Best Buy: On the road to extinction?

Categories: Best Buy
best-buy.jpg
Best Buy has been beseiged by bad news this holiday season.
Could one of the Twin Cities' largest companies be on the road toward ending up in the tar pit of retailers along with Circuit City and Ultimate Electronics?

Possibly. A Forbes piece published yesterday makes a strong case that Richfield-based Best Buy is headed for extinction.

The piece cites stagnating market share, declining stock value, and a disappointing third-quarter earnings report as indicators that Best Buy is going bankrupt "gradually, then suddenly."

The future of retail, Forbes' Larry Downes writes, are online-only retailers like Amazon that focus on providing outstanding customer service.

Downes writes:
The new conventional wisdom says that big box retailers like Best Buy are going the way of the dinosaur. Online giants, notably Amazon, are the future. Online retailers are more efficient, because they lack physical locations, and so can offer better prices. Shopping online is also more convenient. On the web, consumers can shop anywhere they are, day or night.

In addition to the negative earnings report, Best Buy has been taking a PR beating after announcing just days before Christmas that it would not be able to process some of its online orders, including some made the day after Thanksgiving.

In a statement released Dec. 21, Best Buy said:
Due to overwhelming demand of hot product offerings on BestBuy.com during the November and December time period, we have encountered a situation that has affected redemption of some of our customers' online orders. We are very sorry for the inconvenience this has caused, and we have notified the affected customers.

Downes bludgeons Best Buy for the passivity of that statement, writing that "the honest and appropriate" statement would've said: "Due to poor inventory management and sales forecasting of the most popular products during our key sales season, we can't fill order we promised to fill weeks ago in time for Christmas."

The online forum at BestBuy.com is filled with comments from outraged shoppers, one of whom writes"
"As a Minnesotan I preferred to do my business with a Minnesota-based company. But I can say with honesty that I won't shop at Best Buy again."
Given that a 20 percent increase in online revenue over last year was one of the few bright spots in Best Buy's recent earning report, the fiasco over online sales could represent another step toward the proverbial big-box tar pit.

Advertisement

My Voice Nation Help
9 comments
Lloyd Llewellyn
Lloyd Llewellyn

 If best buy goes under, where will I be able to view new television sets before purchasing them elsewhere online? 

candyee
candyee

Are you still be lonely? Do you want someone to companion with you.  My- friends told me a  nice  place ------ 'Millionaire'Social...℃0--MThere are so many beautiful /successful people!,young girls / millionaire men. to- int'eract  with each other., "everything to everyone"dating \.marry .even, a nice club for y'ounger women and old'er men, or older women and y'ounger men, and Age is no problem. everything is possible!You do not have to be rich or famous

Crashcartjockey
Crashcartjockey

Personally I don't buy that the future of retail is online. I can't count the number of times that I haven't ordered something online because the description was incomplete or non-existent. Sometimes, you have to go out and put your hands on an object before buying it. I know I would never buy a TV with out watching it first and I could give a crap less how great Amazon's customer service is. If I buy a tv from them and the picture isn't what i expect, they are going to say, "oh sure, send it back. We know it's the 5th one this month that you didn't like, but don't mind paying for all that shipping."

pizza
pizza

"Best Buy: On the Road to Extinction?"-No. The government will bail it out because the U.S. is unabashedly opposed to the constitution.

Research
Research

Key words: Price, convenience, customer service.  Best buy has failed on these numerous times to customers.

Jeremy Hop
Jeremy Hop

I use BBY as a testing ground for products I've already scouted online, read reviews and done my homework.  I will go in person to peep it, then buy online.

brad
brad

There is no doubt in my mind most retail will move online. Price and customer reviews  dictate quality and product expectations. You end up with a better product for your money. Buying in a brick and mortar store you end up guessing on these issues. You are correct about TVs though, price of shipping and risk of damage or having to return it will keep people away. This is probably why big box distributors like Target have enlarged their tv selections in recent years. 

Darling
Darling

lol probs not, it will go the way of kmart and circuit city, best buy would have no political bargain given how much they've sliced living wage positions, reduced the number of employed, and slimmed corporate, the number of actual physical stores is probably on par with barnes & noble, they're a drop in the ocean of retail nowadays

pizza
pizza

No, not if only Best Buy folded, just trying to make a point. But if there were many retail giants that folded around the same time, precedent is there. Nothing is real, everything is permitted.

Now Trending

Minnesota Concert Tickets

From the Vault

 

Loading...