On Thursday it was announced that Best Buy will close 50 stores around the U.S. and relinquish some 400 employees as ongoing cost-cutting measures are taking their toll on the big box retailer's expansive market presence.
All told, the electronics retailer needs to trim about $800 million in costs.
So what's to blame for the company's financial burdens? After all, it seems like a lot of people still shop there and almost as many people buy iPhones and iPads from Best Buy as they do directly through Apple. Incredibly, however, the iPad is one of culprits Best Buy is blaming for today's unfortunate cutbacks.
Let's pause for a moment while we all wrap our heads around that statement.
You see, according to Best Buy, the low margins retailers like Best Buy see from iPad sales, regardless of how popular the devices may be, take their toll on the company's bottom line - a bottom line that is also suffering from the compound effects of sluggish PC sales.
"I am not satisfied with the pace or degree of change we have made up to this point," Chief Executive Brian Dunn said in a conference call with analysts, adding, "We are evolving our retail store strategy. We are increasing our points of presence while decreasing our overall square footage."
Source: Wall Street Journal