Tuesday, January 3, 2012

Is Best Buy going under?

Interesting column here from Forbes: ["Why Best Buy is Going out of Business...Gradually"].
It is (or was) bound to happen when you consider what is going on in the world, especially with music, books, soon movies, and other types of products that can be downloaded or purchased online. The big chain stores - that gobbled up all the business from the small stores - are going to go the way of the dinosaur at some point. What goes around comes around, as the saying goes.

 There is one problem with his column, I think, and I didn't bother registering to sign up to comment on the Forbes site to leave a comment, and that's the fact that the inventory problem at Best Buy - and other places, if you were looking for specific items and couldn't find them, was based more on a surprise burst of shopping (i.e. confidence) by consumers, and not mismanagement. Retailers didn't have a ton of things on hand because they assumed no one was buying anything. And then, when they started buying stuff, both in stores and online, they quickly ran out.
I found this out the hard way on two different items I was looking for while shopping for my kids. In the end, I had to pay slightly more than the cheapest price for one of the items, since it was the only e-tailer with the item in stock. It was worth it though since the kids haven't stopped playing with the gift. If I had purchased it a bit earlier, I might have saved the money. I actually spent a lot of time trying to find the item in an actual store, so I could look at it, but it was never found.
In the end, the larger point is that the retail sales part of our economy is ever-changing, as it has in the past. It will change even more. Right now, consumers seem to be in the driver's seat a bit, decided what they will and will not spend money on. If big corporations like Best Buy don't make it, not unlike Circuit City, Lechmere, Strawberries, Crazy Eddie, etc., so be it.


Mark de Zabaleta said...

The consumer is king, and the distribution companies must adapt to their requirements.


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