Following the 2008 recession, the United State’s economy has been recovering relatively faster than any other country around the world. Due to both effective monetary and fiscal policies imposed by the government, consumer spending has strengthen and has risen to 0.7% due to a rise in personal income by 0.3% in February, according to the Commerce Department. Better consumer spending has positively affected different markets in the economy. For the consumer electronics market, this meant more demands and higher profits. Keeping in mind the competitiveness in the consumer electronics industry, many businesses are facing major challenges by their competitors. For instance, according to an article published in Wall Street Journal, Best Buy has suffered from a slight bump. Being one of the largest retailer stores that offer a wide range of electronics especially TVs, Best Buy reported a decrease in its sales of TVs in December. This is mainly due to the change in consumer demands as technology has been improving. This has not only caused a decrease in sales and profits but also a decline in its stock value, which now costs half its average value.
However, Best Buy has been taking the necessary steps and procedures to keep its reputation and stand in the industry. Now, it will be focusing on providing the stores with more smart phones and has also decided to shut some of its retail TV stores in both Turkey and China. According to analysts, they predict the full recovery of Best Buy as it is marching on the right path.
In my opinion, I think although Best Buy has lost a portion of its sales due to TVs, nonetheless, its ability to identify its problem and take the right measurements to recover is what it matters. The article proves that Best Buy is a competitive business that focuses on maintaining its stand in the industry therefore will be a good choice for investments.
The articles are:
1.http://online.wsj.com/article/BT-CO-20110328-706267.html
2.http://online.wsj.com/article/BT-CO-20110325-710958.html
Yeah I agree that Best Buy has done a really good job. During this recession it would have been really easy to fall apart like similar companies (Circuit City). The demands of this recession have definitely made companies like Best Buy make changes to stay afloat. The changes that you mention make all the right sense and I expect to see Best Buy around for a long time, and will continue to buy their products.
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