Best Buy to close 50 big-boxes, expand mobile-only format
Minneapolis — In a move to tighten its footprint and reduce costs, Best Buy Co. said Thursday it will close 50 of its signature big-box stores and open 100 of its small mobile locations in the United States in fiscal 2013. The shift will help cut $250 million in costs by 2013 and $800 million by 2015, said the electronics retailer.
The announcement coincided with Best Buy’s Thursday report that it posted a fourth quarter loss of $1.7 billion, compared with a profit of $651 million in the year-ago period. The results included $2.6 billion in charges related mainly to its acquisition of Carphone’s interest in Best Buy Mobile, and adjusted results met Wall Street expectations.
Revenue edged up 3% in the quarter to $16.08 billion, missing the $17.17 billion in revenue that analysts expected. Same-store sales dipped 2.4%.
For the full year, Best Buy swung to a $1.23 billion loss, from a $1.28 billion profit in 2010. Revenue for the year rose 2% to $50.71 billion and same-store sales fell 1.7%.
Best Buy said it will test a new smaller format it is calling Connected Stores in San Antonio, and in St. Paul, Minn. The renovation will reduce square feet in both stores by 20% and will turn the inventory focus to cell phones and other services such as showing customers how to connect electronics throughout the home.
Continued rollout of the mobile-only stores calls for 600 to 800 by 2016, up from 305 currently.
Additional cost-cutting measures include cutting 400 positions.
“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 Thursday statement. “And, over time, we expect some of the savings will fall to the bottom line.”
HuffPo highlights Sam’s CEO, other prominent women
In honor celebration of Women’s History Month, The Huffington Post‘s Nell Merlino has penned a column highlighting some successful businesswomen. Among them is Rosalind Brewer, who in February was named president and CEO of Sam’s Club, and is the first woman, and the first African American to hold a CEO position at one of Walmart’s divisions. Other women on the list include Spanx creator Sara Blakely and financial guru Suze Orman. Read the full article here.
Jackson Hewitt named a Walmart Supplier of the Year
PARSIPPANY, N.J. — Jackson Hewitt Tax Service, the nation’s second largest tax preparation firm, has been named Supplier of the Year by Walmart’s financial services division. Jackson Hewitt was recognized for: its aggressive expansion into over 750 new Walmart locations for the 2012 tax season, which increased its nationwide kiosk coverage in Walmart U.S. stores by 40% to 2,800 locations; embracing innovation by providing new kiosk designs to accommodate specific spacing requirements in all Walmart store formats; and, its commitment to, and support of, Walmart’s focus on Every Day Low Pricing.
"Jackson Hewitt is honored to receive this award from Walmart, and we are proud to achieve this recognition in the first year of a new multi-year agreement between our companies," said Philip Sanford, president and CEO of Jackson Hewitt Tax Service Inc. "Our franchisees and company-owned operations management have worked very hard over the past several years to significantly expand our Walmart kiosk presence, and to continue to provide tax preparation convenience, ease and value for both Walmart’s customers and associates. Receiving this award is a testament to the success of that effort. I thank all of our franchisees and employees for their dedication and commitment to continual enhancement of our Walmart partnership. I also thank Walmart Financial Services for their demonstrated spirit of teamwork and collaboration to make our partnership as successful as it can be."