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

[CG6468]

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

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.  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.

But the numbers only scratch the surface. To discover the real reasons behind the company’s decline, just take this simple test. Walk into one of the company’s retail locations or shop online.  And try, really try, not to lose your temper.

I admit.  I can’t do it.  A few days ago, I visited a Best Buy store in Pinole, CA with a friend.  He’s a devoted consumer electronics and media shopper, and wanted to buy the 3D blu ray of “How to Train Your Dragon,” which Best Buy sells exclusively.  According to the company’s website, it’s backordered but available for pickup at the store we visited.  The item wasn’t there, however, and the sales staff had no information.

But my friend decided to buy some other blu-ray discs.  Or at least he tried to, until we were “assisted” by a young, poorly groomed sales clerk from the TV department, who wandered over to interrogate us.  What kind of TV do you have?  Do you have a cable service, or a satellite service?  Do you have a triple play service plan?

He was clearly—and clumsily–trying to sell some alternative.  (My guess is CinemaNow, Best Buy’s private label on-demand content service.)  My friend politely but firmly told him he was not interested in switching his service from Comcast.  I tried to change the subject by asking if there was a separate bin for 3D blu rays; he didn’t know.

Buh-bye Best Buy?

[NHSparky]

Customer service?  At Broke Guy?

BWAAAAHAHAHAHA!!!!!!!

 

[thundley4]

They pre-load their computers with their spam software, and then want to charge you for something they put on it without you wanting it.  Unwary buyers might get taken by that.  Their prices on similar products are higher than other stores and way higher than online shopping.

[obumazombie]

They didn't learn much from circuit city.

[Gratiot]

They've been running some fairly aggressive promotions as of late.  I've even found their sale prices to be better than I could find online as of recently. 

Unfortunately the large margins just no longer exist (yay?!), which puts them at a huge disadvantage with there high brick and mortar expenses.

[obumazombie]

They've been running some fairly aggressive promotions as of late.  I've even found their sale prices to be better than I could find online as of recently. 

Unfortunately the large margins just no longer exist (yay?!), which puts them at a huge disadvantage with there high brick and mortar expenses.

There are drawbacks to click and order.
Now click and mortar...

[NHSparky]

There are drawbacks to click and order.
Now click and mortar...

Just ask all those BB customers who ordered stuff for Christmas and were told their stuff would be on backorder until mid- to late-January.

[SSG Snuggle Bunny]

They pissed me off beyond all repair a few years ago with their Black Friday bullshit. Stand in line for hours in the cold only te get inside and be told the desired product could only be purchased by those who had obtained a ticket prior to opening...as in obtained their ticket so they were free to leave to shop elsewhere while the rest of us got to stare at the product we wanted to buy sitting in large piles in the middle of the floor in plain view. The time wasted was time that I could have been spent elsewhere. And their website sells out of "limited quantity" Black Friday products at 12:01 a.m.

On the 2 occassions I have re-entered the store in those 5 years I've been pissed off by the lack of selection and higher prices.

They are the Whitney Houston of electronic retailers.

[Rugnuts]

They pre-load their computers with their spam software, and then want to charge you for something they put on it without you wanting it.  Unwary buyers might get taken by that.  Their prices on similar products are higher than other stores and way higher than online shopping.

my father in law blindly bought a laptop computer. i saw the receipt. the laptop base price was $479. he did buy a case $39 and printer $89 (extra ink was $60). other than that, he foolishly got raked with extended warranty, safety software, setup, etc. final price $1200.

i just thought what an idiot.


my last beef with BB: i wanted a new printer, they did not have extra ink the one that i liked most.

[Rebel]

What is this Best Buy thing you're referring to?







 

[Chris_]

I used to work there as a PC tech (pre-Geek Squad).  We were made to go out on the sales floor and "interact" with customers.  Never mind that we were always busy and couldn't spare the extra people.  I sold about a thousand dollars worth of computer equipment to a guy of what I thought was one of the best computers we had available in that price range and got chewed out by the asshole sales manager for not trying to up-sell an extended warranty to the guy.  I found out later that managers get a quarterly bonus based on those extended warranties while the hourly employees do all the work.

[Eupher]

What is this Best Buy thing you're referring to?







 

 

I went into BB in Columbia, MO on Sunday looking for a CD player. (That's right, a freakin' CD PLAYER. Jeezus -- never would I have thought that these things are just about considered ancient technology any more, but hell, I digress....)

Now I had no intention of actually buying a CD player that they might've had (which they did not), though it was advertised on their web site for $20 more than the SAME EXACT CD PLAYER that Amazon.com is selling.

I just wanted to see what kind of bullshit they were going to fling all over me.

As it turned out, the sales guy freely admitted that they didn't have the CD player, that it was on backorder and that they might see it arrive in 2027.

By that time, we'll be listening to our favorite tunes via little chips that they implant into the base of our brain (outpatient surgery, of course). 

Nah. When it's time to buy some of this kinda stuff, Amazon.com does pretty well. With free Super Saver Shipping! 

[Eupher]

I used to work there as a PC tech (pre-Geek Squad).  We were made to go out on the sales floor and "interact" with customers.  Never mind that we were always busy and couldn't spare the extra people.  I sold about a thousand dollars worth of computer equipment to a guy of what I thought was one of the best computers we had available in that price range and got chewed out by the asshole sales manager for not trying to up-sell an extended warranty to the guy.  I found out later that managers get a quarterly bonus based on those extended warranties while the hourly employees do all the work.

That's probably why you ain't there any more.

[obumazombie]

Certainly didn't know that about BB.

[vesta111]

Certainly didn't know that about BB.

I think I posted this  before about the BB in our area.

I went in there to buy a key board for a gift paying cash.    The checker rang up the sale but refused to release the item to me until I signed a statement that I did not want extended coverage on it.  Something new and different here, long yellow page of gobbledygook and at the bottom a request for our Email address.   This was a cash transaction, all this technology was brand new to us, if I wanted to buy the keyboard I had to sign a waver for extended insurance.   

Above my signature there was, ..............................

So we paid cash for the sucker and a week later found a new and useless site had been added to my PC.   Then we found $10.00 a week was taken from our account to go to pay for this strange site.  I did a search on the internet and found 4-5 states were involved with BB for fraud.     Seems the ......... above my name when placed under a microscope was giving BB the right to hack into my bank account and with draw money for a fictitious site.

We tried to flag our account at the bank to not give this site our money but finally I down loaded the impending court cases against them and only then would the bank Flag a do not pay.   

How did this come about, I had an AOL account with bank pay from our accounts, my Email was under AOL, only way they could have found our banking number.

I do not blame the managers or salesmen at BB, they are not responsible for what the Head Office tells them to do, they were as much a victim as the customers were.

Never know when we are to be scammed by someone high up in a business.   

[whiffleball]

I used to work there as a PC tech (pre-Geek Squad).  We were made to go out on the sales floor and "interact" with customers.  Never mind that we were always busy and couldn't spare the extra people.  I sold about a thousand dollars worth of computer equipment to a guy of what I thought was one of the best computers we had available in that price range and got chewed out by the asshole sales manager for not trying to up-sell an extended warranty to the guy.  I found out later that managers get a quarterly bonus based on those extended warranties while the hourly employees do all the work.

I never worked directly for BB, but did some merchandising work that required me to pre-load all their laptops when I changed the POG.

Also, I have to ask you what their shoplifting policy was when you were there?   The few times I serviced BB I was told that employees could not engage a shoplifter in any way.  They were to just watch the criminal, let him walk out of the store, then call police.  One guy got reprimanded for chasing a shoplifter out into the parking lot.  The employee said he just went on auto-pilot when he saw the crime.  The perp dropped his goods while running and got away scot free to try another day, but still the employee got chewed out.

*edited to correct some Nadism

[Chris_]

That sounds about right.  I don't remember exactly what their policy was but they checked reciepts and offered to help load items in cars.  Glorified valets, mostly.

[Evil_Conservative]

Best Buy won't be missed by me if they go out of business.

I cannot remember the last time I walked into that overpriced store.  I can find anything in that store on Amazon or at Target for a lot less money.