The last few years we have seen several large big box retail companies go under, including CompUSA and Circuit City. Yesterday, Best Buy
had an earnings call that makes it appear that the company is shifting its focus
and may be in danger of going the way of its former rival. I won’t bore you with the details, but Best Buy missed projected earnings, mentioned that same store sales were down 2.3%, announced the closure of 50 of its Big Box locations, layoffs of 400 employees and that it will open 100 more of its Wireless standalone stores. All of this is slated for the 2013 fiscal year.
Here is the earnings call highlights
if you want to peruse them, but the bottom line is that Best Buy is hurting and losing market share. Why should you care? Well if Best Buy exits the market in its current form, your regional electronics store, Wal-Mart, Target or warehouse clubs may be your only option to take a look at a television or other gaming gear in person before you buy it. Online stores offer better pricing, but cannot give you the customer service options you get from a physical store.
This will be something to keep our eyes on over the next several months.