Best Buy Says It Will Close 50 Big Box Stores, Cut 400 Jobs
While several elements of the economy, such as the housing market, are on the rebound, some companies are still adapting their business model. I would think the Duluth store would be safe as that Best Buy store is really the only of its kind in the community. That’s not to say there’s no competition for the goods and services it does sell. As this story states, I think we will see less of this huge stores and more smaller specialty stores where you can get some training and other one on one things.
Where is your preferred place to buy computers and electronics?
Best Buy Co. Inc. said Thursday that it will close 50 big box stores this year and eliminate 400 jobs, mostly at its corporate headquarters, in a bid to boost profits amid declining stores sales in the United States.
The Richfield-based consumer electronics giant expects to save about $800 million in three years, including $250 million this year alone.
“I’m not satisfied with the pace of our transformation,” Dunn told analysts during a conference call.
The company has not yet finalized the list of stores to be closed, said spokeswoman Susan Busch.
As of noon, Best Buy stock has fallen nearly $2, or 8 percent, to $24.61, a sign investors are not impressed with Best Buy’s plan.
For the fourth quarter, Best Buy said it lost about $1.7 billion, or $4.89 per share, compared to a profit of $651 million, or $1.62 per share, during the same period a year ago. Sales at stores open for at least a year, a key measure of growth for retailers, fell 2.4 percent.
For the year, the company lost $1.2 billion, or $3.36 per share, compared to a profit of $1.3 billion, or $3.08 per share during fiscal 2011. Same-store sales declined 1.7 percent.
As consumer electronics have become more affordable and ubiquitous in recent years, Best Buy has lost sales to Amazon.com, Wal-Mart, Costco and Target. Last holiday season, the company acknowledged losing TV sales to other big-box stores, as well as retailers such as Staples and Office Depot.