Best Buy is currently underperforming because of several circumstances. It is at a competitive disadvantage with some large firms such as Wal-Mart and Amazon in terms of supply-chain and distribution, which impacts the customer in terms of price-point. Additionally, Best Buy has been undergoing a strategic change of direction that focuses more on small specific stores, and less on the larger, broader operations for which they are currently known. Though this may bode well for the future, there have been financial consequences from this process.
...al-Mart’s methods to keeping these prices down have been immoral. In addition, they have taken advantage of town resources for example, subsidies, employee benefits and exploitation of cheap labor. Even though they have surpassed significantly in attracting customers all over the nation, they failed to do so ethically. This has created losses to competitors, and the battle for profit is an ongoing one. Therefore, I believe that Wal-Mart has become an economical disaster to competitors and the US as a whole. This is due to the exporting of huge amounts of funds to Asian countries, which in turn reduced the funds in the US due to continuous import costs.
Whenever a huge corporation such as Walmart moves into an area with local stores and merchants, all of them are bound to go out of business because all the customers will be attracted to the huge selections and discount. There has been huge protest by these merchants and locals whenever a Walmart is being decided to be implanted there. This hurts their business which can make families go bankrupt and although it can create job opportunities within the Walmart but as you know Walmart has really bad working conditions such as no wages and unfair treatment. Walmart is also to be said to be the most poorly run and understaffed retail store. In previous studies Walmart was shown to be listed as the lowest in customer satisfaction. If you have visited a Walmart previously you might have seen the customers swarming over just 2 or 3 checkout lanes. In recent days Walmart has been better about this by opening more lanes up whenever there are more
When Wal-Mart establishes itself in a town, it makes its competitors to close their businesses since they cannot compete in the current market. There are several businesses that go out of business when this company sets up a branch in the town. However people don’t agree with this since customers are the ones who go to purchase goods from Wal-Mart. If there are people who should be blamed are the customers since they flock into the retail market to buy from them. This is the reason why these retail businesses are out of business. The reason that makes customers go to shop at Wal-Mart is that, there is ample parking, low prices and they also provide superior goods and services to the customers.Down town destruction started earlier before Wal-Mart was established. Wal-Mart is trying to bring with it new technologies that are aimed to cope with the current technologies. We ought to find new ways of doing things and this is exactly what is happening with Wal-Mart. For instance, Wal-Mart might be embracing technology to supplant it. Internet shopping might be some of the new business technologies that they are trying to embrace.
With the passion for the latest and greatest technological knowledge, and the charisma and devotion towards the youth, Best Buy is sure to continue on the high road to success. Best Buy will be changing and advancing to accommodate the ever-changing field of technology. They are truly a testament to upholding and exceeding their vision statement of “meeting the customer at the intersection of technology and life” (FAQ).
When you first examine the organizational structure of Best Buy Co. it can be a bit confusing. Though the company is one big organization, it has many smaller sub organizations, for example Geek Squad and Best Buy Mobile. Though they are one company Geek Squad offers computer repairs as well as computer and home theater installations and trouble shoots, and Best Buy Mobile offers cell phones, while Best Buy as a store sells electronics. The Best Buy Co. organizational structure appears to be a hybrid of a functional and a divisional structure. The store is setup with different departments and each department has a lead or a supervisor that is in charge of meeting sales and financial goals. Above the department supervisors, there is a sales manager and then a general manager that is in charge of everything and everyone in that retail location. That is the part that is more of a functional structure. The divisional structure comes in the separate sub organizations. Best Buy Mobile, though it is in the same retail location most of the time, has its own separate budgets, and sales goals, its own payroll allocation and manager, making Best Buy Mobile a separate entity within the store (Best Buy Co. , 2011).
Second, Best buy would renovate its exist stores in different branch based on the more catalogue of customer who living in(Best Buy, 2015). Therefor, some stores is especially designed for a group of customer like A, some became Customer B stores, C stores. For instance, a delicates service stores with exclusive salesman for IT geek like Customer A. If Customer B, a soccer fans buys a headphone, he or she only want to ease his or her demand to listen music instead of the brand. However, Best Buy not only focus on current profit, but also focus on customer group interaction- to analysis customer purchase behavior (Best Buy, 2015). Accordingly, Best Buy would effectively estimate the next purchase and product combination from customer based on this method. For example, normally, a customer will purchase DVD after she or he buys a DVD player but Best buy’s customer profitability analysis indicated that this kinds of customer also buys music accessories in second day after she or he buy DVD. Thus Best Buy would be able to send more relevant e-mail and special combination offer specific customer after customer purchaser behavior
Pricing and retail strategy is a key component of any business. These strategies play a major role in a customer’s perceptions of a business. Price is almost always a key factor. “Speak to any average consumer and mention the names of some high quality, leading businesses. The chances are high that one of the first words they will use is "expensive". Not "excellent service", "marvelous range" or even "helpful staff" (2006). Wal-Mart uses an everyday low price pricing strategy which has been a massive success for the company.
of product with the rest of the retailers may not be good idea. This kind of business most likely
Samsung and Sony are following Apple’s lead in maintaining control of their prices. For example, stores are restricted from offering sales and discounts on certain products like premium line TVs (Byford, 2012). Premium pricing, which reflects the exclusivity of the product, is a pricing objective used by Samsung. Consumers generally equate price with quality; therefore, if they are getting a top of the line product they are willing to pay higher prices. The combined decision to use premium pricing, and to not allow stores to offer discounts is risky because they can potentially lose sales to other top competitors like LG, Sharp and Panasonic. Another strategic pricing objective used by Samsung is product line pricing, which is advantageous to both company and consumer. Product line pricing offers lower end models of the same product without all of the added features to be sold at significantly lower prices, in this case premium TVs. This allows customers who lack interest in the bells and whistles or otherwise cannot afford the high-end models the ability to still purchase a TV. As a result TV’s offered at a lower price has the potential to sell in higher volumes.
These conditions are brought about by the enormous pressure Wal-Mart has put on their suppliers. Their sheer size enables them to negotiate whatever they want. Suppliers rarely dare to request a price increase, and they are very conservative when giving price quotes to Wal-Mart. To lose Wal-Mart as a customer can mean the end of business for many suppliers. It’s hard to combat this downfall when Wal-Mart has so much buying power-- countries send government officials to Bentonville, Arkansas to lobby for production in their country.
Red – Electronics Retailers (Competitors) - When I think about Electronic Retailers I generally think about; cellphones, laptops, digital cameras, printers, DVD’s, and gaming consoles. But, being the leading carrier of these electronics, I have always used BestBuy personally. Not only because I’ve been doing the research on this project for class but, I’ve always done business with this company when
Best Buy chose them because of their market opportunity, consumer fundamentals, and macro-economic factors (Ferrell & Hartline, 2011). But the cultural from the US to China is very different and can provide many obstacles when organizations try to compete within their structure. Best Buy knew they needed to team up with a company that was well established in order for them to make that move. And although they had already created a dual-brand strategy outside the borders of the US, the move into China would present different situations for the leadership of Best
Realization of this success is hard to grasp in an economy where brick-and-mortar stores have and continue to suffer do to low-cost online retailers such as Amazon and large, low-cost brick-and-mortar retailers such as Costco and Wal-Mart (Bajarin, 2012).
Walmart’s’ vision statement is “Save Money Live better”. They make it work by using their marketing strategy knowing everyone is always looking for the lowest price and it can usually be found at Walmart. Once someone sees an advertisement about the low prices either being in the store itself or on their website they eventually end up becoming a regular customer. Seeing as they can get daily deals all day long? Analyzing all of Walmart’s marketing strategies will narrow down and explain why Walmart is where they are today. (Bacons, 2013).