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  • iPad to Blame for Best Buy Store Closures?


    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."
    At the end of the day, Best Buy has to do what Best Buy sees fit to do. And the numbers confirm this reality. The company, after all, reported a loss of $1.7 billion for the quarter ending March 3rd of this year.

    Source: Wall Street Journal
    This article was originally published in forum thread: iPad to Blame for Best Buy Store Closures? started by Michael Essany View original post
    Comments 71 Comments
    1. Painkiller006's Avatar
      Painkiller006 -
      What's next, is the ipad responsible for Blockbuster to close also....
    1. valkraider's Avatar
      valkraider -
      Quote Originally Posted by WilliamGEstill View Post
      so what do u know about best buy staff that gives you the right to insult them with such a name?
      u better than them? its interesting that you can take an actually concerning topic thread and use it as an avenue to get that one little verbal jab in that didn't even need to be there, much less contribute anything worth while.
      makes your feel better about yourself i guess.
      Well, for one I can actually spell the word "you", not to mention form complete sentences and use at least decent grammar.

      I am their target demographic - someone who spends a lot of money on gadgets and media. Yet they are so annoying it makes my skin crawl to listen to them talk. Ask one question and they have to call in the entire store and have a pow-wow to try and figure out the answer - they are completely clueless.

      Isn't this article about how they are losing money? Maybe having terrible salespeople is part of the problem?

      I have never known anyone who had an enjoyable shopping experience at Best Buy in at least the last decade.

      Just go and sit in the computer department and listen to them lie to customers. Or go and watch them hawk their monster cable crap on a kid who just shelled out his life savings to get an XBox. I'll tell you what, take your car in and have them ruin your interior while trying to install a car stereo that doesn't do half what the salesmen think it does.

      Customer Service was their only advantage over internet shopping and they blew that...
    1. RICO_'s Avatar
      RICO_ -
      More than likely I think they just opened up too many stores. Down here in San Antonio, TX there are 9 Best Buy stores.

      Two of them are within 5 miles of each other. Another two are within 7 or 8 miles of each other. And another two are a 10 minute drive from one another. There's to many to close together and they are saturating the market.

      Best Buy's problems are their own fault....not Apple's. Nobody forced them to carry Apple products and if their costs of carrying them are barely lower or outweigh the profit then they should have dropped them a long time ago.
    1. hitman10's Avatar
      hitman10 -
      Quote Originally Posted by Truckerbear View Post
      Because Best Buy has never really been the BEST BUY! I mean anyone with half a brain knows this. I shop at Best Buy and go home and order it online or find it cheaper at another big box store.
      I agree 100%. I bought a new LED 3D tv from best buy yet Walmart had the same with for $100 cheaper and their protection plan was like $150. Best buy was like $250. For the same thing.. I had an awesome best buy guy so i told him id buy it from here if you drop $200 off the price. He said he couldnt change the protection plan cost but he would drop the price of the TV $200 instead of $100 and the 10% difference... which was $20. So i walked out with a tv -$220 cheaper.

      Also i went to buy a wall mount for my new 47" and they wanted like $200 i went to ikea or maybe it was xscargo walked out with one for $30... The same thing.. or am i just crazy?
    1. Illmatic636's Avatar
      Illmatic636 -
      Terrible customer service in the store. It is common for people to go in there and be ignore by employees!! Their sales force is terrible!
    1. bigboyz's Avatar
      bigboyz -
      Its the evolution of the retail market. Having a physical store to walk into is nice, when you want to test a "new something" For Apple buyers like EVERYONE on this site, the new apple products are more or less upgrades for now. Nothing really NEW so to speak. No need to test something that you KNOW is quality and your techy palms MUST HAVE IT..haha! My point is, online purchasing is cheaper and comes with incentives. You go to a store and you get nothing but what you pay for..not to mention you have to deal with "people" something most try to avoid these days. You can't have a bad shopping experience online unless you find you purchased product at a reduced price later on..does't really happen with iOS or OS X..
    1. 14u2nv's Avatar
      14u2nv -
      on the flip side of that, I also hate to go in there and get hounded. I def start getting mad when I pick something up to buy and they try to pressure me into buying three other things. Ask me if I need help; if I do then help me, if not say ok find me if you do. That's the best route.

      As for them losing money, maybe it's because of all the computer game/prog inventory that never gets touched??
    1. Axecaster's Avatar
      Axecaster -
      When you think about it, blaming the iPad is scapegoat for the larger issue: Best Buy used to be a main distributor of entertainment media content: Music CDs, Movie DVDs. They used to have aisles upon aisles of these products a decade+ ago. Now, many people get this content through iTunes or elsewhere. Best Buy still has video game consoles/games because not everyone has/can afford access to downloadable game content. By the next round of consoles, this may make an even larger shift. All Best Buy has left to sell is gift cards for other companies, overpriced accessories, etc.
    1. LSZ33's Avatar
      LSZ33 -
      What I like about the best buy staff, or at least the ones that know their stuff, is that they don't make commission off of sales so you can generally trust their advice. Like most have stated, their downfall is the fact that just about anything you want can be found online or elsewhere, cheaper.
    1. zackymcharvest's Avatar
      zackymcharvest -
      I work for best buy and here's an insider look at whats going on, even tho nobody is going to care.
      When (most) people come into the store, there not always looking for the "best buy" but more the help they can get from our staff. That's why you are not getting the best price, because you are paying for the help that we offer. If you don't need help then go buy it online instead of telling me that you can. I am not going to lie, there are employees that work in our store that would be better used unloading the truck, but we try, so when you guys are bashing us and calling us monkeys, you have to think how would that make you fell if I went into YOUR job and called you and idiot. Its just a job. Best Buy makes a total of 15$ + - 5$ depending on the model. What we try to make the money on is the accessories. And people just want the iPad now and buy that stuff online later. Mobile sales are killing us and the article statement is accurate, I can assure you of that.
    1. Perceptum's Avatar
      Perceptum -
      Quote Originally Posted by zackymcharvest View Post
      I work for best buy and here's an insider look at whats going on, even tho nobody is going to care.
      When (most) people come into the store, there not always looking for the "best buy" but more the help they can get from our staff. That's why you are not getting the best price, because you are paying for the help that we offer. If you don't need help then go buy it online instead of telling me that you can. I am not going to lie, there are employees that work in our store that would be better used unloading the truck, but we try, so when you guys are bashing us and calling us monkeys, you have to think how would that make you fell if I went into YOUR job and called you and idiot. Its just a job. Best Buy makes a total of 15$ + - 5$ depending on the model. What we try to make the money on is the accessories. And people just want the iPad now and buy that stuff online later. Mobile sales are killing us and the article statement is accurate, I can assure you of that.
      Well said.
    1. Jammol's Avatar
      Jammol -
      Who gives a ****?! Hey guess what, if I know that I'm going to be making little to almost NO profit at all by stocking a product...I'm NOT GOING TO STOCK THE ******* PRODUCT!!! Just saying from this small feeble mind of mine! Your prices can be ridiculous at times but if I know I can get it there without having to wait for 2 weeks to get it, I'll buy it from you.
    1. celeron's Avatar
      celeron -
      Take it easy dude
    1. klouud's Avatar
      klouud -
      the only time I shop at best buy is if I need to make a major purchase and want insurance on it: i.e. my iMac and MacBook Air. And I will also shop there is I absolutely need something right now.
    1. luvmytj's Avatar
      luvmytj -
      Best Buy is a good store, but they have been dying a slow death for some time now. The iPad is not the main reason... or even close. One of the biggest things that BB has mentioned as an issue is people use them as a showroom to check out items, then buy them at other online retailers at a lower price. I caught a news story about BB that gives lots of insight to how they operate and how they are suffering.
    1. exNavy's Avatar
      exNavy -
      Worst Buy is more like it. You can blame last Christmas for their problems in some way I'm sure.
    1. RICO_'s Avatar
      RICO_ -
      Quote Originally Posted by zackymcharvest View Post
      Mobile sales are killing us.
      I'm not surprised by this. I don't know what kind of training they do for the Mobile Sales Consultants, but every time they've explained a phone to me they pretty much just read off the description card....something I can do myself. There's just to many phones on multiple networks for the employees to become adequately familiar in a short period of time unless they've been with the company for a good while. Not to mention the dummy phones with nothing but a picture on the screen don't help either. People want to interact and not everyone is gonna buy the Galaxy Note or iPhone or Galaxy S2.
    1. xsteven77x's Avatar
      xsteven77x -
      I work at best buy and without giving away trade secrets, saying they make about ten bucks per unit is not that far off.
    1. Agent929's Avatar
      Agent929 -
      Quote Originally Posted by valkraider View Post
      Well, for one I can actually spell the word "you", not to mention form complete sentences and use at least decent grammar.

      I am their target demographic - someone who spends a lot of money on gadgets and media. Yet they are so annoying it makes my skin crawl to listen to them talk. Ask one question and they have to call in the entire store and have a pow-wow to try and figure out the answer - they are completely clueless.

      Isn't this article about how they are losing money? Maybe having terrible salespeople is part of the problem?

      I have never known anyone who had an enjoyable shopping experience at Best Buy in at least the last decade.

      Just go and sit in the computer department and listen to them lie to customers. Or go and watch them hawk their monster cable crap on a kid who just shelled out his life savings to get an XBox. I'll tell you what, take your car in and have them ruin your interior while trying to install a car stereo that doesn't do half what the salesmen think it does.

      Customer Service was their only advantage over internet shopping and they blew that...
      +999999999999999

      Quote Originally Posted by xsteven77x View Post
      I work at best buy and without giving away trade secrets, saying they make about ten bucks per unit is not that far off.
      I can assure you that you know nothing about what best buy makes off its products.

      Quote Originally Posted by zackymcharvest View Post
      I work for best buy and here's an insider look at whats going on, even tho nobody is going to care.
      When (most) people come into the store, there not always looking for the "best buy" but more the help they can get from our staff. That's why you are not getting the best price, because you are paying for the help that we offer. If you don't need help then go buy it online instead of telling me that you can. I am not going to lie, there are employees that work in our store that would be better used unloading the truck, but we try, so when you guys are bashing us and calling us monkeys, you have to think how would that make you fell if I went into YOUR job and called you and idiot. Its just a job. Best Buy makes a total of 15$ + - 5$ depending on the model. What we try to make the money on is the accessories. And people just want the iPad now and buy that stuff online later. Mobile sales are killing us and the article statement is accurate, I can assure you of that.
      Absolutely no offense to you, but the majority of best buy employees are full of themselves. I dont know you so I can't say anything about you. They are right about what they said about feeding customers lies. I see it all the time. And I can also enure that you know absolutely nothing about best buy profits, and your SM doesn't either.

      Edit: also the part about paying for advice is crap. If any business sells a product, they should be knowledgable of it. Every business.
    1. hogcia's Avatar
      hogcia -
      And they say the economy is recovering, RIGHT!