Best Buy, the world's largest specialty electronics chain, has announced the closing of 50 stores throughout the United States. This move to close down 50 stores is part of a new remodeling plan by Brian Dunn. In the 1990's the "Big Box" formula made Best Buy very popular, but in the new age this formula proves less popular. Dunn plans to open up smaller stores to focus solely on mobile phones and tablets. This decision to close down stores coincided with Dunn's resignation due to "personal conduct" infractions. The company's board of directors launched an investigation into the misuse of assets by Dunn in an alleged relationship with a subordinate. This resignation comes at a very bad time for Best Buy and could lead to more bad news for the once leader in electronics retail.
I think this move to close the big box stores in order to make room for smaller, more focused stores is an interesting one. I do think that big box retail is showing less profit than online retailers which can provide cheaper products and larger variety. I think the move towards smaller retail stores will end horribly because their market share will be minuscule compared to the all ready established Apple, Verizon, and AT&T stores.
More information can be found at:http://online.wsj.com/article/SB10001424052702304444604577343884165564936.html?mod=WSJ_business_whatsNews
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