News

Buyout drama extended at Best Buy

BY CSA STAFF

February 2013 promises to be an interesting month at Best Buy following the retailer’s decision to extend the timeframe for company founder and former chairman Richard Schulze to submit a potential buyout offer.

Schulze will have the entire month of February to present an offer and then the board will review the offer within 30 days to determine if it is in the best interests of shareholders.

"Both parties believe that allowing Mr. Schulze to bring his offer after the holiday season and fiscal year end is in the best interests of shareholders and provides Mr. Schulze and his potential partners with an opportunity to include the company`s full year results as part of their due diligence review," according to a Best Buy statement.

It is unclear why the parties didn’t think of that back in August when they agreed to a timeframe in which Schulze would have access to non-public information that would allow for the formation of an investment group and a possible offer. Terms of the initial agreement gave Schulze 60 days after the beginning of a due diligence period to present an offer and also indicated that if Schulze submitted a proposal that was rejected by the board he would have an opportunity to submit a second proposal in January 2013.

The company also pointed out that the existence of an agreement with Schulze doesn’t guarantee that he will submit an offer or that such an offer would be accepted.

The extension granted to Schulze is the latest development in an ongoing saga that began to unfold in recent years as the company lost sales momentum and profits deteriorated. The situation escalated in April of this year when former CEO Brian Dunn was fired after only a few years on the job when an investigation concluded he violated company policy by engaging in an extremely close personal relationship with a female employee that negatively impacted the work environment and demonstrated extremely poor judgment and a lack of professionalism.

The company noted at the time that there were no disagreements with Dunn on matters relating to operations, financial controls, policies or procedures. Dunn had been named CEO in 2009 to replace long-time Best Buy executive Brad Anderson. Dunn had spent the prior three years as president and COO and was a Best Buy lifer who joined the company in 1985 as a store associate when the company had just 12 locations and had risen steadily through the operational side of the business.

Dunn’s transgressions also cost Schulze the role of chairman at the company he founded in 1966. The investigation concluded that Schulze acted inappropriately because he failed to bring the matter to the attention of the board’s audit committee in December 2011 when he first became aware of the allegations. The audit committee didn’t learn of the matter until mid-March of 2012. Schulze was given the honorary title of chairman emeritus and the opportunity to serve on the board until June 2013 while fellow board member and audit committee member Hatim Tyabji was elevated to the role of chairman.

In the meantime, board member Mike Mikan was tapped as a temporary replacement for Dunn until new CEO Hubert Joly was hired three months ago. After just two months on the job, Joly unveiled a "renew blue," strategy at an investor conference in New York.

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News

Tostitos welcomes troops home with football fiesta

BY CSA STAFF

PLANO, Texas — Tostitos surprised 28 U.S. military veterans who have previously served overseas with a special homecoming celebration.

The unsuspecting service men and women arrived at Cerritos College just south of Los Angeles to play a casual game of flag football, benefitting Got Your 6 and the Pat Tillman Foundation, and divided into Team Freedom and Team Liberty. Upon their arrival, they found more than 12,000 fans waiting for them. While the veterans suited up for the game, legendary college football coaches Bobby Bowden and Urban Meyer announced they would each coach one team. Playing alongside the veterans were Marcus Allen and Kurt Warner. Actor Owen Wilson was also on hand, playing with Team Freedom. Eric Stonestreet reported from the sidelines and Gym Class Heroes was the musical guest.

"The Tostitos brand is all about making anytime party time, and we couldn’t think of a better reason to throw a party than to thank the men and women in uniform for their service and sacrifice overseas," said Tony Matta, VP, marketing, Frito-Lay.

The surprise Tostitos Homecoming Party Bowl was made possible through a partnership with Got Your 6 and the Pat Tillman Foundation. Got Your 6 is a campaign led by the entertainment industry that encourages the nation to view veterans and military families as leaders and civic assets. Founded in 2004, the Pat Tillman Foundation provides resources and educational scholarship support to veterans, active service members and their spouses.

Highlights from the surprise party were captured on film and will be televised nationally during the Tostitos Fiesta Bowl broadcast on ESPN January 3, 2013. The highlights will also be available on the Tostitos Facebook page following the Tostitos Fiesta Bowl broadcast.

Team Freedom won the game, 26-20.

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OPERATIONS

Study: Walmart and Best Buy lead for retail stores used for ‘showrooming’

BY Marianne Wilson

Toronto — As consumers continue to seek more convenient methods of shopping, through mobile and online, the potential for further sales erosion continues to threaten retailers, according to a new study by branding and design firm Shikatani Lacroix.

The report, “RE:STORE – Redefining Retail,” finds that 59% of U.S. shoppers “showroom” – or browse for products in store but then buy them online.

Walmart and Best Buy lead for retail stores used for “showrooming,” whereas Amazon.com dominates in online purchases. One-quarter of U.S. consumers who shop online rarely or never buy from a traditional retailer’s website – 45% of them are shopping at Amazon.com. This amounts to a potential retail sales leakage of about 15% (to as high as 42%) of all U.S. browsers going to an online retailer.

“This behavior spells trouble for a number of traditional retailers who will experience significant sales leakage if they don’t stem the flow of lost potential revenue to online retailers,” said Jean-Pierre Lacroix, president of Shikatani Lacroix.

Conducted by Hotspex, a research leader in emotional and behavioral science, the study also examines the emotional attributes consumers experience while shopping online versus shopping in store, and based on those emotions determines a relationship index of retailers – from highest emotional connection to most vulnerable to sales erosion.

At the top of the list is Amazon, which has the highest overall relationship index of all retailers. The brand elicits strong emotional response in the areas of trust and success, and has very strong satisfaction ratings. Walmart, on the other hand, has a much lower emotional valence. While its online relationship score is high in the mass merchandise category, its in-store experience significantly lags. Walmart’s retail personality is considered boring.

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A.Roy says:
May-31-2013 06:59 am

showrooming
I really love showrooming. Thank's for providing such a informative information. Online MBA

A.Roy says:
May-31-2013 06:59 am

I really love showrooming. Thank's for providing such a informative information. Online MBA

C.Swan says:
Apr-18-2013 05:46 pm

Online shopping
Online shopping is of great help. Has made things really easy for shopper :) http://www.venkotech.com/

C.Swan says:
Apr-18-2013 05:46 pm

Online shopping is of great help. Has made things really easy for shopper :) http://www.venkotech.com/

A.Jain says:
Apr-18-2013 12:09 pm

good job
it imparts great knowledge http://www.ifeel.edu.in

A.Jain says:
Apr-18-2013 12:09 pm

it imparts great knowledge http://www.ifeel.edu.in

P.Rogers says:
Mar-20-2013 05:38 am

I guess the big difference
I guess the big difference here is the kind of services offered.People prefer to shop online for convenience. Some online offers better services than in stores. - Michael Courouleau

P.Rogers says:
Mar-20-2013 05:38 am

I guess the big difference here is the kind of services offered.People prefer to shop online for convenience. Some online offers better services than in stores. - Michael Courouleau

M.Mirevski says:
Mar-08-2013 11:14 am

Here are the reasons why an
Here are the reasons why an electric toothbrush is better than the manual one: A manual toothbrush only cleans the food and germs from the surface of the teeth but a pulse toothbrush reaches much deeper. Make sure that the brush head is right for you. here Make sure that replacement brush heads are easily available. It has not been conclusively proven that electric toothbrushes are better than manual ones, and using either brush can clean just as well provided that the brush is used properly and as prescribed.

M.Mirevski says:
Mar-08-2013 11:14 am

Here are the reasons why an electric toothbrush is better than the manual one: A manual toothbrush only cleans the food and germs from the surface of the teeth but a pulse toothbrush reaches much deeper. Make sure that the brush head is right for you. here Make sure that replacement brush heads are easily available. It has not been conclusively proven that electric toothbrushes are better than manual ones, and using either brush can clean just as well provided that the brush is used properly and as prescribed.

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