Electronics retailer Best Buy Co. is laying off 600 staffers in its Geek Squad technical support division and 1,800 other store workers as it seeks to restructure operations and improve results, the company said Friday.
The cuts amount to about 1.4% of the company’s total staff of 167,000.
Best Buy Canada communications manager Danielle Jang told Marketing on Monday that Best Buy has “no plans to make cuts in Canada.”
On both sides of the border, Best Buy is trying to combat the “showrooming” of its stores, as consumers test out products at its stores but go home and buy them cheaper online or at discounters. Interim CEO Mike Mikan has vowed the company is committed to fundamentally changing operations to improve results.
In Canada on Friday, Best Buy and its sister store Future Shop introduced a new price guarantee in addition to in-store kiosks referred to as “BestBuy.ca Experience Areas” that are linked to the web experience.
With the new price promise, the retailers will now beat any competitor’s price—be it online or anywhere else. The offering launched in the stores’ flyers, websites and in-store signage on Friday.
The kiosks, paired with the new price beating offering is “to make sure that people know ‘Look, we’re nobody’s showroom. Quite frankly the websites are our showroom,” Mike Pratt, president and chief operating officer of Best Buy Canada and Future Shop, told Marketing.
He added that the in-store experience also allows for more of a personal approach. Customers can return anything they bought on the web to the stores without having to deal with return fees.
“Over the last two years we’ve spent over $180 million on web infrastructure and on logistics infrastructure,” he said. That includes fulfillment delivery on in-store infrastructure such as the Experience Areas. “The winning retail operating model of the future is combining the web with retail,” said Pratt.
Commenting on the layoffs, Best Buy spokesman Bruce Hight said they are part of the company’s “ongoing turnaround plan.”
In March, the company announced a restructuring aimed at improving results. At the time, the company said it would close 50 of its U.S. big box stores, cut 400 corporate jobs and trim $800 million in costs. Meanwhile, the company, which has about 1,400 U.S. locations, planned to open 100 smaller and more profitable Best Buy Mobile stores throughout the country.
But shortly after that plan was announced, Best Buy’s then-CEO Brain Dunn abruptly left the company and Best Buy said it was investigating his relationship with a female employee. The investigation found he had an inappropriate relationship with the staffer, and it also led to the departure of founder and chairman Richard Schulze, who knew about the relationship and didn’t alert the proper channels.
Since then, Mikan, who is in the running for permanent CEO, has vowed there will be “no sacred cows” as the company reviews its business.
