Rudeman

Best Buy Bounces on Circuit City Closure

Best Buy is already arrogant. The smug smile will come off their faces as the economy gets better and stock analyst want to know why they can not deliver better numbers with no competition.

At one time Toys R Us put Playworld and others out of business only to get their stock price beaten down because analyst wanted them to capture more of the market. This Best Buy scenario is very similar.

Rumors of Best Buy's Demise Are Greatly Exaggerated

Terrible analysis.

January and October are not the same month so they should not be compared. Hell, why not pick July and October?

Less people shopping typically equates to higher average orders. If only one person shopped all month and he bought a $1000 plasma they would have a great average order for that month. Less people shopping equals less gross sales. That is never good.

Here's my quick take. Analyst will expect Best Buy to gain the marketshare that Circuit City is giving up by closing stores. Sadly many of Circuit City shoppers were/are Wal Mart shoppers. Not being able to grow sales (enough) from the demise of Circuit City will cause analysis to hammer Best Buy stock down.

For reference review what happened to the Toys store industry as Toys R Us killed their competition - Lionel Playworld and Child World.

I do think Best Buy management is smart and in the end they will bounce back -- when the economy does.

Can One Profit From Poor Customer Service?

Ethan, it is apparent you know nothing of retail.

In a brief nutshell: Sales = Payroll = Better Customer Service.
Best Buy is at the top of their game. And their game is to get as big a sale as they can from each customer. Make no mistake, they are a cut throat operation. You paid extra for those folks to be there. They damn well better provide Customer Service.

That aside. Did you not hear about Best Buy 54 million dollar lawsuit?
redtape.msnbc.com/2008...
Is that the Customer Service you want?

Better Customer Service does not equal sales. Check out Wal-MArt or Target. Both are doing great and offer no real Customer Service.