Shopping Discussion

Is Best Buy on the verge of tanking???

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  • Apr 19th, 2012 6:52 pm
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[OP]
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Sep 23, 2005
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Is Best Buy on the verge of tanking???

A bloomberg.com story today reports that Best Buy's credit rating is being downgraded to "junk" status by Standard & Poors. This can't be good.

http://www.bloomberg.com/news/2012-04-0 ... y-s-p.html

I know BB & FS are among the retailers we most love to hate . . . but still, an awful lot of us do shop there. And can you imagine what it would do to market competitiveness for electronics goods in Canada if they were to suddenly go under?
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If BB/FS were to tank the consumer experience in Canada would improve astronomically. I, and most of my family, no longer do any business with BB/FS
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Shamb1es wrote: If BB/FS were to tank the consumer experience in Canada would improve astronomically. I, and most of my family, no longer do any business with BB/FS

How would less competition improve consumer experience? American consumers can afford to stomach one less competition because they have plenty of other options like Amazon.com. What do we have? Amazon.ca? Please.
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Nov 2, 2010
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When it comes to electronics I'd rather see these stores go

-Canadian Tire (in terms of electronics)
-Costco (could use improvements, advertising in-store deals on their site would help, improving the online selection would help too)
-Sears
-The Brick
-The Source
-Walmart (in terms of electronics)

Secondly with FS's reputation they'd be better off selling under the BB name, thus also eliminating the need to price match.
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Jan 7, 2002
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Wingding wrote: And can you imagine what it would do to market competitiveness for electronics goods in Canada if they were to suddenly go under?
The bankruptcy of BB US doesn't necessarily imply the bankruptcy of FS/BB Canada. If FS/BB are profitable or, if not, at least salvageable, then they'd most likely get sold in order to pay the creditors of BB US. The buyer presumably continue to operate FS/BB in Canada.

That said, a credit downgrade to junk status hardly implies the imminent demise of a business. For example, S&P's rating of Robbers was also BBB- until about 5 years ago and yet Robbers didn't go broke. To the contrary they recovered, as did their credit rating.
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cuddlydragon wrote: When it comes to electronics I'd rather see these stores go

-Canadian Tire (in terms of electronics)
-Costco (could use improvements, advertising in-store deals on their site would help, improving the online selection would help too)
-Sears
-The Brick
-The Source
-Walmart (in terms of electronics)

Secondly with FS's reputation they'd be better off selling under the BB name, thus also eliminating the need to price match.



Canadian Tire is a joke for electronics, unless you are looking for CRT TVs, 3 Megapixel and under cameras for $100, and old inkjet printers where the ink is dry pigment dust.

Sears is a do no buy for me. Horrible problems in the past, worse than any Future Shop or Best Buy fiasco. Unless it's an advertised loss leader, I won't shop there.

The Brick is overpriced, has bad selection, and is staffed with vultures. Deals are few and far in between there.

The Source is overpriced, has bad selection, and is staffed with invalids. Clearance prices are the only reason I go in there anymore.


That leaves Costco and Walmart, which get about an equal share of my shrinking electronics purchases. Yup, I spend about ONE TENTH the amount I used to, since I have everything I need, everything is cheaper, and there are no new technologies to entice me to spend any money.



I wonder how gift cards figure into the equation. As a holder of several thousand in Best Buy and Future Shop cards, I assume I am on the bottom of the totem pole in credit risk...
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bylo wrote: The bankruptcy of BB US doesn't necessarily imply the bankruptcy of FS/BB Canada. If FS/BB are profitable or, if not, at least salvageable, then they'd most likely get sold in order to pay the creditors of BB US. The buyer presumably continue to operate FS/BB in Canada.

That said, a credit downgrade to junk status hardly implies the imminent demise of a business. For example, S&P's rating of Robbers was also BBB- until about 5 years ago and yet Robbers didn't go broke. To the contrary they recovered, as did their credit rating.


Yup. That worked out perfectly for Blockbuster Canada. *sarcasm*
[OP]
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blainehamilton wrote: Yup, I spend about ONE TENTH the amount I used to, since I have everything I need, everything is cheaper, and there are no new technologies to entice me to spend any money.
I think many of us have grown weary of the electronics treadmill. It has reached a point where many of the incremental improvements in technology -- at least the ones we can stomach -- truly don't justify the costs of upgrading. I'm also tired of having to constantly learn new systems and interfaces that really don't do a damn thing to improve my life in any measurable way.
...
"I count as braver he who conquers his desires than he who conquers his enemies; for the hardest victory is over the self." - Aristotle
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blainehamilton wrote: Yup. That worked out perfectly for Blockbuster Canada. *sarcasm*
Yup. One example is incontrovertible proof. <sarcasm>

(Since you apparently missed them, I'll repeat, this time with emphasis, the qualifications in my previous post, "The bankruptcy of BB US doesn't necessarily imply the bankruptcy of FS/BB Canada" and "junk status hardly implies the imminent demise...")
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ilove wrote: How would less competition improve consumer experience? American consumers can afford to stomach one less competition because they have plenty of other options like Amazon.com. What do we have? Amazon.ca? Please.

Newegg, Dell, NCIX, a bunch of lesser known online retailers, etc.
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KDSet wrote: Newegg, Dell, NCIX, a bunch of lesser known online retailers, etc.

Sorry, but none of those are legitimate alternatives. All of those places mentioned above are either horribly overpriced or come nowhere near the selections offered by a full blown general electronics retailer.

Despite being putrid crap, BB and FS enjoy an oligopolistic status in Canada. In the States, not so much. There's just so much competition between not only big retailers like BB, Fry's and Amazon.com, but competitive small regional chains.
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ilove wrote: Sorry, but none of those are legitimate alternatives. All of those places mentioned above are either horribly overpriced or come nowhere near the selections offered by a full blown general electronics retailer.

Despite being putrid crap, BB and FS enjoy an oligopolistic status in Canada. In the States, not so much. There's just so much competition between not only big retailers like BB, Fry's and Amazon.com, but competitive small regional chains.

"Horribly overpriced with nowhere near the selection" in my experience applies especially to BB/FS. But then, I suppose that depends on whatever it is you're buying that can't be got elsewhere and/or at a better price. In my case, as with Shambles, I haven't bought nor needed to buy anything from BB/FS since at least 2008, owing to the aforementioned online retailers & other brick-mortar stores.

It's really weird that you say their competitors are what you said above, considering their oligopoly here. Their profits here must be unbelievably exceptional to justify having their sister stores be no more than a 5-minute drive/walk from each other. :eek:

Their collapse in Canada would probably be a boon for the current retailers (incentivizing say Amazon.ca's expansion for instance) as well as new entrants such as Target. I don't see it happening here, but I hope for it. :D
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ilove wrote: How would less competition improve consumer experience? American consumers can afford to stomach one less competition because they have plenty of other options like Amazon.com. What do we have? Amazon.ca? Please.
BB/FS closing in Canada could cause Amazon to decide to get into the electronics game more since there'll be a void to fill. Same could happen with Superstore, Wal-Mart, Costco. London Drugs could even expand out east.
That said, a credit downgrade to junk status hardly implies the imminent demise of a business. For example, S&P's rating of Robbers was also BBB- until about 5 years ago and yet Robbers didn't go broke. To the contrary they recovered, as did their credit rating.
Rogers had a protected market base to fall back on tho. Best Buy actually has to compete in a free market.
Wingding wrote: I think many of us have grown weary of the electronics treadmill. It has reached a point where many of the incremental improvements in technology -- at least the ones we can stomach -- truly don't justify the costs of upgrading.

+1 Most people have a computer, game system, camera, tv, phone or whatever they already wanted. Now it's just replacements when they break and the occasional upgrade. Over the last decade there was a massive growth in tech advancements now it's just the occasional new thing that comes along like a tablet.
Should we have open retail markets to bring more UK and US retailers to Canada?wegmans-tops-trader-joes-americas-favou ... #p27788812
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BB USA and BB Canada are considered separate business entities, if BB USA bankrupts and folds it does not mean BB Canada and FS will do the same.

Blockbuster was a different problem but even when BBV USA closed down it took a few more months for BBV Canada to follow suit but both have been in trouble for many years before they shut down. BB Canada is doing much better than BB USA.

Best Buy UK recently closed all 11 of their stores (in January 2012) after posting massive losses despite them having only opened their first store in the UK in April 2010, less then 2 years prior.
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