:17:50 AM PDT by freeangel ( (free speech is only good until someone else doesn't like it)
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To: Hojczyk
I live almost within walking distance of a Fry's. I almost never go to Best Buy since it opened. If I've ever needed any computer accessory or HDTV accessory (HDD, network cards, video cards, power supplies, etc) they always help me find it and make sure I'm getting what works for my system.

Around Christmas, the wife wanted to get me an iPad cover (the kind that is like an easel). No one at Best Buy helped her. The salesperson asked stupid stuff like "what type of iPad?". She eventually went to Fry's and the salesperson found just what she wanted immediately.

51 posted on 03/29/2012 9:20:09 AM PDT by Sans-Culotte ( Pray for Obama- Psalm 109:8)
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To: Disambiguator
Anyone notice the "Reserved for Fuel Efficient Cars" parking spaces that are now found at Best Buy stores?

These are located closest to the store along with the handicap spaces. Counted more of the fuel efficient spaces than handicap...

Parked my SUV there anyhow. Asked the employee at the door what qualified as a fuel efficient car, he said anything that gets 35 MPG +. Pointed to my SUV (the only one in those spaces by the way) and said it gets 35+ going down hill with a tail wind....

52 posted on 03/29/2012 9:20:41 AM PDT by TruthWillWin (The problem with socialism is that you eventually run out of other peoples money.)
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To: Hojczyk
as the U.S. economy gained steam during the first few months of 2012.

Things always speed up when going downhill.

53 posted on 03/29/2012 9:20:59 AM PDT by N. Theknow (Kennedys=Can't drive, can't ski, can't fly, can't skipper a boat, but they know what's best for you.)
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To: Mad Dawgg

It’s not him, it’s them. They didn’t change correctly for the changes in their business. Most of their “middle of the store” stuff (music, movies, games) is available completely digitally and even in physical form cheaper with a wider selection elsewhere (mostly Amazon). Even a lot of their “perimeter” stuff (computers, TVs, car stereo, appliances) is easily acquired elsewhere, often directly from the manufacturer, again cheaper and with wider selection. To make up for that they’ve jumped big into the mobile market, selling other companies’ cellphones competing directly with those companies that almost never give them a discount, so once again the customer can buy it cheaper elsewhere, a market that Radio Shack has already proven is not profitable.


54 posted on 03/29/2012 9:23:52 AM PDT by discostu (I did it 35 minutes ago)
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To: Hojczyk

Most people could make a pretty long list of reasons why online shopping is preferable to going to a retail outlet. If you don’t have to try it on, or test drive it, or otherwise evaluate the product in person, shopping online offers big advantages including lower prices and almost unlimited selection.

The smart retailers now have their own websites and online shopping for anything that can be shipped economically.


55 posted on 03/29/2012 9:24:41 AM PDT by Will88
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To: Republic Rocker

Sales of electronics aren’t dwindling, sales AT Best Buy are.


56 posted on 03/29/2012 9:27:05 AM PDT by discostu (I did it 35 minutes ago)
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To: Hojczyk

They at least need to be pranked one more time like this!
http://www.youtube.com/watch?v=KgUIbPfhSuo


57 posted on 03/29/2012 9:32:22 AM PDT by Jack Hydrazine (It's the end of the world as we know it and I feel fine!)
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To: Hojczyk

The USA is massively over-retailed. All of these “big box” stores are going to have to close at least 25% of their locations to survive. Best Buy, having become “Amazon.com’s Showroom” is probably in even worse trouble than the others. They offer nothing that can’t be had easier at Costco and Wal-Mart or cheaper online.


58 posted on 03/29/2012 9:33:58 AM PDT by Mr. Jeeves (CTRL-GALT-DELETE)
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To: almcbean
Their customer service is a big part of their problem.

You're expecting top shelf service?

What do ya think your going to get with an $8 per hour/no benefits employee?

59 posted on 03/29/2012 9:41:43 AM PDT by dragnet2 (Diversion and evasion are tools of deceit)
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To: Hojczyk

Wastin away in Barack Obamaville....


60 posted on 03/29/2012 10:06:10 AM PDT by rwoodward ("god, guns and more ammo")
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