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(Benzinga)   Wall Street downgrades Best Buy to Mediocre Buy   (benzinga.com) divider line 23
    More: Fail, Best Buy, Wall Street, Wedbush, BBY, margins, downgrade  
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692 clicks; posted to Business » on 22 Aug 2012 at 11:17 AM   |  Favorite    |   share:  Share on Twitter share via Email Share on Facebook   more»



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2012-08-22 09:45:05 AM
I suspect one of the first things that they will do is chop down quite a few stores. Within ~15 miles from my house, there are 4 locations. Crazy.
 
2012-08-22 11:26:26 AM
Endive Wombat: I suspect one of the first things that they will do is chop down quite a few stores. Within ~15 miles from my house, there are 4 locations. Crazy.

Would likely require a Chapter 11 filing to pull that off. Part of the reason investors hate them so much right now are the incredible outstanding liabilities for retail space leasing. (See also: Barnes & Noble)

Then there's the issue of inventory that's worth less every day it sits on the floor. That 52" 3D LED LCD that's been sitting in the back for three weeks? Yeah, they've probably now lost money on it.
 
2012-08-22 11:27:31 AM
For those that don't know, Best buy employees have a quota on credit applications. If they don't get someone to apply in a few shifts (I forget the exact numbers) they get written up, and if they go much longer then that, they are automatically terminated. They are also trained very little on product. Employees are basically taught to push credit applications, extended warranties, and high profit margin items like monster cables. If they have any real product knowledge it's because they had it before they started working at Best Buy, or they learn it on their own time because they actually want to know what they're selling.

Why would I bother going into a Best Buy? On the rare occasion that they actually have a good price on something, they won't have it in stock. And if you actually have a question, like "this is in your ad, do you have it in stock?" the employees don't give two shiats about you if you don't want to fill out a credit application. In fact, the last time I was in a Best Buy, the blue shirt that accosted me went from Mr. fake smiles to a pure jerk when I told him I didn't want to fill out a credit card application, and no, I didn't want the laptop that the geek squad farked with. Of course they didn't have any of the laptops in stock without the geek squad crap on it.

Fark them, I got my laptop from Newegg.

/shamelessly copied from yesterdays Best Buy hate fest
 
2012-08-22 11:36:47 AM
Stories like this make me want to go into Best Buy just to fark with the employees.
 
2012-08-22 11:56:24 AM
BigBooper: For those that don't know, Best buy employees have a quota on credit applications. If they don't get someone to apply in a few shifts (I forget the exact numbers) they get written up, and if they go much longer then that, they are automatically terminated. They are also trained very little on product. Employees are basically taught to push credit applications, extended warranties, and high profit margin items like monster cables. If they have any real product knowledge it's because they had it before they started working at Best Buy, or they learn it on their own time because they actually want to know what they're selling.

You can't be terminated for number of applications, only for not offering. There's a whole huge list of stuff that has to be offered every time, which is horrible for both the customer and the front-line employee. Yeah, if you don't get enough apps, unscrupulous managers can find other things to do to you, like in any business, like cut hours, find other minor violations, but it's not actually legal (to my knowledge) to terminate for number of apps. Not offering is another story, which is why any good employee documents that they offered on their sale sheets.

Then again, what the company DOES like to do is fire their most knowledgeable people for honest mistakes, and then promote the guys who lie to customers but put up good sales numbers. One guy I knew was old-school, worked there for years, knew farking EVERYTHING about stereos, phones, portable audio, gaming, etc., nice guy, they made him carry a 3DS around when they first came out... Guy put it in his pocket while doing something else, forgot and took it home at close, tried to call and let someone know, brought it back the next morning when the store opened... fired instantly. Me, I worked there out of sheer desperation due to bad economy, I know everything worth knowing about consumer PC hardware, got shiatcanned for minor honest mistakes I made on a day I got dumped. They don't care if you're knowledgeable (one salesgirl didn't know that RAM was a physical object that was carried in the store and could be purchased), they don't care if you've worked there for years despite the constant shiatting-on that employees receive from the company, they fire the people that they should be KEEPING to make their customer experience not suck ass.
 
2012-08-22 12:01:22 PM
better get the extended warranty on that stock
 
2012-08-22 12:16:13 PM
Worst buy could do themselves a favor by reducing their margins a bit. You just know that they are getting better wholesale prices from manufactures based on volume, they could easily take advantage of this to make profit on volume sales.

Does a dvd movie really have to cost $20?
 
2012-08-22 12:27:12 PM
DemonEater: BigBooper: For those that don't know, Best buy employees have a quota on credit applications. If they don't get someone to apply in a few shifts (I forget the exact numbers) they get written up, and if they go much longer then that, they are automatically terminated. They are also trained very little on product. Employees are basically taught to push credit applications, extended warranties, and high profit margin items like monster cables. If they have any real product knowledge it's because they had it before they started working at Best Buy, or they learn it on their own time because they actually want to know what they're selling.

You can't be terminated for number of applications, only for not offering. There's a whole huge list of stuff that has to be offered every time, which is horrible for both the customer and the front-line employee. Yeah, if you don't get enough apps, unscrupulous managers can find other things to do to you, like in any business, like cut hours, find other minor violations, but it's not actually legal (to my knowledge) to terminate for number of apps. Not offering is another story, which is why any good employee documents that they offered on their sale sheets.

Then again, what the company DOES like to do is fire their most knowledgeable people for honest mistakes, and then promote the guys who lie to customers but put up good sales numbers. One guy I knew was old-school, worked there for years, knew farking EVERYTHING about stereos, phones, portable audio, gaming, etc., nice guy, they made him carry a 3DS around when they first came out... Guy put it in his pocket while doing something else, forgot and took it home at close, tried to call and let someone know, brought it back the next morning when the store opened... fired instantly. Me, I worked there out of sheer desperation due to bad economy, I know everything worth knowing about consumer PC hardware, got shiatcanned for minor honest mistakes I made on a day I got dumped. Th ...


I was actually an employee back in the early 90s, and back then they didn't even track extended warranties, credit card apps, etc. It was so simple. The idea was to make the customer happy, so they came back and spent more money. I had a great manager who's motto was "whatever it takes". I worked in computers, If we didn't know an answer, we looked it up. More than once we cracked open a desktop to see what brand of hard drive, or what the wattage a power supply was. When it was slow we were given time to do product research. I loved the job, and only left to take a better paying job.

Now as a consumer, I can't stand the place. Upper management has turned the place into joke. The only reason they're still around is that they haven't run out of idiot kids (young adults) to take out credit cards with outrageous interest rates, and old people that actually believe that a sixty dollar HDMI cable will make the picture from the new Blu-ray picture extra clear and sharp. When they run out of idiots to fleece, they will be done.
 
2012-08-22 12:59:36 PM
BigBooper: I was actually an employee back in the early 90s, and back then they didn't even track extended warranties, credit card apps, etc. It was so simple. The idea was to make the customer happy, so they came back and spent more money. I had a great manager who's motto was "whatever it takes". I worked in computers, If we didn't know an answer, we looked it up. More than once we cracked open a desktop to see what brand of hard drive, or what the wattage a power supply was. When it was slow we were given time to do product research. I loved the job, and only left to take a better paying job.

I grew up on Best Buy. In 1983/1984 we went to purchase a new stereosystem and they had one with a new CD player. It had a great price. So we went to buy it - the store manager came out and admitted there was a mistake and the CD player wasn't meant to be part of the price. But he sold it to us anyways at the listed price and then they fixed the price on the unit. Today when you point shiat like that out - they basically throw you out of the store.
 
2012-08-22 01:09:40 PM
Best Buy needs to drop everything and focus solely on home appliances. At the same time, they need to hire competent staff, train them on the product until they are SMEs, and change their mantra to "The best service and the best people for the best customers". Become the go-to destination for great home appliances and stellar, unbeatable customer service and they can make it.

/You're welcome, Best Buy
//Give me stock options
 
2012-08-22 01:13:19 PM
El Uno Magnifico: Best Buy needs to drop everything and focus solely on home appliances.

Best Buy needs to start getting reading for their date with Gordon Brothers.
 
2012-08-22 01:16:56 PM
eCurmudgeon: El Uno Magnifico: Best Buy needs to drop everything and focus solely on home appliances.

Best Buy needs to start getting reading for their date with Gordon Brothers.


Or that too.
 
2012-08-22 01:45:17 PM
hurdboy: Then there's the issue of inventory that's worth less every day it sits on the floor. That 52" 3D LED LCD that's been sitting in the back for three weeks? Yeah, they've probably now lost money on it.

Interestingly enough, the last two major purchases I made at Best Buy were open box items. $800 DSLR camera knocked down to $550 and a new, $1800 15" MacBook Pro knocked down to $1300.

And I did not purchase a single accessory from them.

To say that they lost money on me in my last two transactions is a massive understatement - that is of course if you take into account the already low profit margins on the items themselves, the time that the sales people took in the original transaction, the return time, the Geek Squad's time in checking out the quality of the returns, fact that they had to wipe the computer, reinstall the OS...
 
2012-08-22 01:52:08 PM
El Uno Magnifico: Best Buy needs to drop everything and focus solely on home appliances.

I would argue that they should still offer home theater systems (speakers, receivers, HDTVs), but cut their offerings by 2/3. The biggest BB in my vicinity has at least 80-100 TVs to choose from. It is a bit overwhelming, no...actually it is a lot overwhelming. Also, they need to drop their shiatty "Dynex" and "insignia" home brands. The products are shait.
 
2012-08-22 01:56:13 PM
Endive Wombat: the Geek Squad's time in checking out the quality of the returns, fact that they had to wipe the computer, reinstall the OS...

...search the computer for any good porn...
 
2012-08-22 01:59:55 PM
i think they should go with just tvs, puters and appliances and start renting them also. they could kill some of the regional rent to own places due to bb's size. maybe cell phones and sat dishes like radio shack. anyway, sell or rent to someone offering 0 interest but plenty of hidden traps and farking nail them with fees if they miss a payment.
 
2012-08-22 02:07:40 PM
starlost: i think they should go with just tvs, puters and appliances and start renting them also. they could kill some of the regional rent to own places due to bb's size. maybe cell phones and sat dishes like radio shack. anyway, sell or rent to someone offering 0 interest but plenty of hidden traps and farking nail them with fees if they miss a payment.

That is a losing proposition - aside from having to hire people to be your scummy collectors, you devalue your brand too much by going this direction.
 
2012-08-22 02:27:26 PM
Endive Wombat: El Uno Magnifico: Best Buy needs to drop everything and focus solely on home appliances.

I would argue that they should still offer home theater systems (speakers, receivers, HDTVs), but cut their offerings by 2/3. The biggest BB in my vicinity has at least 80-100 TVs to choose from. It is a bit overwhelming, no...actually it is a lot overwhelming. Also, they need to drop their shiatty "Dynex" and "insignia" home brands. The products are shait.


I'd agree with that. There's still a compelling reason for people to visit stores to see or hear home theater equipment, thus they have the opportunity to make the sale there. Cutting down the inventory might also allow the employees a better opportunity at being able to inform the customer about the product as well.

But I simply don't get why they even bother with CDs/Games. There's so many alternatives for consumers online alone that are all cheaper that deliver the content instantly. I can't imagine their profit in this area is worth the absurd amount of floor space they dedicate to it, not to mention the money tied up in inventory.
 
2012-08-22 04:17:39 PM
Shrugging Atlas: But I simply don't get why they even bother with CDs/Games. There's so many alternatives for consumers online alone that are all cheaper that deliver the content instantly. I can't imagine their profit in this area is worth the absurd amount of floor space they dedicate to it, not to mention the money tied up in inventory.

I pop in there from time to time looking for sales and clearance items. I've picked up a few PS3 games for dirt cheap (I got the last Duke Nukem for $3, which admittedly was about what it's worth). They also had season 1 of Treme for $25 or so, on Blu-Ray. They also have cheap cartoons in the clearance bin, which makes the rugrat happy.

I can see why Amazon is eating their lunch, but I don't have the hate for Best Buy that a lot of people seem to have. That being said, I don't see how their business model is sustainable.
 
2012-08-22 04:50:49 PM
gingerjet: BigBooper: I was actually an employee back in the early 90s, and back then they didn't even track extended warranties, credit card apps, etc. It was so simple. The idea was to make the customer happy, so they came back and spent more money. I had a great manager who's motto was "whatever it takes". I worked in computers, If we didn't know an answer, we looked it up. More than once we cracked open a desktop to see what brand of hard drive, or what the wattage a power supply was. When it was slow we were given time to do product research. I loved the job, and only left to take a better paying job.

I grew up on Best Buy. In 1983/1984 we went to purchase a new stereosystem and they had one with a new CD player. It had a great price. So we went to buy it - the store manager came out and admitted there was a mistake and the CD player wasn't meant to be part of the price. But he sold it to us anyways at the listed price and then they fixed the price on the unit. Today when you point shiat like that out - they basically throw you out of the store.


Are there not consumer protection laws against this in the US? Up here in the great white north, if a product is incorrectly priced other than what is beyond reasonable ($5,000 labelled as $50, for example) you pay that incorrect price. It's actually a voluntary code but Best Buy Canada is a member.

It allowed us to get a really cheap 16GB sd card a while back. At they time, they were normally around $90, but were mis-priced to $45. Bet they got that fixed real quick.

Also, Best Buy Canada will price beat any other Canadian retailer's prices on anything, which is nice. Best Buy has other issues, notably useless staff, but as I usually go in knowing what I want (with a printout from a competitor), I'm pretty happy with them. 90-day same as cash is also handy for smaller purchases.
 
2012-08-22 05:55:39 PM
Nexzus: Are there not consumer protection laws against this in the US? Up here in the great white north, if a product is incorrectly priced other than what is beyond reasonable ($5,000 labelled as $50, for example) you pay that incorrect price. It's actually a voluntary code but Best Buy Canada is a member.

It varies by state but in most cases - Best Buy is under no obligation to sell you the product at the mistaken price.
 
2012-08-22 06:07:45 PM
BigBooper:
Fark them, I got my laptop from Newegg./i>

I've bought 2 laptops from BestBuy in the last year or so. Of course, I found the model/features I wanted via their website and arranged for in store pickup (which also shows you if it's in stock or not). In and out both times in
 
2012-08-23 12:29:19 PM
Got my last laptop at BB, can't complain. But I hardly go there anymore, they don't carry the stuff I'm interested in.
 
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