Best Buy closing many stores

[disneysteve]

I meant to post this last week. Best Buy announced that they will be closing numerous stores. I think the report was 50. I'm not at all surprised by this. I think online shopping is killing them. We often joke that Best Buy is really just Amazon's showroom. People go in there to see the items, ask questions, check them out and then they order them on Amazon. I know I've done that more than once myself.

I wonder how long these big box specialty stores can continue to exist with their current business model. Everything is cheaper online and I don't even need to leave my house to buy things and have them shipped to my door. Why drive to a store only to pay more, sometimes way more. For example, iPhone chargers are about $20 in the store. Online, we get them for less than $3 with free shipping. iPhone screen covers are 2 for $15 in the store. Online, they are 3 for $0.75 with free shipping. Our computer was the same price online as in the store but included a free printer and a couple of other free things and software that we wouldn't have gotten in the store. My digital camera was cheaper online and came with a free case, tripod, and cleaning kit. I don't see how any store can compete.

[bjl584]

I suppose there will always be a need for a tradition physical store, but the internet has definitely changed how customers shop. If Best Buy is smart they will transform into an online company themselves with smaller leaner stores to compliment their online offerings. Best Buy can still survive if they focus on customer service, tech support, and repair and installation of products. Maybe have a store with say 1/3 the inventory and computers stations that customers could order from their online store from. Allow people to return items to a physical Best Buy store that they bought online to save the hassle of having to ship it back by UPS or Fedex. Then maybe expand their repair, installation, and tech support services. Sell themselves as a one stop shop for purchasing items, having questions answered and problems fixed by technical experts, and offering installation and set up in customers homes on computers, stereo systems, car audio, and major appliances. I suppose that they already do this to some extent, but focusing on customer service will be the only way to survive.

[BudgetSurgeon]

I loved that store....sort of like a big-kid's toy store. But, like you said they can't compete with online shopping, with all that overhead. They can't even compete online - plenty of guys out there beat them by 10% regularly. All good things must come to an end, I guess. So much for progress....

[bumstah]

According to what I heard on the radio, they aren't dying but transitioning their stores into micro-stores. Kind of like a Brookstone if you've ever been in one.

"I suppose there will always be a need for a tradition physical store, but the internet has definitely changed how customers shop. If Best Buy is smart they will transform into an online company themselves with smaller leaner stores to compliment their online offerings."

This is exactly what they're doing, actually. Their plan is to close down big stores and open "micro-stores", some of which will open as early as this year. The micro-stores will basically be a showcase for some of their flashier merchandise like new TVs, cellphones, and whatnot. Most of their business will transfer online. It seems like Bestbuy has finally accepted the fact that their physical stores are "showcase" stores, and will deliberately make the changes to transition into one. I think it's a smart move.

[elessar78]

YEAH BUT . . .

It's a one-way symbiotic relationship (I know oxymoron) but people only feel comfortable buying online because they've seen the picture quality in person. I think once people can't find a place to see it in person, the demand is going to swing back the other way. I think the model should change in that they reduce the size of their stores and have all their sales online. The stores basically become showrooms with only a skeleton crew.

Overall they can reduce inventory because their inventory can become centralized and not have to stock individual stores.

I'm curios what products Best Buy makes their money on.

[kork13]

but...but...but.... Where will I go now to check out the stuff I wanna buy on Amazon?!?

[kork13]

I'm curios what products Best Buy makes their money on.

That's the irony of the big box store... They make their best profits on stuff that going in to "see it first" doesn't make a difference, selling under-utilized warranties, computer/electronic repairs, and stuff like video games and music. (at least that's my understanding)

[auron]

I actually did buy my Samsung TV during Christmas and amazingly it was cheaper than Newegg/Tigerdirect/other online places.

When I was asking the sales rep about sound systems, he told me not to get a Best Buy sound system simply because I'd pay more than online. Do Best Buy sales reps not get commission?

[snafu]

Sorry so many jobs lost and knowledgeable staff scattered. Who will give us the comparatives we need in language we tekkie challenged can understand in order to buy machines that deliver what we expect?

[dfeucht]

I actually did buy my Samsung TV during Christmas and amazingly it was cheaper than Newegg/Tigerdirect/other online places.

When I was asking the sales rep about sound systems, he told me not to get a Best Buy sound system simply because I'd pay more than online. Do Best Buy sales reps not get commission?

No - they actually don't. That is what I liked about them, I felt like I was getting an honest assessment. (They might get something for selling the warranties since they always push that hard - even the $10 warranty to cover a $30 alarm clock!)

[greenskeeper]

commercial real-estate is the next "bubble" to burst

[AccountantSalary]

First it was Borders, now Best Buy. They're closing all of my favorite hangouts. And for the record, I did buy from those stores, mostly for instant gratification. I don't have the patience to wait for online orders to arrive.

[YLTL_Dan]

It's not only online shopping that's hurting Best Buy, but also big retailers that have gone all-in with electronics. Wal-Mart and Target have made a big jump into electronics and have stolen a lot of BBY's market share. Sure, they lost competitors like Circuit City and Ultimate Electronics, but their new brick and mortar competitors are even more dangerous.

[woodie96]

Sometimes I wonder if we aren't "internetting" our way down the toilet. Here, we have a big QVC presence, and they are now closing most of their call canter because so many more items are ordered online and the jobs just can't be supported at the center.

I like to go see an item, and if I resist the impulse buy it then and there for a few dollars more, then I will usually go order the item online and wait for shipping.

I think some smart person will figure out a way to use the internet so we can begin to use it to fill some of these job vacancies created by the internet availability.

[disneysteve]

they lost competitors like Circuit City

Around here, the demise of Circuit City was almost a non-issue because they were quickly replaced by 2 new chains, in many cases taking over the old Circuit City locations. P.C. Richards and H. H. Gregg moved right in.