Best Buy to Close 50 Stores and Lay Off Hundreds of Employees
In recent years, electronics retailer Best Buy has struggled to find its footing — and now the chain has announced it will close 50 stores and lay off scores of employees.
More than 400 executive positions will be eliminated from the chain’s corporate headquarters in Richfield, Minn., and thousands of retail positions will also likely disappear. Best Buy projects the move will save the company $250 million in the next fiscal year, and $800 million over the next three years.
“We intend to invest some of these cost savings into offering new and improved customer experiences and competitive prices — which will help drive revenue,” CEO Brian Dunn said in a statement. “And, over time, we expect some of the savings will fall to the bottom line.”
Caught between high-end retailers like Apple and deep-discount stores including Amazon, Best Buy has had trouble attracting customers who can easily go online and find better deals. In an effort to compete, the store slashed its prices last year — and wound up losing some $1.2 billion.
Forbes reports Best Buy is trying out new store models that will be smaller and aimed at mobile sales, saying, “These new so-called ‘Connected Stores’ will focus on selling cell phones, tablet computers and e-readers, as well as service plans not offered by Amazon and Walmart.”