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Best Buy CEO Brian Dunn Resigns After $1.7 Billion Loss
An anonymous reader writes "Best Buy CEO Brian Dunn has resigned amid the big-box retailer's major financial problems. The announcement comes two weeks after Best Buy announced a $1.7 billion loss for its fiscal fourth quarter. Best Buy is trying to avoid the same fate as Circuit City, which went out of business in 2009, but the future looks grim." The article provides a reason not to trust middle-management: the company claims it had "no disagreements with Dunn about operations, financial controls, policies or procedures." Best Buy may not be Shangri La, but in many rural and semi-rural parts of the U.S., it's the nearest and best place to actually find a wide selection of electronics.
...but I only buy sale items. We bought an Epson 8350 video projector when it was $100 less than any other competitor that I could find, and have really liked it. But, again, I don't buy cell phones from them, and it's not common for me to buy computer parts from them anymore either. They probably can't survive as a big-box store when many customers are looking for a discount-boutique experience as far as the occasional big purchase is concerned.
Do not look into laser with remaining eye.
Their customer service is bad. Their sales clerks are trained to be pushy. Their prices are just so-so.
No big surprise.
How much of a bonus does he get for leaving?
Just curious.
If it weren't for online retailers, Best Buy would be my only choice for computer hardware other than a few small vendors (which cost even more than Best Buy). Thank the silicon gods for NewEgg and Tiger Direct.
The days of the big box electronics retailer are dead.
I can't say I'm too surprised, nor am I very broken up about it, either. I haven't had a very good shopping experience there since the early 2000's and haven't even stepped foot in one in over a year.
Why can't people in rural or semi-rural parts of the US just use Amazon like everyone else in the US?
I'm not sure I'm spoken to a Best Buy employee once without them lying to me. My most recent purchase was a new 3D TV. I made the purchase at Best Buy because they had the lowest price, despite how much I normally despise that store. The employee was insisting that I needed to buy high-end HDMI cables as well (despite the fact that digital cables don't have signal degradation in the way that analog cables can) and he insisted I needed a new 3D BluRay player. I told him I had a PS3 and he was adamant that PS3's couldn't play 3D BluRays, so I had to buy a new one. I pointed to his demo unit which was using a PS3 to play 3D BluRays.
I also know people who have worked at Best Buy in the past who admitted it is official company policy to lie to customers. They are trained to claim to own whatever item a customer is looking at, so they can recommend it.
Given Best Buy's business practices, frankly I expect them to fail over time.
Small electronics sales will likely move to Amazon, and people will just buy TVs and large items elsewhere (department stores, Walmart, Target, etc).
http://blindscribblings.com - Tasty pop-culture in conceptual fashion.
You say "The article provides a reason not to trust middle-management".
I don't think you know what middle management means. Sure, this is a reason not to trust corporate PR, but I think it should kind of go without saying that you should never trust corporate PR, as regardless of the truth of the situation, it is their JOB to say things that are "best" for the company.
Even with that gargantuan loss, I'll bet he still has a huge golden parachute in his contract.
American CEO's - the only job where you can lose billions and still get stupid rich for doing it!
"Murderer? Well, that's a harsh word. I prefer to think of myself as a Mortality Technician."
The internet has fundamentally and forever changed the way we do business. It stands to reason that big-box retailers are going to suffer as a result of changing shopping environment. I rarely visit a store to buy electronics. Instead, I make the purchase online.
So my boss gave me a gift certificate to Best Buy last year for $25. I needed a keyboard/mouse for another computer so figured I'd go use the gift card.
The cheapest combo was in the $45 dollar range and it was a real piece of shit. It cost me around the same amount with a gift certificate as it would have cost me to pick it up at Fry's.
I see no reason to ever go back to Best Buy.
Don't know something? Look it up. Still don't know? Then ask.
And yet Fry's Electronics is still going strong, has a great selection, and is really the only big box electronics store I'll go into.
Yes, they have a small army working the floor, just like BB, but unlike BB they aren't obnoxious or constantly harassing you*.
Here's what BB should do: Look at what Fry's is doing, and DO THAT!
*I understand from previous /. stories that this behavior is mostly the fault of the management, so apologies to the conscientious BB employees.
If thou see a fair woman pay court to her, for thus thou wilt obtain love
I went in looking for an ethernet card (pretty basic, right?) and the salesdroid informed me they hadn't stocked "wired networking stuff (sniff!) since October" and the manager standing right there just went "yup" and didn't seem to think it was a problem.
I went across the street to Staples to get the same card as the BB website for $9 cheaper.
Best Buy has themselves to blame for developing a reputation of over-priced products and unknowledgeable, pushy salespeople. But their latest attempts at reformatting their stores is, I think, the only strategy in which brick-and-mortar can survive. It is the model pioneered by Apple Stores. Everybody knows that brick-and-mortar stores have turned into showrooms for online purchases. Best Buy's latest layout tries to take advantage of the new retail reality by filling the showroom with a variety of devices, but then offering a friendly user support desk onsite (just like Apple's Genus Bar). In addition, subscriptions services like cable or satellite TV, mobile contracts, and so on are easily available, plus a variety of accessaries, and quality, friendly tech support, installation, and repair services. Best Buy needs to find a model where they may never sell another device again, but can make money on subscriptions, accessories, and services. Their latest store formats are getting close; the question is if it is too late for Best Buy?
Good riddance. I (and most of my family) refuse to buy anything from best buy. They have, on multiple occasions, refused to accept returns on items that are still under their warranty. In the case of a laptop, an item clearly under their extended warranty, they refused to honor.
So was Circuit City at one time.
I am Bennett Haselton! I am Bennett Haselton!
I'd rather purchase my electronics from that charming gentleman who walked up to me at the gas station than purchase something from Best Buy. He mostly likely has better selection and better prices if you can just overlook the fact that the box may just contain a brick or that the camera he's selling already has pictures of someone else's family on it.
1. Your employees are jerks. I hate talking to them, they are not people friendly. Every time I go to BestBuy, I cannot count the number of times where an employee follows me all around the store and asks what I think about whatever it is that I'm currently looking at. I wouldn't mind that so much but then when I finally find whatever it is that I came for, no one is within a 100 mile radius of me?! WTF?!
2. My ears hurt after leaving your store. I think it might be the employee that is trying to sell dude over there a new 346" HDTV that has said HDTV set to where the volume has to rival any 747 that might also want to take off in your store. Literally I travel to BestBuy with earplugs.
3. Your prices suck. That is all there is to that.
4. I feel bad for coming to your store. I hate to keep beating on the employee gong, but when I go to the local BestBuy, employees look so soulless and that in turn makes me feel bad for coming to your store in the first place. No one is happy to be in a BestBuy. I can't put my finger on it exactly but it just seems so, loud, dull, and annoying at BestBuy.
5. I miss CompuUSA and for some reason or another, I always go into BestBuy looking for computer parts first, until I realize, oh yeah the selection is pathetic at best. Of course, people say that I could just jump on the Internet and ask them to ship whatever to the store, but if I get on the Internet, I'm not surfing over to BestBuy.
6. Yeah that whole Amazon.com and them not collecting sales tax, yeah that's a big problem for BestBuy. I have no idea how they get away with it but I've seen lot of friends head to BestBuy to look at the product, yank out phone, and order the exact same thing from Amazon. They like it because it is usually free shipping and by paying no sales tax, they usually save about $5.00 to $20.00. (Local sales tax being 10%)
I've got no idea how BestBuy can turn the tide, but it sucks to walk into a BestBuy. It's not a very happy experience.
3rd gen American here, I'm seriously considering which country to move to.
I am Bennett Haselton! I am Bennett Haselton!
Nice to see that at least in some places, senior management are held accountable for their performance.
CEOs should be no different to football managers (as Chelsea fans can attest). If you get the big bucks, you have to expect greater scrutiny of your performance, be held to higher standards, and be held accountable.
A step in the right direction, I think.
I live in semi-rural Wisconsin, and the closest Best Buy is 40 minutes away. It has literally been years since I last set foot in a Big Box store. Best Buy has never been the best place to buy electronics. Stop acting like Best buy is doing some sort favor to flyover country, and the curious people that inhabit it. The Internet is and always will be the best place to buy electronics.
Amazon play their delightful tax avoidance antics in the UK too.
As businesses go transnational, so should tax collection. We could abolish tax havens and "tax competition", stop these overgrown bums from freeloading off society everywhere, and use some of the clawed-back proceeds to give every child on Earth clean water and a decent primary school education.
With the added bonus that it would drive libertarians, Randroids and social Darwinists absolutely crazy.
Awhile back, I went around town trying to find a PCI wireless NIC card.
I went to radio shack and bewildered their employees, as if I was speaking some foreign language.
I went to Best Buy and they told me I didn't need that silly thing, and tried to sell me this shitty looking USB adapter.
Finally, I found what I was looking for at Fry's, and the employees there weren't huge dicks/morons.
Guess which store got my business?
What do I know, I'm just an idiot, right?
I wonder how much longer until they are bought out by Amazon. They'd probably sell off the retail operations to the highest bidder (I'd speculate Target), and go nuts with the bestbuy.com domain name et al' circuitcity.com
Most likely, this will happen at a bankruptcy auction. Even though BB's # are slipping, they're still pretty substantial. Of course, so are RIM's....
No man is an island, But if you take a bunch of dead guys and tie them together, they make a pretty good raft.
So, what I read here is: Amazon didn't kill Best Buy. Sales tax did.
In reality, many factors came together to do in Best Buy. Sales tax being just one of them. And many of those factors in turn work to benefit on line retailers. So perhaps your legislators and regulators need to think carefully whenever they get some new ideas about enhancing revenue or imposing mandates on their local businesses.
Have gnu, will travel.
Their customer service is bad. Their sales clerks are trained to be pushy. Their prices are just so-so.
No big surprise.
I agree with all the above. And I'd like to add that is pisses me off royally when I leave the checkout line (after waiting), take a few steps to the door only to have some dork blocking my exit and demanding my receipt.
So, Best Buy treats me like I'm a thief. I am not a thief and therefore, Best Buy is staffed by a bunch of liars.
Insinuate that I'm a thief then I'm calling you a liar - like Best Buy.
I don't do business with liars.
Most people are attributing the Best Buy decline to the internet, but even more than you I think that Wal-Mart's aggressive push into Home Electronics is the primary factor.
I worked for Best Buy from 1999 to 2001. They were a pretty good company back then. The only thing they really pushed us to sell was the extended warranties... excuse me, protection plans. I really enjoyed working for the company. I stayed in touch with my former co-workers that stayed on with them for many years after I left. According to them, Best Buy's policies got worse and they became a pretty bad company to work for. They got super high pressure with everything. I actually interviewed with them again in 2009 but ended up turning down the job offer. I didn't like what the company had become.
Actually, if you've been into a BB lately, you might have noticed that at least 70% of the floorspace is taken up selling what you might call "hardcopy media". Stuff like movies, music, and electroic games. All things that are increasingly being purchased online these days.
For a while I had hope for them when they starting reserving a good chunk of space for selling actual equipment for musicians. That seems to have been a fad though.
They still are my favorite place to shop for computer games (yeah, I'm old-school that way), but they've countered that by shrinking their selection down to about a shelf or two. :-(
If they honestly don't see any problems with their current operations, policies, or procedures, I don't see how they can expect anything other than more of the same decline.
Last December I was shopping for a TV and cruised through Best Buy to check out their sales. They had a reasonable looking TV that had just gone on sale at a very good price, but like any tech geek I wanted to do some comparisons before buying. It was one of their house brands, but the price and reviews compared favorably to similar TVs from other manufacturers. So the next day, my wife stopped by to pick up the TV.
One problem, though. Best Buy pulled a bait-n-switch on her.
They had been advertising the sale price for the TV I had seen. But sometime in the ~24 hours since I had been in the store, they brought in a pallet of TVs that looked identical to the one I wanted, but these had weaker speakers and fewer inputs. They marked these TVs at the same price as the one I had seen the day before. My wife went in to buy the TV, asked for the TV on sale at the specified price, and they gave her the inferior model.
I looked at the model number before opening the box and saw the error, so I packed the TV and my toddler in the car (the wife wasn't home) to exchange the TV for the correct model right away. Before going to customer service I surveyed the electronics section. Sure enough, there was a pallet of TVs of the lesser model that had not been there the day before. Not far away was the shelf with a handful of the TV I saw the day before on sale for the exact same price. I went to CS, toddler in tow, to make the exchange. The CS person was, to her credit, was very accommodating. But the slacker she sent to bring up the right TV took 20 excruciating minutes (my daughter HATES her car seat) and a reminder from the CS associate to get the new set out to me.
Unfortunately, this seems to be the way things are going. There will be one or two "retailers" left on the Internet which will be in unassailable positions because of heavy discounting on freight and committments from suppliers. Buying anything locally will be an option fondly remembered by grandparents and a concept utterly foreign to the next generation.
Why will there be only two? Well, Amazon ships with UPS and UPS charges them so little based on volume that they can make money offering free 2-day shipping. Should some new player come along they aren't going to get discounts like that until they have a huge volume, which means their prices will be higher, meaning they aren't going to get that huge volume. Same thing with suppliers: if you buy 1,000 TVs from Samsung they give you a different price than if you buy 100. If you sell 1000 a week you are going to be buying a huge number - maybe more like 10,000 at a time - and get such a better price that they new start-up can't ever get that good a price.
So what do we have now? A monopoly. Mostly driven by the Internet and the way shipping works in the US. Best Buy had their own fleet of truck for distribution so their costs were quite different than using UPS or FedEx. The idea that some new startup can come along - as Best Buy did - is pretty much gone. The market is closed to new entrants. Would there be room for two such distributors? Maybe not - we might end up with only Amazon as the big retailer in the US and WalMart for low-end stuff. We can all see that the small independent seller is doomed if they haven't already closed up shop now. WalMart put those folks out of business a long time ago.
You can certainly say that Best Buy failed in providing customer service, but we are seeing a passing of a lifestyle. We are also seeing an interesting phenomenon whereby more and more things in people's daily lives are being supplied through a single source. Did you know there is only one factory in the US making glass bottles? If one can do it, why have more, right? Except it is a single point of failure and there are many substances that a glass bottle is required for. If that one factory has a fire or some other accident the entire US is without glass bottles for perhaps a very long time. With retailers being eliminated we are focusing more and more on online retailers and two shipping companies - of which there will only be one in the end. When it is only Amazon and FedEx (far more diversified then UPS and therefore the more likely one to survive), what happens if there is a strike against FedEx? Well, it means people stop getting stuff. When it is WalMart and Amazon alone and everyone is getting food, clothes and everything else through these channels what does it mean?
One big thing it means is that if the buyer at WalMart doesn't like some supplier, their stuff isn't getting sold in the US. It means decisions that consumers get to make today are then made by the buyers for the retailers that are left. If the buyer doesn't choose it, the consumer can't choose it. Period.
Oh, you think "the long tail" will solve this problem. Not really. There will be only a few retailers because the dynamics of an online store are quite different from opening a little shop on Main Street. It is already pretty much impossible for an upstart to compete with Amazon today and it isn't going to get any better. Which means if Amazon doesn't strike a deal with a supplier - on Amazon's terms - their stuff doesn't get sold. Manufacturers are ill-suited to sell things directly, so that isn't really an option. Neither is Amazon going to take on a new product that completes with an existing high-volume product unless they get a really good deal - why trade dollars for pennies? This puts Amazon in control of what brands of toothpase you get to choose from - you will not have the option of going to a different store.
Pretty sad, isn't it. At least it isn't the government making these decisions for us.
Best Buy may not be Shangri La, but in many rural and semi-rural parts of the U.S., it's the nearest and best place to actually find a wide selection of electronics.
I live in a huge metropolitan area and the best place to find a wide selection of electronics is the internet. Isn't this the same for rural people?
I've got news for you: they may already be worth $0.
Most gift cards have a so-called "maintenance fee" which deducts money from them monthly after a certain period of time, like a year or so. $1/month can really add up fast on a $50 card. Go check them right now by whatever method is printed on the back of the card. This isn't just Best Buy, it's the whole gift card industry.
#naabhaprzrag, #sverubfr-000, #agi-fcbafberq, negvpyr[pynff*=' negvpyr-ary-'] { qvfcynl: abar !vzcbegnag; }
Hope they go tits up and close every single Best Buy store out there. That way maybe, we can start seeing some competition out there again. Best Buy set the standard for poor customer service and bred a culture of ignoring the customer and giving false information in order to lead the customer into buying things like $100 hdmi cables and extended services contracts. They may not have been the first company to do all of this but they certainly perfected it and made shopping for computers and electronics a fucking horror show. My wife and father in law still won't step foot in a best buy with me after the experiences they have had there. So again let me call out. Burn motherfucker Burn.
If you wanna get rich, you know that payback is a bitch
I went to Best Buy the other day to get 2 gigs of DDR2 PC2 5300 RAM for my laptop, something that costs $12 on newegg. I needed it sooner rather than later, so I figured even if it cost $25-$30 I'd buy it for the convenience of having it a couple days sooner than ordering it online.
First, I asked an employee where they were. He lead me to the laptop RAM, picked up a desktop stick, handed it to me, and walked off. I of course put it back and looked through the selection, only to find there weren't any 2gb sticks, but only 2x1gb sticks. Still I wanted to buy it and it was only $30, so I get to the register and the kid rings me up at $55. Turns out $30 was the price of 1gb and the 2x1gb was hanging in the wrong spot... they wanted 55 freaking dollars for 2x1gb of old outdated RAM. Obviously I left Best Buy without RAM in hand and ordered straight from newegg. It arrived in 2 days for $13.71 including taxes and shipping.
So now you're trying to tell me that taxes are killing best buy? I gave them plenty of opportunities to make a sale. After driving 15 minutes to get there, terrible customer service, terrible selection, inaccurate prices, I was still willing to buy from them. But all that, AND they are trying to gouge me on an item I KNOW I can buy elsewhere for 75% less... no, it's not sales tax; they have it coming and have only themselves to blame.
I know they are hated, too, but I love the Fry's by my work over any Best Buy. Still have individual electronic parts. An entire aisle of just motherboards on one side and cases on the other. Porn aisle displayed proudly front and center. There's a corner with multimeters and oscilloscopes.
And they route everyone in line past about 1200 feet of last minute impulse snack items. I know that's usually seen as an underhanded technique, but it's so over the top at Fry's it achieves awesomeness.
Yeah, Fry's takes "defective" return, puts it right back on the shelf. If Fry's does that ten times per item, Best buy should do that twenty.
Since people are already using brick and mortar stores as showrooms to try before buying online, maybe that's what BB needs to embrace in order to survive. Stop holding vast inventory, trade in big stores for smaller spaces that focus on social events centered around technology, and affiliate themselves with online merchants rather than fight them to their inevitable death. Imagine a place where you get to experience the future high tech house/bar/coffee shop/office. It's slicker than an Apple store, and everything you touch is a product you can buy. Snap a barcode with your phone and you're taken to a BB site where you can post your reaction/experience to facebook along with a link to buy (with BB taking commission). Couple hundred clicks/likes and you get a discount to any of their authorized affiliates.
*inb4 crappy 5 minute ideas get ripped apart :)
your thin skin doesn't make me a troll
I don't subscribe to the notion that retail is dead. Best Buy's problem is that their stores haven't changed much since the 90's, and has crossed into severely dated territory. When I see a Best Buy sign, I don't think "future." I think bulky, crappy HP laptops for $399. I think of peripherals sections that don't actually carry the latest peripherals, and horrible washed out LCD monitors from 6 years ago still on display. And huge swathes of space still dedicated to GPS units, boxed software, and DVD's. Stereos and TV's all blaring at me, giving me a headache after 30 minutes.
I used to love going there. Now I hate it. I almost prefer the electronics section at Target.
There are entire malls of big-box stores. I once drove into one in Fremont, CA. They have a Best Buy, a Lowes, an Office Max, a WalMart, a Babies R-Us, a Smart and Final, a Sports Authority, and a 25-screen theater. The parking lot is all SUV-sized parking spaces. Instead of shopping carts, they have industrial flat handtrucks. There are no small stores other than chain restaurants. They'd just be in the way.
I'm suprised this monster has survived the recession.
I have to point out one thing here: This is all regional. UPS, Fedex, and USPS all have good and bad regions. Sometimes it can be down to the driver of your particular route.
One difference I've seen, at least in my area, is that Fedex ground is a different organization than Fedex air; different sorting centers and everything. UPS is 'all in one'. Fedex Air has the best drivers, UPS is middle ground, Fedex ground is the worst.
Thus if I'm shipping something fast, I'd go with fedex, slow UPS.
I don't read AC A human right
Yeah, I had the same reaction. Maybe change the statement to "MANY users aren't comfortable buying parts online - they want a salesman to tell them exactly what to buy".
You know what I always tell people that my real job is? Reading. It ain't TS, it ain't SysAdmin. It's reading and researching on how to do something - that's it. Understanding and interpreting the instructions to those who, for whatever reason, lack the ability or the desire to do it themselves. I'll direct those who haven't seen this to this handy chart:
https://xkcd.com/627/
Yay - computers de-mystified. Of course there is the theory behind how things work, troubleshooting methods, anticipated expected behavior, etc, but to a large degree this chart tells the real story many times over.
If I have to give a wack at rewiring portions of an engine's electrical system, or changing out a compressor in a fridge (both RL examples for me), do I have any inside knowledge on what to do? Nope. I google up some shit, use some logic and test it out, with the knowledge that I really DON'T know what I'm doing. If I find I am digging myself a hole, I (usually) have the humility to call it quits before I lose the patient for good. Then, when I call in an expert for help, I have a bit of background on the issue, which hopefully will give the repairman incentive to just fix what is wrong instead of taking me to the cleaners over it.
This doesn't work all the time obviously, but its true enough - at least, I have found so. Non-nerdy people, hear my voice! Wanna not get fleeced, constantly? Do a bit of research and read before you plunge into an unknown pool. The frustration (and cash) you save may be your own...
"As the intrepid kobold companion continues his journey, he begins to wonder... if priests raises dead, why anybody die?
Let me first start out by saying that I am not the typical BBY employee who pushes nonsense to people, I don't nag nor do I hover over people. I do welcome them into the store and into the Computer Department and for the most part I do know if they would need more help then the next guy. I have current customers who will stay and wait 45 mins to speak just to me because I do not sell crap or things no one needs.
When it comes to prices, Best Buy actually makes no in store profit on Computers, what we do make money on is the accessories or addons per se. I have been there for almost a year and I loved it until perhaps 6 months ago. The managers don't have a clue on anything that is happening in the store. They stay in the office socialize and play on the phone and when the next round of numbers come in and we are not making numbers then we get a talking. When it comes to bonuses they make much more then we do. Our store in particular is the highest rev store and we have not hit bonus in several years, but the managers have. The management has no sense of style nor do they have an leadership ability what so ever. I am a so called Solution Specialist and when I have to force paper work to my customer and then talk about all the things they DO NOT need it upsets me. How the hell do you expect me to sell a Geek Squad Tech Support Service to a man who is in IT Operations? A Cheap HP printer because its only 30 dollars, the ink itself is worth more then the printer.
Before reading this article I sent a few applications out to some IT companies I cant wait to get out.
America has spent the last few decades transferring massive amounts of wealth from the middle class to the wealthy. The middle class is shrinking, the ranks of the poor are growing, and we have reached the point where half of Americans are living on twice the poverty level or less. Many large corporations such as Best Buy have spent a lot of money to bring this about, and now that the middle class is shriveling, there are fewer customers with sufficient disposable income to purchase thousand dollar televisions.
This is hardly the only reason Best Buy is in trouble. It is but one of many. But many of those large corporations who have worked so hard to screw over the middle class are dependent upon the middle class having enough disposable income to buy their products, and now the chickens are coming home to roost.
Seriously, I make a living off ex-geek squad customers. I run a small one-man computer repair / virus removal business. Can't tell you how many PC's I fix and find Geek Squad fingerprints all over it. One lady called me in a panic because GS had quoted her $1300 to "repair" her unbootable PC ( new Motherboard, new hard drive, new RAM ( WTF?) and a new power supply.. I fixed it for a flat $75 by running chkdsk on the drive and cleaning off the virus. She's still my customer to this day and I've easily made a grand off her over the years, migrating data, removing new malware and viruses as they come up (gotta love teens )
I have a simple business model that geek squad can't compete with.
1) I do it better for less. I pick up and drop off too, if you dont want me to stay at your place and work on it rt.
2) I WARRANTY all my work- ie: if for whatever reason you aren't satisfied, I'll make it right, NO CHARGE, no argument and no hassle.
3) you get ME every time you dial my business number, not some kid that worked the fry basket last week. I can rmember the ongoing issues with your stuff.
4) this is the biggie: I will do everything I can to recover your data, BEFORE I format it and reinstall. Even if I have to spend an extra hour with a ubuntu bootable disk picking it off the disk and putting it on a backup drive.
I've around 350 regular clients, some have been with me for 7 years. They're my bread and butter. Most of them despise GS, and by extension, Best Buy. Customers have a long memory for getting screwed.
We need the People's Red Revolution First October Industrial Combine and Electronics Collective designed to sell exactly one model of every item. And it's always out of that one model. And if they have it it's overpriced. And may catch on fire. All Hail.
CEOs/managers always get bonusses when the company makes lots of profits (most likely not because of the those managers but because of the general economy).
;-) ), he is charged $5 million, or more,,for his obvious incompetence?
So now I wonder if through his obvious bad leadership (general economy is never the main influence otherwise there would be no bonusses, therefore it can't be used as a cause of bad performance either!
No, Sales Tax didn't kill Best Buy - if anything you could say Sales Tax EVASION killed them. In most states you owe sales tax on products you buy over the Internet (called a Use tax).
But their dependency on low cost, low margin items (competing against WalMart) and boosting profits with expensive accessories that people aren't buying and their dependency on dying high margin physical media sales (going to downloads) has to hurt. Incidentally, all of their competitors seem to be doing fine, even some that have some of the same problems (like Fry's poor customer service).
What?! 70%? By lately do you mean 10 years ago??
A couple years ago Best Buy stripped out their movies and music selection in favor of more floorspace to sell cell phones and TVs and expand the gaming section.
If anything it's more like maybe 25% floor space is taken up by media and games. And that's pushing it.
Its a question of (perceived) equity. People used to put up with sales taxes because they are (largely) uniform and flat. Warren Buffet pays the same sales tax as I do for the same burger. This is breaking down because of the local nature of sales taxes and the Internet's ability to circumvent this. Why pay the tax when going on line gives me access to the same lower rates that others enjoy? Something similar has been occurring for years near the Washington State/Oregon border. People from WA (sales tax) hopped across the border frequently (distance allowing) to shop in OR (no sales tax). Not so much because they perceived the tax as unfair, but the privilege of OR residents as being somehow inequitable.
Income tax isn't disliked so much because of the annual hit. Most people don't incur a once a year hit (many get a refund) as much as an annual reminder of how inequitable the system is. Plug the loopholes with a flat tax and people won't be as upset. Eliminate the differences between how corporate and individual deductions and loopholes are structured and people will think of them as more fair. Why should a corporation be able to depreciate the corporate jet that they use to ship in hookers and blow but I can't do so for the minivan I use to haul the kids around?
Capital gains taxes are disliked for a slightly different reason. Given that a different class of people tend to pay most of them (The wealthy. Cap gains on the big middle class asset, your house, has its loophole to placate the voters.), the issue of fairness and equity is evaluated from a different point of view, namely the world. The middle class judges equity in relationship to neighbors or people in the next state. The wealthy look at how cap gains are handled around the world. And the horrible truth is: the USA has one of the worst cap gains tax rates on the planet. In many countries, there is no capital gains tax. In those that have one, its rate is lower than that for normal income. At the moment, we happen to be in a cap gains "holiday" in the USA, given the temporary lower rates (which bring us into line with most of the world). But that may soon disappear and we'll be back up to the (highly variable) income tax rate. The wealthy and corporations with massive assets parked offshore are watching this situation carefully. Until the cap gains rate is brought into line with that of the rest of the world permanently, those assets are staying overseas.
Have gnu, will travel.
Instead of having a team of pushy showroom employees, turn the back ends of the stores into warehouses, and have a smaller front end room with just a few choice gizmos on display, the Geek Squad window for repairs, and the CS/sales counter for when people actually have questions. Turn that warehouse space into a long-tail business plan: Stock everything advertised online back there, so instead of people coming in and using your giant shiny store as a shopping window, they can pick it out that day from the kiosk, have an employee grab it from the back, and and take it home. I swear, their "online only" products are the biggest turnoff for me of all. Why does a ten dollar, tiny USB wireless dongle-nub have to be online only? You could have a box of a hundred of them in the space hogged up by one overpriced HDMI cable!
The reason we shop at Best Buy is because we need something today, or it'd cost too much to have it shipped (e.g. washing machines.) They need to seize onto that mood and rebuild the stores around the actual customer draw.
Occasionally living proof of the Ballmer peak.
the last time I ever set foot in a CC was when I went there to buy a hard to get CD. I was standing at the counter for five minutes with the CD in one hand and cash in the other. When no-one showed up to take my money, I put the CD onto the counter and left.
It's surprising in this day and age someone at the top of a billion dollar company can't see what is so blatantly wrong with their company that they could easily fix it. All they have to do is go to one of their stores incognito and attempt to shop there.
1. Stop upselling, train staff to be courteous and informative, rather then preying on those who don't know better. Offer customers relevant information on whatever they're buying in close proximity to what they're buying, like different display technologies for TVs and monitors, pros/cons, that sort of thing.
2. Change prices so they're competitive with online with a markup that covers the costs associated with having a retail store.
3. Carry a range of devices, not just the top of the line monster cable (something high, low and medium end). You don't realize how expensive cables are till you buy one off amazon, even cheap ones.
4. Make sure your stock is up to date. Buying a graphics card that is two generations old for the original retail price is beyond stupid. Best Buy should neither be proud of selling these or having people buy them.
Then advertise what you no longer doing and how you've changed to bring in customers (this will only work once and it will most definitely be a huge PR incident if you haven't changed).
It's that simple. This would change their sales immensely... Where is my million dollar salary?
What components? You have two connectors and a length of raw cable. Just about everyone uses the same raw cable stock, and everyone gets the ends attached in China.
In an HDMI cable you need to pass a digital signal. Even the cheapest monoprice cable will work fine for short runs, and if there's a bad connection it's obvious and you chuck it and replace it. The ONLY time the quality makes a difference is in long runs (like 40 feet or more to a projector) that are hard to replace. In that case I'd be tempted to get the Belden stuff from Blue Jeans Cable.
Stop trying to make a profit by tricking people into buying stuff they don't need; it only breeds ill-will when they discover the truth. As a short term strategy it works, but if you're not an itinerant conman, then you're shooting yourself in the foot.
I would be a lot more likely to patronize Best Buy if they could do what amazon does for me: make me feel like I am sticking it to The Man by not paying sales tax.
When amazon is finally taxed in my state, MAYBE my shopping habits will change. And, they might not.
I have a modest budget of $X for random silly crap each month... and I always make sure my dollar goes as far as it can go by purchasing on amazon and being patient with free shipping. When a portion of my $X budget has to go to taxes, I will buy less. It's just how things are. There will be fewer Blu-Ray Disks, CDs, video games, whatever, sold and the government will get a little more money to waste.
A client recently had a PC fail under warranty, so I took it in to the local Best Buy where they purchased it for repair, hoping to save them time and the costs of packaging and shipping. It likely needs a new motherboard. Three times they have failed to repair the verifiable, duplicate able issue, eventually telling me there was nothing more they could do. They've emailed me service surveys where I've expressed my dissatisfaction, and asked to be contacted. They have not contacted me. I ended up sending the machine to the manufacturer, and won't make the mistake of taking a machine to BB for repair again.
Everyone I talk with has a Best Buy horror story.
Sure, I do. I bought a laptop in 1999 and foolishly bought the extended warrantee. Within the warrantee period the keyboard started dieing a key at a time. I had the keyboard replaced and the 3rd party that handles their warrantees just straight refused to pay up. No explanation, no justification, just baldfaced stonewalling. Cost to me: $200 for the warrantee plus $150 for the keyboard. For that reason alone I am happy to hear that Best Buy is well on its way to the great trash heap in the sky.
Have you got your LWN subscription yet?
Back in the mid 1990s, I knew a fellow student in my CS classes that worked at Best Buy. One of them was telling a story to the class about how Best Buy was marketing power strips as Windows 95 compatible. We were all rolling in our seats laughing. It seemed so ludicrous that anyone would believe that a simple run-of-the-mill power strip cared what was plugged into it and yet the student said they were flying off the shelves compared to other power strips. All we could do was shake our heads.
...quicker, easier, more seductive the darkside is...but more powerful, it is not.
So, did they give the executive a multi million golden parachute bonus to leave the company, like it seems so many companies do? I have not been in Best Buy in years until about a month ago. I will not return ever again. Of what I remember about the bad customer service at Circuit City, Best Buy is far worse. The store management people are real idiots, and it took me calling their 800 telephone number to get real help from them. Good by Best Buy..... You will not be missed at all by me or my friends,
I am pressured to attach high margin items by management. I am presented with numerical figures that support this strategy as ligitimently necessary for the long term survival of the company. It is difficult for me to attach these services, but i do make sure each customer is aware of their existence and i do try to tie it in to the points i am instructed to listen for in order to present the service's value. There is a second part that i usually skip. Management calls this "Overcoming Objections" and they are very vage as to what it really means. I have seen my co-workers do astonishing bits of social entering for a near mystical increase in attach rate of these value added services while mine just barely eek by the company average on a good day. However, i have never seen one of my co-workers flat out lie, as has been alleged several times in the comments i have read. However, management very, very strongly makes sure that we know to never misrepresent a product, because if it doesn't do exactly what we say the customer will return it and we will be out that margin, plus the open box discount if we even manage to sell it again. I give my customers a lot of data, and i get a lot of repeat business. However, this is usually from customers who have questions rather then those who are looking to buy. I have access every day and week if i request it to a detailed break down of the sales figures BestBuy's system has for me. Every day i go in with a bit of pride because of one of those numbers: returns. Out of every customer i've ever personally helped, 0.3% of them ever return anything. (i fully expect to be fired though, i'm honestly a horrible salesman) I think that BestBuy needs to reinvent itself to stay afloat. A few days ago I asked management about the state of the company. There is a firm air of denial in the retail outlets. I got a careful explanation about the losses posted as normal business expenses. Namely that the company had acquired some sell phone retailer overseas for something like 4 billion USD and that the retail side of things had been nothing but profitable. However, today i see the CEO has retired. This doesn't hold up to the story i was told. I wonder how much longer i'm going to be able to hold this position, it's been an interesting look either way. A year ago i'd probably be yelling about lying sales people too, but seriously, we're just... people. We don't enjoy what we have to do, even those of us who are particularly good at it. The top seller in my department hates how people react to him. Most of the time, the moment we go into services, even if we have been nothing but helpful and informative, people sour to us. I can understand this feeling, especially if someone is acting pushy, but honestly he rarely does. There is this huge stigma associated with salespeople, and even if we are just presenting a service as a viable choice (my managers probably hate me for this, they tell me i should stop asking my customers how they 'feel' about things. I just present the thing as truthfully and as relevantly as i can, then give them all the time they need to decide) we still get a measure of scorn for having the audacity to offer Accidental Damage from Handling or Technical Support, because the programs are clearly a scam (... geek squad's tech support is debatable depending on the guy you get, i'll admit that.). But seriously guys... we're not trying to screw you. Not even management really wants to screw you. We'd just prefer to make money... on every single opportunity we can... because we're a product of capitalism as an entity. But we're usually polite about it, and at least for the store i work at, i know nearly all of my co-workers are intelligent, truthful people I hope i'll do better as whatever i finally end up deciding on when i finally graduate. I hate having varied interests sometimes. .... also, entirely off topic, please remind people who rip open iPad/Tablet/Ereader/Handheld game console cases and just leave them on the floor to at least put them back to
Among all their crazy articles, Cracked has some deep ones:
http://www.cracked.com/article_18817_5-reasons-future-will-be-ruled-by-b.s..html