Transcript: · Best Buy was forced to close 50 stores in the past year. · Being able to compete with online stores, while providing hands-on customer service Current Position Determine profitable products · Utilities Stock Price More successful, prominent and stable electronic business! · Monitor productivity level of new stores · Shut down non-profit stores ·Peak price was at $59.00 per share ·Currently at $15.30 per share Mobile Stores, More Profits · Forbes Magazine 2004 "Company of the Year" · 1,400 retail locations with 170,000 employees 2002 March Extensive training to maintain excellent customer service. (cc) image by nuonsolarteam on Flickr Competitors Big Stores = Big Expenses · Leases expense · Analyze each store's financial position · Convenient locations History Revenue > Costs · Lower expenses = Lower Prices Four Step Process: · Open new mobile stores 2008-2012 · Approximately 40 employees (more during holidays) Results Move products to mobile stores · Mobile stores will be specialized based on buying habits of that geographic area · Insurance · Increase in stock value Profit = Success (cc) image by jantik on Flickr · Products display · Decrease store size = lower overhead costs Transfer knowledgeable staff to mobile stores. (if not close down) Placement Matters Methods of Implementation “Online prices are typically 10% lower than in-store prices”(CNBC, Jan. 2012) Richard Schulze & James Wheeler · Advertisement: Media exposure online and in store · Total costs rise from $38 billion in 2008 to $52.5 billion in 2012 · 1.2 billion loss in last fiscal year ·Downsizing is essential Best Buy's Income Statement
Transcript: Billion-dollar company Where they stand and what they offer In 1990, Best Buy eliminated commissions for standalone sales people, but retained bonuses for management and supervisors. In 1992, Best Buy hit the $1 billion mark in annual revenues. In 1994, Best Buy expanded to the Maryland and Virginia markets. In 1997, Best Buy became the first national retailer to sell DVD hardware and software. Richard. M. Schulze founded Sound of Music in 1966 which later became Best Buy and was the first CEO of it. Many other CEO's have come and gone but the most recent is G. Mike Mikan . In 1966, Richard M. Schulze and business partner Gary Smoliak opened Sound of Music, an audio specialty store, in Saint Paul, Minnesota In 1967, Sound Of Music acquired Kencraft Hi-Fi Company and Bergo Company. Two additional Sound of Music stores were opened near the University of Minnesota and in downtown Minneapolis. The Sound of Music ended its first year with gross sales of $173,000 (USD). On June 14, 1981, a tornado hit the Roseville, Minnesota store. Sound of Music responded with a "Tornado Sale," (with the sale promoted as a "Best Buy") and it became an annual event. In 1983, Sound of Music's board of directors approved a new corporate name: Best Buy Co., Inc What They Offer Best Buy is currently rank 53 in the fortune 500 and they are making a climb to the top. Best Buy offers a lot to the society they have one of the best customer services and they offer just a wide verity of product there if you need anything electronic that is definitely the place to go. The CEO The Best Buy Headquarters is located in Richfield Minnesota. Best Buy has gone international so there are approximately twelve hundred stores in the Best Buy arsenal at this moment. There will be more to come. Business Headquarters Best Buy sells consumer electronics as well as a wide variety of related merchandise such as computers, software, video games, music, DVDs, Blu-ray discs, mobile phones, digital camera, car stereos and video cameras, as well as home appliances (washing machines, dryers, and refrigerators), in a non-commissioned sales environment. Each store also includes installation of car audio and video equipment, on-site installation services, as well as a Geek Squad "precinct" for computer repair and warranty service and accidental service plans. Best Buy By: Miles Davis 21st Century Office The History
Transcript: Multinational Retailer Servicing location in every single retailer with Geek Squad services Consumer Electronics Home Office Products Related Services (Geek Squad) Entertainment Products Appliances Manufacturing & Servicing Locations Incorported in Minnesota Kanwarjai Cheema Ryan Brunswick Nick Lewis Tyler Reeves Shanel Shack BEST BUY
Transcript: Grew out of a small video store called sound of music Opened up a best buy in china... Failed to keep any business in china Fivestar in china averaged 2 million a day and best buy in America only averaged about 2 milion on black Friday BLACK FRIDAY 80 percent is spent in fourth quarter and 40 percent on black Friday Got more customers by opening up at midnight went up 7 percent 2.5 million for first superbowl commercial will match any competitors price Fighting for competition after 45 years of business Over took circuit city in 2009 80 percent is spent in fourth quarter and 40 percent on black Friday Bought geek squad It was imposible for them to have a good year without having a good holiday 6 percent of all money is from geek squad alone
Transcript: Refreezing the organization Objective Survive Prosper Growth Unfreezing the organization Cash flow ROIC + sales and net profit BSC # of new products available % of sales from new products Biocultural audit Level of integration/seperation Artifacts Hoffstedes cultural dimensions customer/employee satisfaction Surveys % of willingness to adapt # of days of external/internal education Control Artefakter Measures Unit cost Rate of inventory turnover Vertical integration Defect rate PPM # of warranty returns Flexible supply chain Customer service Performance Measures 3. Show me what you can Moving the organization Incentive Innovation and learning Measures People Internal process Structure Supply chain optimization Quality Measures 1. What do you believe to be the most relevant organizational and managerial issues to look at - when BB should make it work outside of Canada and USA JIT Delivery < 30 days Satisfaction survey # of returns # of 'geek squad' clients # of days to solve RMA Customer Motivation Culture Financial perspective Objectives Technology Pioneer Organizational allignment Internal/external congruence Objective 2. In regard to your answer in question 1, what theory do you find of most relevance to this case, substantiate with relevant arguments Objectives
Transcript: Best Buy employees would have to work until they found a solution That means staying at work all night and day if the job or situation requires it But now, we found the best way to manage our life time Creative Languages Rufat (cc) photo by Jakob Montrasio Analytical
Transcript: Porter's Five Forces Threat of New Entrants Bargaining Power of Suppliers MAP Bargaining Power of Customers Threats of Substitutes Rivalry Among Competitors Strengths History Founded in 1966 by Richard Schultz Headquartered in Richfield, MN Fortune Ranking 2010 revenues = $45 billion - A gain of $1 billion over 2010 #32 "Most bank for the Buck" #34 in # of employees Statistics Customer Service 24/7 Availability Phone Buy Back Program Geek Squad Competitive Pricing Evnironmentally Friendly International Presence Weaknesses Higher prices for computer services Customer Service Low Margin Products Cultural Adaptability Legal Problems Opportunities Offering more to customers Partnerships Expanding Product Lines Loyalty programs Music Other markets New Locations Going Greener Threats Competitors - Brick & Mortar Changes in Consumer Buying Habits Competitors Online Technology Costs are Decreasing Advances in Streaming Technology Continuing State of Economy Political & Social Upheavals Green Power Purchaser Limited by Capital Geek Squad Cars Wide Selection of Appliances & Electronics Best Buy specializes in TVs, gaming consoles, & computers Local retailers & Shop Local Movements "Future Proof" Technology Recycling Program for Customers Hold 21% of Market Ranked 45 in 2010 Organics Electric Vehicle Chanrging stations Consumer Expenditures Fuel Prices High Standard of work Online Shopping Utilizes Renewable Resources Increased Pressure to Turnover Inventory Best Buy neglected China's national condition following their European & American business models Discretionary Income Increase in Competition, decreasing pricing More cell phone carriers Movies on Demand Increased Shipping Costs Electric Scooters with GE TechForward Lawsuit Increased Comparision Shopping Looking to expand to Asia & Latin America Taylor Variety of Services Online Games/Movies Price Match Guarantee Competitive Advertising Fender Over 155,000 employees B2C Like Niche Markets are popping up in new & different categories Phone service wait times can be as high as 40 minutes Brand Loyalty Increased Use of Technology Virus & Software removal costs from $200-$300 Price Matching Programs Locations in Canada, China, Europe & China Connecticut Attorney General Minimum Advertised Pricing Preloading more software Inflation Improving Loyalty Programs Little bargaining power over pricing Specialty retailers Stand-alone Geek Squad Locations High Unemployment
Transcript: Nobody knows babies like we do! Quality products . Good Customer service. Every Kid really loves this store.. BABYLOU ABOUT US About Us BabyLou was established in 2004. It has been more than a decade since we started, where we have ensured to take care of every need and want of every child and infant under one roof, true to the caption “NO BODY KNOWS BABIES LIKE WE DO”. Our benchmark is to provide 100% customer service and satisfaction and continue to deliver the same with a wide range of toys, garments and Baby Products. Play and Create We Are Best 01 02 03 Block games Building Blocks help Kids to use their brain. PLAY TO LEARN in Crusing Adventures Our Discoveries Enjoy a sunny vacation aboard a luxury yacht with the LEGO® Creator 3in1 31083 Cruising Adventures set. This ship has all the comforts you need, including a well-equipped cabin and a toilet. Sail away to a sunny bay and take the cool water scooter to the beach. Build a sandcastle, enjoy a picnic, go surfing or check out the cute sea creatures before you head back to the yacht for a spot of fishing. Escape into the mountains Disney Little Princes in Also available for your Babies..... Also... Out of The World… Our reponsibility BABYLOU…. Our Responsibility All children have the right to fun, creative and engaging play experiences. Play is essential because when children play, they learn. As a provider of play experiences, we must ensure that our behaviour and actions are responsible towards all children and towards our stakeholders, society and the environment. We are committed to continue earning the trust our stakeholders place in us, and we are always inspired by children to be the best we can be. Innovate for children We aim to inspire children through our unique playful learning experiences and to play an active role in making a global difference on product safety while being dedicated promoters of responsibility towards children.
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