Best Buy, originally known as Sound of Music, is a giant retailer of consumer electronics that operates numerous stores in such countries like the USA, Canada, Mexico, Turkey, and China (Hoffman 22-1). The company was founded by Richard Schulz in 1966 and focused on buying audio products. Within a short period of time, video products became the major goods available for the customers of Best Buy. Nowadays, more than 19% of the American market (1100 stores) are the property of Best Buy Co. Inc.
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The peculiar feature of this company is the ability to focus on consumers’ needs and meet their expectations. Its main goal is to provide customers with a necessary portion of help and knowledge about the products available. Best Buy’s customers get an access to the information about a product and the services obligatory in a particular case.
Best Buy hires professional employees, who are able to use their theoretical knowledge about different consumer electronics products, demonstrate a high-quality practice, and be useful for consumers with peculiar needs and demands.
In spite of the fact that the company has faced a considerable amount of challenges in its development, such as economic downturn, globalization, and the promotion of the Internet technologies against brick-and-mortar organizations, Best Buy used its main weapon, the attention to its customers and the identification of the consumers’ needs, and demonstrated the way of survival without lowering prices or quality of services but paying attention to the education of its workers.
The company’s acquisitions like Magnolia Hi-Fi Inc. or Geek Squad (Hoffman 22-2) helped to expand the offerings on the international market in the 2000s, create a high-level completion to such organizations like Amazon, Netflix, and Wal-Mart, and follow its own principles.
Resources of the Best Buy Company
- Skills of individual employees;
- Talented managers with capabilities;
- Constant improvement of knowledge;
- Reputation with customers;
- Brand name;
- Perception of product quality and reliability.
- The company’s ability to generate internal funds;
- The company’s formal planning systems;
- Stock of technology such as trade secrets;
- The development of trustful relations with the suppliers.
Capabilities of the Best Buy Company
Human resources area
- Effective motivation and empowerment of employers;
- Provision employers with knowledge.
- Promotion of brand-name products available to customers in the world;
- Introduction of high-quality services to customers.
- Successful organizational structure;
- Abilities to predict the future of consumer electronics.
- Production of reliable products with guarantees;
- Service quality.
Research & development area
- Attention to digital technologies;
- Development of technological solutions and meeting consumers’ demands.
Core Competencies demonstrated by the Best Buy Company
- Valuable: consumer-centricity;
- Rare: education of the employees to provide and retain related services;
- Costly-to-imitate: considerable acquisitions in the past;
- Non-sustainable: brand name is characterized by high-quality services.
Findings on Fact with Justifications
Finding of fact #1
It is not an easy task to stay in brand regarding the existing competitions between the companies. There are many organizations that are able to compete with Best Buy, and it is necessary for the company to choose a direction and follow it not to lose regular customers and attract more people. The existence of serious competitions is considered to be a potential problem for the company under analysis. So, what steps can be taken by Best Buy to stay one of the leading consumer electronics organizations?
First, not to lose its ratings, Best Buy has to continue thinking about its customers and providing them with the necessary information about products and related services. Second, the company should take care of its workers and make sure they receive the necessary education in order to serve all customers. Finally, the latest technological achievements should be considered. The company should be successful as an online organization and as a brick-to-mortar competitor.
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Finding of fact #2
Among a variety of challenges Best Buy may face with, pricing pressure remains one of the crucial concerns for consideration. The point is that Best Buy does not compete on price. The company is eager to spend much money on employees’ education and acquisitions that can lead to some debts. (Hoffman 22-11). The question is as follows: whether Best Buy should pay more attention to its debt management? In fact, debt management remains to be one of the key factors in any company’s success (Hoffman, 22-11).
The period of economic downturn is the time when Best Buy should be more attention with each acquisition and each investment made. Debt management has to be properly organized considering the demands and expectations of each customer and the abilities of the employees to know when and how to offer the services, explain the peculiarities of the products, and provide customers with a number of guarantees and the quality of both, products and services offered every day.
Hoffman, Alan, N. “Best Buy Co., Inc.: Sustainable Customer Centricity Model?” Strategic Management and Business Policy: Globalization, Innovation and Sustainability. Ed. Thomas Wheelen, David Hunger, Alan Hoffman, and Charles Bamford 14th ed. Manson, OH: Prentice Hall, 2014. 22-1-22-12. Print.