Shopping Discussion

Is Best Buy on the verge of tanking???

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  • Apr 19th, 2012 6:52 pm
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Jun 19, 2001
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Winkle wrote: 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.


????

Its international unit posted revenues of $1.9 billion a decrease of 1.7 percent, as sales were hurt by foreign currency exchange rates and poor sales in Canada and Europe. Results for countries outside Canada are reported on a two-month lag, the company said.

http://www.proactiveinvestors.com/compa ... 23159.html

Shares of Best Buy Co. (NYSE: BBY)Best Buy Co are up as much as 2% in morning trade after the company reported weak December sales. The company cited weaker than expected traffic during the week before Christmas and low demand in Canada and Europe as primary reasons for the lower than expected sales figures.

Read more: http://www.beaconequity.com/smw/18332/B ... z1rAxvuLao
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Mar 12, 2005
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Winkle wrote: 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.

Blockbuster was making money in Canada. They were losing money in the US. They used their Canadian assets as collateral against the debts in the US. They couldn't pay the debts so they had to liquidate their Canadian holdings. Blockbuster Canada wasn't losing money.

So what if BB USA did the same thing if they go downhill? I think its too early to tell. They only close 50 stores which is a very small fraction. It doesn't hurt to weed out the bad ones.

I do agree we don't have much competition in the electronics sector in Canada. We have a few online stores like newegg/ncix but they are more geared towards computer tech. Wal-Mart tries to keep it cheap so their electronics selection isn't very good. Amazon.ca is joke. BB and FS are really the only ones that offer what they do (except maybe smaller companies like Visions). Since they're both the same company it really does give them a strangehold. I am curious to see what Target will offer when the open here. I can't blame them for opening here either. They probably saw how much they could charge Canadians for stuff compared to the US and couldn't resist.
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May 25, 2009
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zoro69 wrote: ????

Its international unit posted revenues of $1.9 billion a decrease of 1.7 percent, as sales were hurt by foreign currency exchange rates and poor sales in Canada and Europe. Results for countries outside Canada are reported on a two-month lag, the company said.

http://www.proactiveinvestors.com/compa ... 23159.html

Shares of Best Buy Co. (NYSE: BBY)Best Buy Co are up as much as 2% in morning trade after the company reported weak December sales. The company cited weaker than expected traffic during the week before Christmas and low demand in Canada and Europe as primary reasons for the lower than expected sales figures.

Read more: http://www.beaconequity.com/smw/18332/B ... z1rAxvuLao
Right, decreased sales and demand in Canada but doesn't really seem to be clear if that's translating to them losing money here though.
zod wrote: Blockbuster was making money in Canada. They were losing money in the US. They used their Canadian assets as collateral against the debts in the US. They couldn't pay the debts so they had to liquidate their Canadian holdings. Blockbuster Canada wasn't losing money.

So what if BB USA did the same thing if they go downhill? I think its too early to tell. They only close 50 stores which is a very small fraction. It doesn't hurt to weed out the bad ones.

I do agree we don't have much competition in the electronics sector in Canada. We have a few online stores like newegg/ncix but they are more geared towards computer tech. Wal-Mart tries to keep it cheap so their electronics selection isn't very good. Amazon.ca is joke. BB and FS are really the only ones that offer what they do (except maybe smaller companies like Visions). Since they're both the same company it really does give them a strangehold. I am curious to see what Target will offer when the open here. I can't blame them for opening here either. They probably saw how much they could charge Canadians for stuff compared to the US and couldn't resist.
Agreed, market situation is vastly different in Canada then elsewhere, online competition is significantly less fierce here. I don't recall Best Buy closing many, if any stores in Canada. I think FS has closed a handful here and there, growth of Futureshop has definitely slowed noticeably, I don't think they've opened many stores recently whereas Best Buy opened a few new ones last year.

Although both BB and FS are expanding and diversifying their product lines, they're selling luggage and other non electronic items online now that they never would have carried so you have to wonder if they're in trouble or simply trying to grow in other segments because they've plateaued in the electronics market.
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Nov 12, 2006
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Winkle wrote: Although both BB and FS are expanding and diversifying their product lines, they're selling luggage and other non electronic items online now that they never would have carried so you have to wonder if they're in trouble or simply trying to grow in other segments because they've plateaued in the electronics market.

Diversifying combined with the new rating is not a good sign.
By having to move out of their core business (electronics and appliances) they are basically advertising that they can't cut it just selling those core items. It reeks of desperation.

Soon BestBuy = The Brick?
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Mar 21, 2002
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It is interesting to see Wal Mart's move into groceries. Profit margins on groceries are very low since there's spoilage problems and lots of labor is required to stock shelves combined with lots of competition for all kinds of other grocery stores. So why did Wal Mart get into this? Easy, it's recession proof. People have to eat. They might not buy other items that Wal Mart sells, but they'll keep buying food and they'll keep coming to Wal Mart and buying other things. The cash flow will keep Wal Mart stores alive even in the deepest recession when people aren't buying anything else.

The problem at Best Buy is that they don't have anything similar. The market is glutted with flat screen TVs - who doesn't have one now? CD/DVD's must have been a very profitable department at one time but people order online now because of lower prices, if they buy at all. Streaming video and piracy have rapidly eaten into disc sales. Cheap cameras? Every cell phone has one now. One by one the profitable departments in Best Buy are under attack and they just don't have anything new - and different from electronics which is somewhat recession proof that they can bring in to soak up floor space the way Wal Mart is doing with groceries. They're being forced to go in a different direction in downsizing floor space and moving in to smaller stores to match the reduced size their electronics business has become. I don't think that they can move quickly enough in this direction to make a difference so their survival will probably depend on the US coming out of recession soon and with strong job growth.
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Nov 15, 2004
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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.

Why Costco? I buy all of my expensive purchases there specifically because of their customer service. They won't hassle you if you find a dead pixel on your TV and want to return or exhange it. All of the other guys will.
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Nov 5, 2001
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Wingding wrote: Best Buy's CEO -- who has been with the company for 28 years -- has just "resigned", and one of the board of directors has taken over on an interim basis. Not a good sign.

http://www.bloomberg.com/news/2012-04-1 ... chief.html



Jeez, I'd no idea BB had been around that long.


Going back to the OP, while Best Buy and Future Shop stores aren't at the risk of being gone tomorrow, (or even in the next year) the company is very close to that point of 'tanking', as in being a money pit that slowly folds in on itself, losing value, and eventually dissapearing.

When I heard the news of Brian Dunn geing ousted, you know there is going to be a bloodbath to try and turn stores around.

Should have happened in 2006. This is like the Titanic turning to avoid an iceberg 6 years too late...
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Aug 22, 2006
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There isn't a Worst Buy in my town, but there is a Future Crap.
I haven't stepped foot into a Future Crap in months, and haven't purchased anything over $FREE in years.
The only thing I did "buy" from them was a SIM card that came up in their system as free. I got a receipt so I guess that counts as a purchase....


Off the top of my head the things that FS/BB sell and where I actually buy them:

-TVs: 4Pack. Warranty and price can't be beat
-TV Accessories: SingularCost since I'm not paying $300 for Monster Cables when SingluarCost sells them for $0.30.
-Cellphones: Anywhere I can since I'm looking for a specific model and frequency band. The last couple phones I bought could have come from FS/BB but they came with Gift Cards and I can't think of anything else I would buy there so I opted for a different retailer.
-Cellphone Accessories: Fleabay. Same idea. Not paying $30 for a cell cover when I can get it for $0.30 shipped. Sometimes Amazon too since they're like Fleabay except ship out of the US.
-Music: I don't really listen to Music, but I normally get it from Amazon MP3 among other sources.
-Movies: Same deal as Music.
-Cameras: The US. I'm not paying a Canada Tax. Also not from FS/BB US either.
-Computers: LOL. FS/BB is the butt of all computer buying jokes. If I needed the "computer expert" to "setup" my new notebook for a *cough* "nominal" fee then sure! Otherwise yeah right....
-Games: Steam.
-Car Audio: Someone that doesn't have a 12 year old doing installs.

I haven't been there in a while so I can't think of anything else they sell.
Deal Addict
Jan 13, 2006
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From what I've read on rfd, the poor customer service and failures to abide by their price guarantee alone should kill them
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Mar 21, 2009
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My Futureshop is my favourite place to shop. I think like always, it's dependent on the people who get hired, and who does the hiring.
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Oct 7, 2007
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I get the occasional good deal from Best Buy so I don't want to see it go just yet. Futureshop not so much in-store but online is okay.

I wouldn't want to see them go. They aren't great but at least they provide good competition. I mean who are you gonna PM with if another store has a price error or gone OOS?
There's a sucker born every minute.
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Nov 2, 2010
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KDSet wrote: Newegg, Dell, NCIX, a bunch of lesser known online retailers, etc.

My problems with these stores:
-At least on the surface they all appear to specialize in computers/computer products
-Until going to the site I would have never known that you could buy other electronics items from Dell
-For some people the cell phones sold at newegg overshadow everything else on the site.
-Even if everyone has heard of NCIX I think many people would get overwhelmed by their vast selection of compuuter accessories

My other problem gets its own category: shopping experience
-Not everyone is tech saavy
-I don't want to always buy online
-when something is out of stock I like being able to phone a store to ask when an item gets restocked (I can't imagine how long it would take to get an e-mailed reply from an online store
-when buying something that was either used or returned unused I have a better understanding of the product's condition in person than had I bought it online
-I have no motivation to return something I've had shipped to me than had I bought from a local store (which is what online stores hope for), at least BB/FS has good options in regards to that
-when I use a credit card to buy something online I save that payment as a last resort: I worry about hackers
I like that I can buy a BB/FS gift card from the local grocery store never needing to tell the online store more personal info than I have to
-Certain products I like to test/compare in person before buying: TV, computer, home theater
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Jun 6, 2009
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At the end of the day, physical retailers are losing customers to their online competitors and hence aren't able to sustain generous return policies, on-the-spot product try-outs, & etc conveniences. Such is life unfortunately for those who prefer them.
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Jan 7, 2002
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KDSet wrote: At the end of the day, physical retailers are losing customers to their online competitors and hence aren't able to sustain generous return policies, on-the-spot product try-outs, & etc conveniences.
Therein lies the conundrum. Physical retailers can only compete against lower-priced online retailers by differentiating themselves with exemplary customer service, including "generous return policies, on-the-spot product try-outs, & etc conveniences." People will pay more at a bricks and mortar store if they feel they're getting something extra for the premium price. Unfortunately, instead of differentiating themselves, B&M retailers are working hard to cut prices and service in a futile effort to compete with online.

P.S. It's ironic, and a sad commentary on the state of retailing, that most of the retailers with the best customer service and return policies operate online, e.g. Amazon, Zappos, ClearlyContacts, etc.
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