UPDATED: Best Buy CEO Resigns, Company Now Citing "Personal Conduct" for Departure
April 10, 2012 1:02 PM
Best Buy is in a tailspin and looking for a new leader
The body blows just keep coming for “big box” retailer Best Buy. The brick and mortar electronics retail giant has
outlived competitors like Circuit City
, but has faced increasing pressure from companies like Walmart, Sam’s Club, and Costco which have greatly expanded their electronics offerings in recent years. In addition, Best Buy has been experiencing
tremendous pricing pressure
from online giant Amazon.
In late March, Best Buy announced that it would close 50 of its roughly 1,100 retail stores in
an effort to save $800 million
. In addition to the workers displaced by the store closures, Best Buy also announced that it would eliminate 400 "corporate" and "support" workers.
Today, we learned that the number of people getting the axe has increased by one. Best Buy CEO Brian Dunn announced his “resignation” today. In this case, resignation most definitely means that Dunn was pushed out due to the company’s poor performance (the company has lost roughly half of its value in the past two years).
For its part, in a statement, Best Buy concluded, “There was mutual agreement that it was time for new leadership to address the challenges that face the company.”
“I have enjoyed every one of my 28 years with this company, and I leave it today in position for a strong future. I am proud of my fellow employees and I wish them the best,” added Dunn.
Dunn's career started at Best Buy in 1985 as a sales associate and he worked his way up the corporate ladder over the years. Dunn has served as Best Buy's CEO since June 2009.
Former Best Buy CEO Brian Dunn [Source: Marketwatch]
The search is on for a permanent CEO, but in the mean time, Director G. Mike Mikan has been named as interim CEO. “The Best Buy team and I will be extremely focused on successfully managing this period of transition. I want to assure our employees, customers and other key stakeholders that we will work together to achieve our company’s growth and profitability goals,” stated Mikan.
A large portion of Best Buy stores are dedicated to physical media that is being ushered out and replaced by streaming/downloadable digital content. In addition, many of the digital convergence devices that Best Buy sells (smartphones, tablets, etc.) are being used by consumers to find much better deals on products online.
For many tech nerds (and the general populous), Best Buy has been “reduced” to simply being the physical showroom for online retailers like Amazon and Newegg.
Updated @ 6:16pm
While the miserable financial performance of Best Buy over the past year would be reason enough for Brian Dunn to get the boot, the
Wall Street Journal
reports that some other unsavory details are behind the resignation. The company released the following statement:
Certain issues were brought to the board's attention regarding Mr. Dunn's personal conduct, unrelated to the company's operations or financial controls, and an audit committee investigation was initiated. Prior to the completion of the investigation, Mr. Dunn chose to resign.
Wall Street Journal
"Nowadays you can buy a CPU cheaper than the CPU fan." -- Unnamed AMD executive
Best Buy Reports Earnings, Announces the Closing of 50 Stores
March 29, 2012, 1:26 PM
R.I.P.: Circuit City Closes Forever on March 8
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