Best Not Buy

[Jeff Coatney]

Saw this on WSJ. I have grown to hate most brick-and-mortar retail experiences. (love shopping Apple store) So I'm not too broken up about Best Buy selecting itself for extinction. IMO, they are cashing in some bad karma from fleecing their customers with all that extended warranty crap.

http://finance.yahoo.com/banking-budgeting/article/112269/forecast-for-best-buy-worst-yet-to-come

So, why do you hate Best Buy? What do you like/not like about retail? Let's really let 'em have it!

 

[Scott Crawley]

I don't especially like Best Buy, but it has the largest selection of films near me. The obvious benefit of that is that I can go there and in a few minutes satisfy my jones for a new film. The best case scenario with Amazon: pay for express shipping that inflates the cost above the Best Buy price, and then wait one to three days.

My next best option is to Target whose selection is lacking by comparison, or worse yet I can fight The Horde at WalMart to search the mess that is their anemic video section. That's not to mention their horrible staff.

 

[L. Langer]

Saw this on WSJ. I have grown to hate most brick-and-mortar retail experiences. (love shopping Apple store) So I'm not too broken up about Best Buy selecting itself for extinction. IMO, they are cashing in some bad karma from fleecing their customers with all that extended warranty crap.

http://finance.yahoo.com/banking-budgeting/article/112269/forecast-for-best-buy-worst-yet-to-come

So, why do you hate Best Buy? What do you like/not like about retail? Let's really let 'em have it!

I used to work for Best Buy a few years ago. Worst job I ever had. It was easy for the most part but the management was about as corrupt as it gets (they stole from the company and the customers) and the company doesn't care about anything other than the bottom line of a store's profits and they happily broke the laws to ensure that it was taken care of. You'll see many times in recent history where employees have had to go through outside channels by exposing the company's practices to force the corporate management to do what's right instead of just sweeping things under the rug to maintain the status quo. I only shop there as a matter of convenience and because it is the only decent place to buy electronics and Blu-Ray movies around here.

 

[Jeff Kilgroe]

Brick and mortar retail locations like Best Buy will ultimately die off completely. The big issue I have with them is that they fill their stores up with crap most people don't want or need. So much of it is just "filler". So much shelf space dedicated to outdated and obsolete technology. They only offer a small selection of products in any category and offer no incentive what so ever to purchase from them. They have no "knowledgeable" sales staff. Or at least not knowledgeable to a point of being able to give truly helpful answers to most people. These stores tend to sell most core electronic pieces at competitive prices -- TVs, game consoles, audio systems, music players, Blu-Ray, etc.. Many new technology products like new TV models and game consoles often must be purchased with other bundled games and accessories in order to get the good price. But you end up paying extra $$ for the crap you don't want and they couldn't sell otherwise.

They rely on charging exorbitant amounts for necessary accessories, cables, printer ink, media, etc.. They push extended warranty products that are often unnecessary, or often worthless and difficult to claim on down the road. Not to mention these warranties are expensive and extremely limited. I know too many people who were duped into extended warranty coverage on DLP TVs only to find that the display lamps were not covered under warranty and when something did break, the warranty only served to further delay and obfuscate the repair process, often saving little money. Even no money at times once the original cost of the warranty was factored in. With the extended warranty market drying up over the past couple years, the new trend is the technology buy-back program. It works the same way as the extended warranties. People buy into the program with an up-front fee. Then the store will guaranty to buy back their product for a certain percentage of the original purchase price up through a certain date. If you look at the buy-back percentages, they are terrible. The buy-back program works out even better for them than extended warranties do. They know full well that most of those products won't be coming back for the low re-buy prices. Of those that do, not all of them will meet the requirements. The up-front cost for the buy-back program are lower than the extended warranty, but should give Best Buy (and other retailers who are doing it) a higher profit margin compared to extended warranties. Now when a product comes back in for re-buy, they are paying a lower pre-determined price and not paying to replace the item with a full-price new model. They then have a tangible product that can be sold as used to equipment brokers who often take the technology to other markets, often overseas, and re-sell there.
'
Retail store locations still make a lot of sense for many products. The Apple Store is a great model for retail. They are focused on their own products and are run corporately with a very consistent design to store function. They don't try to establish a retail presence in every shopping area around. Unlike Best Buy, Office Depot, Staples, etc.. who seem bent on global domination, setting up a store wherever they can. Even if there's another one less than 10 minutes from this new location.

...Hey Best Buy. A 15ft. Dynex USB3.0 cable is not worth $54.99. That exact same cable is available from Amazon, Newegg and others for $8 with free shipping. And no. I'm not going to pay you $15 extra so you will guaranty to buy back my new $150 point and shoot camera next year for $35. Please hurry up and go out of business... Or change your business model so that people will actually want to shop there.

 

[Meryem Ersoz]

They'll go the way of other brick and mortar stores before them...it will just take a little longer, because the brand is still strong...but the business model is dead in the water and their end product is still in a huge deflationary spiral.

I do find it somewhat sad when businesses fail - behind that name are quite a few people and their jobs...it doesn't really seem like something to root for...I'd rather root for them to take a strong brand and re-invent it, if they can.

 

[Scott Crawley]

...Hey Best Buy. A 15ft. Dynex USB3.0 cable is not worth $54.99. That exact same cable is available from Amazon, Newegg and others for $8 with free shipping. And no. I'm not going to pay you $15 extra so you will guaranty to buy back my new $150 point and shoot camera next year for $35. Please hurry up and go out of business... Or change your business model so that people will actually want to shop there.

yeah... Love that.

+1!!

 

[Mike 'Fireman' Ross]

Depends on the store. If I need to grab something simple, quickly, I'll go there. I'm lucky enough to have B&H on my doorstep and that's always a pleasure... well except for my last visit on Sunday, when the crooks in the overspill parking lot tried to mug me by charging me for my 'free' parking, but to be fair that's not B&H; they were so nasty that I refused to go back into the garage, and B&H went straight round there, dealt with them, and got me my car back.

Mike

 

[Frank Weeks]

...Hey Best Buy. A 15ft. Dynex USB3.0 cable is not worth $54.99. That exact same cable is available from Amazon, Newegg and others for $8 with free shipping.

That always drove me nuts. You nailed their problems precisely. BTW, congrats on reaching 10,000+ posts. You're always a must read.

 

[Michael Hastings]

That always drove me nuts. You nailed their problems precisely. BTW, congrats on reaching 10,000+ posts. You're always a must read.

Didn't quote Jeff's whole post but it's right on. I went into Compusa which got bought by TigerDirect so it's just a retail front for them (here there is an old one right across from Best Buy.

Wanted to get some sort of Raid case. They had at least 50 different USB external drives and drive cases - not a single raid case, and only one or two with esata or firewire, even though they have a pretty good selection of raw oem drives. And why do they have an entire row/both sides devoted to 60 different models/brands of ethernet switches and maybe only 4 or 5 differenet size/capability versions? - just massive redundancy. Maybe manufacturers buy shelf space like they do in supermarkets - but it is a very frustrating model for almost every level of customer.

 

[Nick D]

Saw this on WSJ. I have grown to hate most brick-and-mortar retail experiences. (love shopping Apple store) So I'm not too broken up about Best Buy selecting itself for extinction. IMO, they are cashing in some bad karma from fleecing their customers with all that extended warranty crap.

http://finance.yahoo.com/banking-budgeting/article/112269/forecast-for-best-buy-worst-yet-to-come

So, why do you hate Best Buy? What do you like/not like about retail? Let's really let 'em have it!

Let me ask you one basic question...
Do you cheat your state and local tax system... or do you voluntarily send in the taxes on out of state purchases?

I like retail stores because if it were not for brick-and-mortar stores, many people would not know what to order from internet retailers. They comparison shop locally, then buy online...

It sucks when you can't drive anywhere locally and evaluate Zeiss primes and other pro AV gear, since nobody stocks em... It limits you to reading online articles and going to trade shows a couple of times a year, which some larger manufacturers feel are now unimportant- they just get their gear to THEIR select reviewers and that positive press is all they need...

I think once the playing field is leveled and all online retailers start charging sales tax, many people's opinion might change. Also, once the local stores are driven out of business, the online retailers will raise their prices and MAP enforcement will become prevalent for authorized retailers.

I think the same will play out with movie and music downloads... give 'em enough time and downloads wil go from a buck to $1.50 to $2...

 

[Gavin Greenwalt]

I live in one of the many states which most online stores charge sales tax. It's still far more convenient for me to use Amazon prime to buy... anything, than to drive to Target. Free 2nd or Next Day. Unless I need it right at that very moment I'm just going to buy it on Amazon. Even with Sales Tax.

 

[Michael Olsen]

I think Jeff has, once again, hit many nails on their respective heads.

Their business model doesn't work anymore. It may have worked in the 1990s when computers were new and no-one but the IT crowd knew what was going on. People needed someone with just a modicum of knowledge to point them in the right direction and to get them a printer that would work. And one of those newfangled DVD players.

Now, people know about computers. Not all people, but most people. And the people that don't know about computers generally have close family that can help them out. Not to mention the fact that the retail experience is often significantly faster and less expensive when done online.

This doesn't mean that brick and mortar stores should die, necessarily. They just need to be done in a way that makes sense. And frankly, I think Apple stores are a great example. I can know that I need some kind of product - a computer, for example. I can walk in the store, and tell someone who actually knows what about what they are selling what I'm looking for. They can then give meaningful advice and allow me to try different products right then and there. Not only do I get to see the products (in a good environment - ever go TV shopping at Best Buy?), but I get a salesperson who can actually help me, a straightforward pricing plan, etc. I wish more stores would do something similar to make coming there worthwile. Right now, all they offer is immediacy.

 

[Michael Hastings]

Let me ask you one basic question...
Do you cheat your state and local tax system... or do you voluntarily send in the taxes on out of state purchases?

I like retail stores because if it were not for brick-and-mortar stores, many people would not know what to order from internet retailers. They comparison shop locally, then buy online...

It sucks when you can't drive anywhere locally and evaluate Zeiss primes and other pro AV gear, since nobody stocks em... It limits you to reading online articles and going to trade shows a couple of times a year, which some larger manufacturers feel are now unimportant- they just get their gear to THEIR select reviewers and that positive press is all they need...

I think once the playing field is leveled and all online retailers start charging sales tax, many people's opinion might change. Also, once the local stores are driven out of business, the online retailers will raise their prices and MAP enforcement will become prevalent for authorized retailers.

I think the same will play out with movie and music downloads... give 'em enough time and downloads wil go from a buck to $1.50 to $2...

Fortunately in our state producers can get a sales tax exemption for equipment and expendables - so we aren't violating the law.

But the 6% or so sales tax probably isn't the primary reason for going online. Selection, convenience, and pricing are probably the keys.

Amazon Prime is pretty great - a flat $79 a year gets you free two day shipping and if you need it tomorrow just an extra $3.99.

And now it includes their free on-demand video service. Not the greatest selection but still worthwhile.

 

[Jeff Kilgroe]

Most of the big online vendors charge tax in most states. The exceptions are when a vendor has no physical business presence in a certain state and that state does not mandate that out of state sellers charge tax. Here in CO, Amazon is about the only major online seller that we can buy from without paying tax, but can still be taxed if Amazon Marketplace sellers are within CO.

Amazon prime is one of the best membership type fees I pay for all year. The online video service is nice, but I already have Netflix, so I don't use it.

Avoiding sales tax is hardly why I buy on Amazon or go online. To be completely honest, I would prefer just stopping at the local store and buying what I want. The problem is that most retailers, like Best Buy, rarely have what I want. Or if they do, they don't have other products I would like to compare to. They offer no incentive to buy from them. I'm not going to pay their extortionist prices for flash memory, cables and other accessories. I don't want them to up-sell me a warranty plan or a buy back plan. If I'm buying a new P&S camera for the wife, and for me to use occasionally as well, I would love to walk into BB and see a nice selection of CURRENT product offerings. I can't do that. They don't have them. Their selection is TERRIBLE, their products are out of date, some as much as 3 years old. I use the camera as an example because I did just buy one. And while I knew BB and the local stores wouldn't have the Olympus XZ-1 that was just released, I hoped they would at least have the others I wanted to compare. It didn't happen... I had to order online either way. Even after visiting 3 stores and wasting half a day of my time, spending far more money in time and gas to drive around than if I could've just walked into BB and bought what I want.

The business model is old and inefficient. If they don't change their ways, they will die. Plain and simple. Like Meryem said above, there are people and their jobs that would be affected. I guess that's an inconvenient truth. I don't want to wish people out of their jobs, but I also can't see a good reason (other than those people and their jobs) to hope that all these big-box retail stores, with their lumbering product selection, and antiquated profit models to continue doing what they're doing.

 

[Gavin Greenwalt]

The business model is old and inefficient. If they don't change their ways, they will die. Plain and simple. Like Meryem said above, there are people and their jobs that would be affected. I guess that's an inconvenient truth. I don't want to wish people out of their jobs, but I also can't see a good reason (other than those people and their jobs) to hope that all these big-box retail stores, with their lumbering product selection, and antiquated profit models to continue doing what they're doing.

This is the real problem. Our economy is going to continue shedding these kinds of jobs across the board. It's going to get progressively harder and harder to find a job which isn't replaced by a more efficient factory -> door system or automated kiosk.

Our entire economy is old and inefficient. And the efficiencies are going to be gained at the expense of employment. I can't think of a single job which I had applied for in high-school which now couldn't easily be replaced through automation except in special fringe cases.

 

[Jeff Coatney]

I can see a future retail space that is a "destination: browse" type of public social space. Manufacturers pay to exhibit and consumers gets some trigger time with the merch. Kinda like a permanent trade show. But these would be few and far between. Not like the location saturation that we see now.

 

[Rob Ruffo]

I live in one of the many states which most online stores charge sales tax. It's still far more convenient for me to use Amazon prime to buy... anything, than to drive to Target. Free 2nd or Next Day. Unless I need it right at that very moment I'm just going to buy it on Amazon. Even with Sales Tax.

I live in a pedestrian scaled city, downtown. I think the problem with brick and mortar is partly a sprawl problem. I am happy to walk a few blocks to the photo store, or a few blocks to Future Shop. Many small indy stores survive here simply by being somewhere people like to walk. If I lived in suburban sprawl that pleasant bit of exercise and possibly social interaction would become an awful drive through a strip mall crudscape.

It is not healthy for people to be stuck in their houses with no public places, and stores are among public spaces.

 

[dino g]

LA TRONICS...NEED I SAY MORE.

 

[Michael Olsen]

I realized on the way to dinner yesterday that there is a massive Best Buy opening around the corner from me. Fortunately, it's going up in an existing structure, but...it makes me wonder.

 

[Aaron McAdam]

The only Brick and Mortar place I frequent is the "Buy More" (NBC's "Chuck")

But, seriously, like the rest of the posters...my purchases are made online, because of selection.