A POPULAR retailer has confirmed it’s testing a new style of store this year – in a bold continuation of a company experiment.
The change aims to refine the customer experience and save you time on your shopping trips.
Best Buy‘s CEO Corey Berry revealed the expansion plans, noting the strong financial performance the company achieved in the fourth quarter of 2024.
He took the opportunity to announce the news during an earnings call recently.
Berry said: “We will continue our disciplined annual approach to closing or relocating less profitable locations.
“Last year in The U. S, we closed 12 traditional big box stores and opened two new stores.
“This year, we expect to close roughly five to 10 stores and open a few new smaller format stores.”
Barry added that Best Buy is entering into markets where it has “no prior physical presence and our omnichannel sales penetration is low to measure our ability to capture untapped share.”
This small format is part of Best Buy‘s plan for the new year, per Retail Brew.
The company introduced its “small-format, digital-first store” concept back in 2022 in Charlotte, North Carolina.
This was a 5,000sq ft location aimed at creating a curated selection of products for shoppers.
Best Buy wants to reinstate their physical footprint, and cutting down on space could be a viable way to cut down on costs, too.
The hope seems to be that trimming down on the amount of products in specific locations will help condense and revitalize the shopper experience.
Barry explained: “To be clear, we’re not remodeling every store in the fleet.
“But what we are doing is taking, I would argue, kind of a stronger position than we ever have to ensure that the shopping experience reflects that kind of excitement and that sparkle that technology brings to life.”
Best Buy has recently struck a deal with Bell Canada to rebrand and operate 165 small format consumer electronics stores.
These were previously known as The Source.
Best Buy will provide the products and the supply chain, marketing, and e-commerce expertise.
Bell will offer telecommunications services and operate the stores.
US braces for '45,000 store closures'
Some 45,000 bricks-and-mortar stores could close in the next five years, experts have warned.
Several major retailers have announced store closures or gone out of business altogether in recent years.
In 2023, chains such as Foot Locker announced plans to close up to 400 outlets by 2026.
While, other well-known retailers like Tuesday Morning and Mitchell Gold + Bob Williams filed for bankruptcy in 2023.
Bed Bath & Beyond has closed all of its brick-and-mortar stores and is now an online-only retailer.
The most affected retailers have been clothing, consumer electronics, sporting goods, hobby, book, music, and home furnishing stores since the start of 2019.
UBS has predicted the total number of retail stores will drop by 45k from 958k to 913k.
Despite that, the report says that certain stores should thrive while others decline.
It said retailers such as Walmart, Costco, Home Depot, and Target, could be among the winners.
It is unclear how much this deal swayed Barry to make the small format store expansion, or how much crossover there could be, if any.
The outlet Investing.com reported on Best Buy‘s strong end of 2024 performance.
Their revenue reached $13.9 billion, marking a 0.5% growth in comparable sales.
Comparable sales are the sales generated by a location, not online.
Best Buy also recorded digital sales that accounted for 40% of their overall domestic ones.
This suggests that Best Buy‘s physical footprint is still present, as their in-person stores drew the majority of their sales traffic last year.
Given this, it could make sense that Best Buy is keen to expand it’s physical space to offer more dynamic experiences for customers.
It is not known how many of these smaller stores Best Buy plans to open this year, or when shoppers might expect them.
GettyThe company introduced its “small-format, digital-first store” concept back in 2022 in Charlotte, North Carolina[/caption] GettyIt is not known how many of these smaller stores Best Buy plans to open this year, or when shoppers might expect them[/caption] Read More Details
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