Best Buy UK Goes Under
November 7, 2011 12:05 PM
comment(s) - last by
Best Buy purchases Carphone Warehouse portion of Best Buy Mobile U.S. operations
The consumer electronics market is still feeling the pinch of the poor global economy. Best Buy was able to help put
Circuit City out of business
in the U.S. a few years ago, but it is now facing its own mortality in the United Kingdom. The Best Buy UK stores were a joint venture with Best Buy and Carphone Warehouse. Carphone Warehouse is a seller of mobile phones and other devices in the UK.
Best Buy UK stores are being shut down because the business continues to lose money. The losses before tax and interest in the six months that ended on September 30 amount to £46.7 million, almost twice the £28.8 million loss the previous year.
Interestingly, customers found the stores very appealing and gave Best Buy UK locations high marks for customer service.
Carphone Warehouse Group CEO Roger Taylor said, “The eleven Best Buy UK ‘Big Box’ stores have performed exceptionally at the level of customer satisfaction, but they do not have the national reach to achieve scale and brand economies. Due to the lack of visibility of an acceptable rate of return on historical and future potential investment, we have decided against rolling out more ‘Big Box’ stores and we will be closing our existing stores, subject to consultation with our employees.”
The first of the Best Buy UK stores was in Thurrock, Essex and opened in May of 2010. Carphone Warehouse will now expand the Wireless World stores to offer more products with a new range of connected devices. Best Buy has also announced that it will be purchasing the Carphone Warehouse holdings in the U.S. mobile phone joint venture. The purchase of the Carphone Warehouse portion of that venture will cost Best Buy $1.3 billion.
Analyst Anthony Chukjumba from BB&T Capital Markets said, "For Best Buy to be able to no longer have to share 50 percent of the profits of a high-margin, fast-growing business with Carphone Warehouse, from my perspective, is a real positive. (But) it is not a game-changer. Best Buy still has the same challenges they did 24 hours ago -- fairly weak product cycle particularly in flat-panel TVs, increasing competition from Amazon, probably too much retail square footage."
This article is over a month old, voting and posting comments is disabled
11/7/2011 12:23:08 PM
Nuh nuh nuh nuh, nuh nuh nuh nuh, hey hey hey, good bye.
"Let's face it, we're not changing the world. We're building a product that helps people buy more crap - and watch porn." -- Seagate CEO Bill Watkins
Report: Circuit City Mulling Closure of 150 Stores, Massive Job Cuts
October 20, 2008, 3:02 PM
Apple Starts Battery Replacement Program for “Very Small Percentage" of iPhone 5 Smartphones
August 23, 2014, 8:28 AM
No Free Play Day for You! Microsoft Says Apparent Promotion was an Error
August 22, 2014, 2:50 PM
BlackBerry Passport to Feature Snapdragon 800 Processor, 3,450 mAh Battery
August 22, 2014, 2:05 PM
Moto X+1 Press Renders Leak, New Images Show Schematics for 4.7", 5.5" iPhone 6
August 22, 2014, 9:52 AM
BlackBerry’s Latest "Plug" for its Passport Smartphone: Displaying Sharp X-rays for Doctors
August 21, 2014, 4:49 PM
Sprint Introduces $60 Unlimited Plan, Touts $20/Month Costs Savings Versus T-Mobile
August 21, 2014, 2:05 PM
Most Popular Articles
Apple Scores Patents, Preps New Reversible USB Plug for iPhone 6 Connector
August 18, 2014, 1:32 PM
New AMD Fusion-Based Laptop From HP to Pack a Punch at $199
August 18, 2014, 4:13 PM
BlackBerry Reinvents Itself, Prepares for Potential Smartphone-Free Future
August 18, 2014, 7:51 PM
New Photos Show “Assembled” iPhone 6, Protruding Camera Ring
August 20, 2014, 2:32 PM
Lumia 830 Gets Major Upgrades Including New 20.1 Megapixel Toshiba Sensor
August 15, 2014, 6:00 PM
Latest Blog Posts
Space Terrorism is a Looming Threat For the United States
Apr 23, 2014, 7:47 PM
Facebook Aims to Provide Internet to "Every Person in the World" with Drones, Satellites
Apr 1, 2014, 10:20 AM
Retail Mobile Sites Experience Outages in Light of Simplexity's Bankruptcy
Mar 14, 2014, 8:48 AM
Tesla vs. BMW: Who Has the Safer EV?
Feb 1, 2014, 2:56 PM
Justice Leaks Details of Next HTC One Two Flagship Phone
Dec 5, 2013, 4:04 PM
More Blog Posts
Copyright 2014 DailyTech LLC. -
Terms, Conditions & Privacy Information