The retail experience in stores has been in decline for a long time.
9,300 brick and mortar stores closed in 2019, with 12,000 stores closed in 2020.
While Amazon (AMZN) - Get Amazon.com, Inc. Reportand other e-commerce stores, which may offer lower rates because they don''t have to pay for real estate, have significantly reduced the margins of department stores and big box retailers, some have found ways to reinvent and remain afloat.
Best Buy (BBY) - Get Best Buy Co., Inc. Report is on the verge of irrelevance, or dying a slow death, according to the Inc., with corporate scandals, low morale, and increasing competition threatening to put the company out of business.
Despite a shift in corporate strategy, the company was able to recover. Hubert Joly, the new CEO, has started refocusing on employee training in order to increase morale and improve customer service.
Joly noted that Best Buy was becoming a destination where people would travel, test out a service only to buy it for a lower price on Amazon. So Best Buy established a price matching system so people would buy then and there, which resulted in a decrease in sales.
The company has also begun charging companies like Apple to sell their products in a commercial space, which has also increased profitability.
These measures and increased the capacity of the business to avoid the so-called retail apocalypse. It has now decided to expand its physical footprint.
What Does Best Buy Have Planned?
Best Buy has announced plans to open four new outlets that will offer clearance and open-box (i.e., items that have been returned but are still in working order) at reduced rates.
The store intends to offer discounted laptops, tablets, gaming services, and mobile phones from known brands, and the Geek Squad will be on hand to assist customers.
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The stores will open in Chicago, Phoenix, and Manassas, Virginia, and they will be remodels of existing Best Buys, while a Houston location will relocate to a three-quarter larger location.
The company currently has 16 outlet stores, and intends to double that as a result.
The Outlet Stores are designed to make shopping easier.
Best Buy has developed a program in order to assist Amazon customers with navigating their online shopping schedule. It allows users to select a particular item on their website and then pick it up that day at a physical location.
Customers will be able to see what products are available at their local outlet store, and at what price, at BestBuy.com/Outlet. They may then select the discounted item from the store or curbside.
Customers may also be able to send small items such as laptops or tablets directly to them. You may also receive same-day delivery via third-party delivery partners such as Dolly and Bungii.
If your item is quicker to pick up, you may also send a Best Buys website to an outlet store.
What Are Experts Saying About Best Buys Move?
On behalf of Best Buy, experts on Retail Wire believe it''s a smart strategy.
"Exlet stores in consumer electronics make nothing but sense," says Carol Spieckerman, president of Spieckerman Retail. "Best Buys promises to provide high standard of service and same-day delivery for its outlet stores. "It''s possible that best Buy stores will be able to offload last-generation gadgets that would otherwise languish in their mainline stores (or landfills)."
"The Best Buy outlet model is a clever way to transform underperforming shops and minimize the space for discontinued, discounted, and opened box items," says David Naumann, the marketing strategy coordinator for Retail, Travel, and Verizon. "The challenge will be merchandising goods that have a quantity of one, and keeping the shelves full and tidy."
"For Best Buy, this is a good way to move merchandise that didn''t sell in their main stores, according to Shepard Presentations, LLC. "They go out of date as upgrades improve the technology. (By they way, it''s the same for fashion." "The outlet store, where Best Buy can promote a "last year model," makes good sense."