
Best Buy feels Amazon squeeze, to close 50 big-box stores - Slimy
http://news.cnet.com/8301-1001_3-57406388-92/best-buy-feels-amazon-squeeze-to-close-50-big-box-stores/
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chaosmachine
An interesting comment from Reddit:

"Roughly 5-7 years ago Best Buy was competing with another company called..
Circuit City. One of the ways they were making sure they kept market share was
whenever Circuit City was putting in a bid to open a store somewhere, Best Buy
would bid higher and put a store in that exact same location. This caused Best
Buy to open a lot of stores that were close to other Best Buy's (roughly 3-6
miles in some cases), but they just wanted to make sure Circuit City didn't
get market share.

Fast forward to now, the leases on those stores ending and Best Buy is not
renewing them. The store isn't very profitable as it could be because there is
another one not too far down the road.

What that article also fails to mention is Best Buy is also going to open an
additional 100 stores, two different types (Mobile stores in malls and
community stores in smaller markets). Both of these types of stores are much
smaller, cost less to run but typically are very profitable due to cell phone
sales.

Am I a Best Buy employee? Obviously yes. Do I speak for the company? Nope. Do
I plan on working here the rest of my life? Of course not. Just trying to be a
bit more accurate than the chicken little the sky is falling that is mentioned
in this article is all."

[http://www.reddit.com/r/technology/comments/rj92n/the_slow_d...](http://www.reddit.com/r/technology/comments/rj92n/the_slow_death_of_best_buy_has_begun/c46af5a)

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thehigherlife
I recently tried to buy a cable from their store the other day. They had the
cable on their website for $14 dollars (Amazon had it for $6) and I thought to
myself, "Well that's not terrible, I'd rather have it today, it is worth the
premium." When I got to the store, the best price for the cable, was $30 and
the staff said the $14 cable I wanted was online only (it was not easily
apparent from their site). Even after driving to the store, I decided I can
wait two days and get it for $6 bucks from Amazon.

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jsight
Big Lots is a better place to go to get a HDMI cable (and a few other cables
as well) than Best Buy. I'm not sure which company this says more about,
really.

I find the markup on cables at BB to be very frustrating. Why can I get a
cable shipped all the way across the country for less than 1/8th the price of
a BB cable?

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thereallurch
Best Buy's historical strategy has been to make profits from accessories like
cables. But they have been doing it wrong in the past 5 years. They should be
using these accessories to drive foot traffic.

Best Buy can sell products or services. They obviously cant sell products (for
a profit), and their services kind of suck. But they need to do one or the
other, and they need to do it great. Amazon and company has them beat on
selling products. They need to focus all their energy on selling services.

Best Buy's current strategy is borrowed time. A shame the employees get to
suffer through shitty (mis)management like this.

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lawnchair_larry
Best Buy is not going out of business because Amazon is good. Best Buy is
going out of business because Best Buy sucks. I feel sorry for anyone who
doesn't live near a Fry's.

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IanDrake
So true. I recall when their stores opened. They were clean, the shelves were
stocked with relevant products, and display units functioned.

Now it's just a dirty pile of what's left from last Christmas and display
units that are un-powered or broken.

Don't get me started on their staff.

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gravitronic
Went to a physical big box store (it was a future shop, same difference).

Had to wait 10 minutes for service because one employee was selling the other
employee an ipad.

When I finally got an employee's attention, they didn't have my part (a
USB->SATA adapter), they acted like I was inconveniencing them, and I noticed
for parts they did have they were charging a ridiculous amount. Standard
3-prong power cable for more than $25 ridiculous.

They have some intrinsic advantages to the web store (real salespeople
interaction, physical handling of goods) but with the net experience being so
negative they are not leveraging these advantages well enough to compete with
the speed and ease of online shopping.

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freehunter
This is actually quite sad to me. As much as I complained about Circuit City
and Best Buy with their pushy salesmen and incredibly high prices, there's
always a benefit to being able to go to a store and see what you're about to
buy. You can't tell the build quality of a laptop by reading an Amazon
description. You can't tell the picture quality of a screen by the customer
reviews. You can't do side-by-side comparisons with a product in each hand.

I really like the Sears model. My hometown wasn't big enough to have its own
Sears store, but they had a catalog front-end, where they stocked one unit of
their best selling products so people could see them in person. If you liked
it, they would order one to be shipped to you or to their store, and you could
pick it up. We need tech stores like this, an Amazon front-end.

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buu700
It was a shame when Circuit City went under. However, is there anyone on the
planet not affiliated with Best Buy who wouldn't love to see them go bankrupt?

I'm all rose-coloured glasses and nostalgia when it comes to dying brick-and-
mortar stores, but let's not pretend that Best Buy isn't a silly place.

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freehunter
I'm all for Best Buy and Circuit City going under. I just lament that there is
no good brick and mortar.

~~~
daveyl
I am so torn as well. CC and BB hardly did anything to distance themselves
from online vendors. Their prices suck, services suck, and they don't offer
enough variety and/or higher end items.

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ShabbyDoo
So, Best Buy still exists for some combination of two reasons:

1\. You can get your stuff RIGHT NOW 2\. You supposedly can get customized
help/advice

What can other companies do to hasten Best Buy's death? Amazon seems to be
piecing together a distribution network for same day/next day delivery in
dense urban markets (at least, as a Prime member shipping to Chicago, I was
offered some sort of courier delivery for $4). Perhaps Walgreens, etc. could
up their game and offer an intelligently stocked selection of need-it-now
things like cables? They're open 24/7 in most markets and could probably deal
with "only" a 100% mark-up. Certainly, the immediacy of purchasing a TV from
Best Buy is important to some, but I suspect small accessories account for the
majority of purchases which, if a day's lag time had not been an issue, would
have been made online instead.

The help/advice need seems like a more interesting niche for start-ups.
Hunch.com seems like the right sort of idea if applied to Amazon's offerings.
Let's say my friend suggests that we do a Skype video chat. While I personally
can read through product specifications, know various companies' reputations
for providing driver support over time, etc., my parents would be lost. A good
salesperson asks questions about a customer's needs which help filter down a
huge set of potential products down to just a few. Imagine paying a trusted,
independent, and knowledgeable person $10 for a ten minute chat along with an
interactive Amazon browsing session. People like my parents would be
delighted. Heck, I'd use such a service if I was shopping for, say, a kitchen
faucet.

What else can be done?

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vaksel
of course they are.

With Best Buy, you have to go get in your car, drive 7 miles to the store,
browse for 20 minutes to find what you are looking for, then drive 7 miles
back. So on top of $4 you probably spend on gas, you end up wasting an hour of
your day just to get something.

With Amazon, you get the itch to get something, do a quick search, add it to
the cart, and get it shipped + you can read reviews to find out if the item
sucks.

And of course Amazon will tend to have lower prices...and with Prime, you'll
have it very quick.

The only thing you'd go to Best Buy for, is if you have an emergency, and need
something asap...and there aren't a lot of items that you can't wait a day for
to avoid wasting an hour at the store

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ShabbyDoo
The problem with Best Buy selling cables for absurd mark-up levels is that
they're trading away brand equity for a few dollars today. How does someone
feel if, after buying a cable at Best Buy, he later sees the same cable for
sale elsewhere for 1/4 the price? Will he be so willing to go to Best Buy in
the future? Will he trust the salesperson's recommendations if he does indeed
enter the store again? Traditional accounting methods don't assess the change
in value of a company's brand quarter-over-quarter, but they sure do represent
the seemingly high profit margins of cables. So, what's a poor executive to
do?

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Jun8
Plea HN: When you go to Best Buy don't go out and buy from Amazon! "Is Best
Buy becoming a showroom for online retailers like Amazon?", well, for most
people yes, but what if BB bankrupts, which showroom will you go?

I think their plan sounds good, especially the employer compensation bit. BB's
worst problem is their clueless employees. Whenever I go there, either I can't
find anyone or else I get surprised looks to basic questions. They seemed
bored, etc. I think BB execs should take a stroll to the Apple store and look
at the customer-employee interaction there.

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jcurbo
I often find myself doing the showroom thing with BB and traditional
bookstores - but I typically do not go to the brick and mortar store on
purpose to look at stuff. I am usually out with friends or visiting other
stores (say, at a mall) and happen to go in. So if BB bankrupts, I am not
going to feel particularly affected, because I usually go direct to Amazon
anyway. (Prime helps with that motivation)

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funkah
Interesting - this article blames Amazon, another blamed the iPad squeezing
BB's margins. I say the blame lies with the clueless way these stores have
been run for years. thehigherlife's anecdote about trying to buy a cable is a
good example. Consider the insane irony of the name "Best Buy" in the context
of that story.

