Why Best Buy is Going out of Business...Gradually

forbes.com ^ | 1/02/2012 | Larry Downes

[Las Vegas Dave]

Electronics retailer Best Buy is headed for the exits. I can’t say when exactly, but my guess is that it’s only a matter of time, maybe a few more years.

Consider a few key metrics. Despite the disappearance of competitors including Circuit City, the company is losing market share. Its last earnings announcement disappointed investors. In 2011, the company’s stock has lost 40% of its value. It’s forward P/E is a mere 6.23 (industry average is 10.20). Its market cap down to less than $9 billion. Its average analyst rating, according to The Street.com, is a B-.

Those are just some of the numbers, and they don’t look good. They bear out a prediction in March from the Wall Street Journal’s Heard on the Street column, which forecast “the worst is yet to come” for Best Buy investors. With the flop of 3D televisions and the expansion of Apple’s own retail locations, there was no killer product on the horizon that would lift it from the doldrums. Though the company accounts for almost a third of all U.S. consumer electronics purchases, analysts noted, the company remains a ripe target for more nimble competitors.

[Truth29]

"I purchased an “as-is” display model stove from them a few years ago. They dropped it off the tailgate onto the concrete while loading it on the truck. The glass top shattered and it had a huge dent in the side. The employees that dropped it had the nerve to laugh and tell me that it’s mine now as they walked back into the store, leaving the stove turned on its side on the ground."

I sure you got justice out of Best Buy either hard or easy.

[Still Thinking]

My Best Buy usually has lot of open parking spaces in front of it, but it managed to reserve a parking spot for “Fuel Efficient” green cars.

I'd park my 12MPG F-150 in the spot just as a way of telling those watermelons to go eff themselves. And it's not even green, it's white. Course I could only do that if I'd lower my standards enough to shop there.

Hmm, I guess if there WERE a good store or restaurant next door I guess I could still park the truck there to flip them the bird without actually having to endure shopping there.

[Minutemen]

Radio Shack died 25 years ago...and nobody thought to bury it.

[Prokopton]

A significant number of people where I live, including myself, will not step foot in our local Best Buy because of the rude, crude, abusive “customer support” and management.

[TribalPrincess2U]

Why Best Buy is Going out of Business?

See all the comments here. They all apply.

[TribalPrincess2U]

One place I wouldn’t miss is Fry’s Electronics. They’re not much different then BB and they will screw you on warranties. I know.

[peggybac]

I don’t mind going to them but NEVER on the weekend.

[Abathar]

"In addition to ease and convenience, the prices offered by online retailers are the, ah, best buy when compared to Best Buy."

Funny that you worded it that way. My son is a big fan of the cable show Burn Notice and wanted season 4 on dvd for Christmas. I shopped on-line and Walmart.com had the series for $29.96, with free shipping to their nearest store for pickup. When I priced it while shopping IN the store they wanted $42 for it on the shelf.

So I could just pick it up and pay full price, or shop ahead and pick it up in the back of the store for a lot less cash and have them route a copy to the store on their truck.

Go figure...

[Dr. Sivana]

The whole article was worth reading, even if the author doesn’t know what “passive voice” means.

[BudgieRamone]

I started in on my TV is the one eyed god rant with the Direct TV Guy.He looked at me as though I was a lunatic (my goal) and then retreated from me in haste.

[Red Dog #1]

"First comes the strategic bankruptcy, well in progress at Best Buy, where management’s sole focus is improving some arbitrary metric from last quarter, even when doing so actually interferes with customers trying to buy something else. The financial collapse comes later. But if history is any guide, the second part, once it starts, will be quick."

Just change a few words and the paragraph would well explain much of the intelligentsia /technocrats marginalization of the Western World.

[Theoria]

I concur. Then again, I’m old fashion and tend to prefer actual physical books instead of ebooks as well as a newspaper I can spill the morning coffee on.

[MarineBrat]

My complaint about Best Buy is that they’re not a technology store. They’re a “magic box” store. I can’t go there to buy electrical components. Not so much as a resistor or capacitor. All they sell are things that sparkle, break, and then for the most part, can’t be fixed.

And then they sell music and videos? What the hell!!! I want to know where I can purchase heat sink grease, or a power supply, not some lousy music and bad movies.

[Paleo Conservative]

I only buy my computers there because I can take it in if needed or return if warranted. I’m afraid to order online - what if something happens?

I never buy computers at Best Buy. I've been buying computers online since 1991. Online retailers tend to have lots of support information and file downloads online. Also they usually have toll free telephone numbers for problems that can't be resolved over the internet (rare for me). If a problem can't be solved over the phone, they can send a technician.

Since I usually buy high end computers, I rarely can find what I need in a store anyway. I prefer to get a computer custom built to my specs which is what online vendors such as Dell do very well. I never like to buy the "Home" version of Windows, but that's what tends to be preloaded on computers in stores like Best Buy. I've found out the hard way that upgrades from the "Home" versions to "Professional" versions void the manufacturer's warranties, and they won't support the upgraded configuration including drivers that come with the computer. I avoid buying HP computers, because they insist on shipping computers without real Windows installation disks just image restores of the factory configuration, and they don't give you disks with backups of the device drivers. I like Dell computers that I order online, because they come with real Windows installation disks and driver disks. They also have drivers available online. Even if you have to reinstall everything from scratch, it's possible to get all the device drivers and bundled software reinstalled. It's even possible to get the drivers for different versions of Windows than originally came with a computer.

[rabidralph]

I am very old-fashioned. Always have been tactile by nature.

[Doc Savage]

You bought a Martin at Best Buy?????????????

[Paleo Conservative]

I bought a computer there, along with extended warranty. When the computer broke, they didn’t know my name. That warranty was a third party vendor, I had to deal directly with them, yada yada yada.

That's another reason I like buying computers from Dell and other reputable online computer vendors. They do their own tech support of the systems they sell. They can provide one point of contact when there are problems with interactions of devices from multiple vendors. I prefer online tech support, because there is a record of the support session afterwards that is available in the future. I can save online chat sessions to a file on my computer for future reference or save emails.

[muawiyah]

Best Buy could be selling more items and at the same time be losing money.

It's not that we "shop" at Best Buy and the use the net to find the best price. We do it the other way around ~ we find the best price then order on-line for store delivery.

This has to hurt the bottom line for all the electronic and recorded media retail vendors.