Best Buy Essay
Best Buy
1. How was competition changing in the consumer electronics retailing industry in 2004? Why was it necessary for Brad Anderson to consider a radical concept change for Best Buy?
With the fast development of Technology, the market for electronics retailing was increasing fast during 1998-2004. And electronics-only retailers like Best Buy and Cirtuit City, experienced a stiffer and broader competition during that period. It was necessary for Brad Anderson to consider a radical concept change for Best Buy, because of the several reasons given as follows: 1. The scope of competitive rivalry is more than among merely electronics-only retailers. There are many threats from different rivals to Best Buy. Some mass discounters such …show more content…
Win entertainment: intend to lead the entertainment category including music, movies, video game hardware and software, and other related products. The company viewed this category as a key traffic driver in stores
3. What has Best Buy’s management done to implement and execute the Concept VII strategy in test stores? What impact has Concept VII had on business processes, policies, practices, and management approaches?
(1) The new retailing approach required transparency in Best Buy and vendor value chains to allow the company to perfect its “anticipatory demand forecasting.” The new forecasting model required Best Buy stores to stock as much as 10% additional inventory and also called on vendors to keep larger inventories if products had long component lead times. Also, Best Buy and vendors were required to exchange real time transactional data.
(2) Concept VII also required a shift of power from the corporate office to the retail stores. Local stores were given control over advertising budgets and product assortment. Previously product assortment decisions were made by the corporate office and modified five times a year. The increased autonomy for store managers and personnel resulted in an improvement in employee satisfaction from a 3.33 on a 5-point scale to a 4.06 in lab
1. How was competition changing in the consumer electronics retailing industry in 2004? Why was it necessary for Brad Anderson to consider a radical concept change for Best Buy?
With the fast development of Technology, the market for electronics retailing was increasing fast during 1998-2004. And electronics-only retailers like Best Buy and Cirtuit City, experienced a stiffer and broader competition during that period. It was necessary for Brad Anderson to consider a radical concept change for Best Buy, because of the several reasons given as follows: 1. The scope of competitive rivalry is more than among merely electronics-only retailers. There are many threats from different rivals to Best Buy. Some mass discounters such …show more content…
Win entertainment: intend to lead the entertainment category including music, movies, video game hardware and software, and other related products. The company viewed this category as a key traffic driver in stores
3. What has Best Buy’s management done to implement and execute the Concept VII strategy in test stores? What impact has Concept VII had on business processes, policies, practices, and management approaches?
(1) The new retailing approach required transparency in Best Buy and vendor value chains to allow the company to perfect its “anticipatory demand forecasting.” The new forecasting model required Best Buy stores to stock as much as 10% additional inventory and also called on vendors to keep larger inventories if products had long component lead times. Also, Best Buy and vendors were required to exchange real time transactional data.
(2) Concept VII also required a shift of power from the corporate office to the retail stores. Local stores were given control over advertising budgets and product assortment. Previously product assortment decisions were made by the corporate office and modified five times a year. The increased autonomy for store managers and personnel resulted in an improvement in employee satisfaction from a 3.33 on a 5-point scale to a 4.06 in lab