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Changes will come in next 3 to 5 years

The world of retail electronics has changed drastically over the years. It used to be that most people were going to retail stores to make a purchase. Today, many people go into a retail store to see how a device works and research an item, then go home to purchase it online. The reasons for this are many, but much lies with the lower price that many gadgets can be found for online.

The largest consumer electronics retailer left in the U.S. is Best Buy. Best Buy is still facing stiff competition on the market with Wal-Mart, Target and other discount chains selling more electronics than they did in years past. Best Buy currently operates a number of large stores that its calls “big boxes”. These stores range anywhere from 20,000 square feet to 58,000 square feet.

According to Best Buy, these stores have huge overhead and are "white elephants" in the industry. The retail chain is looking to cut the amount of space and overhead these stores have by about 10% over the next several years. This comes after three straight quarters of same-store sales decline and a forecast for more declines in sales. The blame is placed on the Best Buy’s ailing TV business.

Analyst Scot Ciccarelli said, "I do believe that a lot of their bigger box stores have to be downsized. If there was a disappointment, I was kind of hoping they would be even a little bit more aggressive than what they outlined." He continued saying, "It's [the size reduction] not that big for this company. What I think you really need to do is maybe downsize a little bit quicker."

Analyst David Strasser from Janney echoed Ciccarelli saying, "We believe the Street wants more. We look at this as a first step that shows us the company is looking at reductions."

While Best Buy is seeing same-store sales decline, it is trying to grow it online business significantly. Best Buy wants to double its online sales from the current $2 billion over the next three to five years. Best Buy CEO Brian Dunn said, "The online channel is our greatest growth opportunity."

Dunn did note that retail was a part of Best Buy and defended its retail brick and mortar presence. He said that stores augment online. While Best Buy is looking to shrink its big box stores, it plans to increase the number of small stand-alone stores like Best Buy Mobile offerings to between 600 and 800 within the next five years.

Best Buy also has plans to grow operations in China and is pressuring U.S. lawmakers to force the collection of sales tax to help "level the market".

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RE: First area of the store that needs to go...
By cknobman on 4/15/2011 3:44:46 PM , Rating: 1
Monster cable may have had some negligible difference back when everything was analog (component, composite) but now that most cable carry a digital signal Monster cable dont do squat except provide you with a pretty shroud and a super high price.

The shroud and extra insulation may (and I say may very lightly) have a super small impact when the cable lengths become extreme.

Other than that Monster cables are for suckers that walk in and are stupid enough to listen to the pre fed Best Buy salesman garbage.

I know because I worked for Best Buy in college. Best Buy was a crooked scheming company that swindled customers and brainwashed employees.

RE: First area of the store that needs to go...
By Xaussie on 4/15/2011 5:35:29 PM , Rating: 2
You can hide a lot in the smoke and mirrors of analog signalling but Best Buy employees assured me I would need an extra high bandwidth HDMI cable to support a 240Hz TV. When I tried to explain that the 240Hz TV was simply taking the same 60fps signal that every other TV takes and interpolating and displaying intermediate frames internally, I got a blank look followed by an assertion that he had his information direct from the Monster sales rep so it must be true. It annoys me that a lot of people out there don't have computer design backgrounds and will fall for this, it's simply dishonest.

By Reclaimer77 on 4/15/2011 5:36:33 PM , Rating: 1
OMG are you serious? He told you that?

Sigh...that's criminal lol.

By mead drinker on 4/15/2011 11:07:48 PM , Rating: 2
Why would you care about the 240Hz feature on your TV anyway?

"This is about the Internet.  Everything on the Internet is encrypted. This is not a BlackBerry-only issue. If they can't deal with the Internet, they should shut it off." -- RIM co-CEO Michael Lazaridis

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