Tag Archives: Best Buy Mobile

Business, Finance, Occupation & Industry

3 Companies Returning to Their Roots

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By Andrew Marder, The Motley Fool

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Sometimes the best things in life are those that we know. Especially in turbulent times, people have a tendency to cling to the things they know best. It shouldn’t be a surprise that companies do the exact same thing, returning to what worked in the past when new ideas flounder. Over the past month, Barnes & Noble , Best Buy , and now J.C. Penney have all turned to leaders from their pasts.

Depending on the company, the “new” blood is either someone who was instrumental in changing the face of things, founded the place, or both. Should investors welcome these prodigal sons back with open arms, or does it mean only heartache in the future?

Barnes & Noble’s CEO moves to buyout
In February, Barnes & Noble announced that founder and chairman Leo Riggio had expressed interest in purchasing the company — but just the retail portion. In effect, the sale would split the retail and Nook divisions, which is a move that has been in the works for more than a year now. Over the course of that year, the Nook has floundered, with holiday sales falling 13% last year.

But the company also got a buy-in from Microsoft and Pearson for the Nook last year, and under the last announced purchase from Pearson, the Nook business is valued at more than Barnes & Noble in its entirety. Investors have been pushing for the division of the two businesses, which seem to be dragging each other down, and since the announcement of Riggio’s intentions, the company’s stock has risen 24%.

Riggio would likely pare down the overall store count, focusing on the businesses that are generating the most revenue. There is also the chance that Barnes & Noble could attempt a smaller-format store, much like Best Buy has done with its Best Buy Mobile locations. Overall, Riggio’s return to ownership seems like a good thing for both customers and investors.

Best Buy in the trenches
Best Buy has also been on the ropes for failing to adapt to a changing business model. Earlier this year, founder Richard Schulze announced that he was raising capital to buy out the company and take it private. After the deadline for his bid came and went, Best Buy announced late last month that Schulze would be rejoining the board, and that he was bringing former CEO Brad Anderson with him.

The move ended up being one of the best outcomes the company could have managed. The founder is back in the mix — with the blessing of investors and board members — and the CEO who helped make Best Buy the titan that it was in the mid-2000s is also around to help out. But Best Buy employees and customers don’t have the headache of confusion that comes from new leaders and the big changes they bring. Instead it’s just a return to stability.

As Best Buy focuses on computers and mobile devices — which had …read more

Source: FULL ARTICLE at DailyFinance

Business, Finance, Occupation & Industry

Best Buy Gets a Lifeline

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By Andrew Marder, The Motley Fool

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For the past few months, Best Buy‘s stock has jumped and fallen based largely on who was thinking about buying the company or who was being hired. Now, the company has some news about something it’s going to actually do: Best Buy is going to capitalize on the strong mobile phone business that it’s built up, and open Samsung stores within its stores.

The mini-store
The concept is going to be set up in both traditional Best Buy stores and in the smaller Best Buy Mobile locations. The program was trialed in Texas, and the success made for a nationwide rollout, which should see the stores in 1,400 locations, with up to 900 open by the end of May.

The stores are going to be staffed by Samsung-trained employees, who will act as the company’s only U.S. retail face. Unlike Apple , Samsung currently does not operate any retail locations, and so has no direct access to U.S. customers. The phone manufacturer is hoping that the new arrangement will allow it to better promote its products, including the iPad rival Galaxy Note tablet.

The Best Buy mobile plan
Best Buy has seen its mobile business expand over the last year, and has said that it will be spending more time focusing on the venture. Last quarter, computing and mobile comparable-store sales grew 13.4%, almost — but not quite — pushing total store comparable sales into the black. On the earnings call, CEO Hubert Joly said that the company would be giving more space over to mobile in 2013, due in part to its strong margins. 

For Samsung’s part, its mobile division has been lagging behind slightly compared to its other product divisions. That growth is going to be difficult without this sort of deal, as Samsung sees the demand for smartphones beginning to slow in 2013. The tie-in with Best Buy should help the company expand its U.S. sales, and give the brand a stronger hold on customers, many of whom may not know the variety of phones and tablets Samsung offers.

The bottom line
This isn’t going to put a major dent in Apple’s income, but it should give a boost to both Best Buy and Samsung. Of the two, Best Buy is in a position to gain more, as sales are slowly righting at the big-box chain. Samsung pulled down $53 billion in revenue last quarter, so it’s doubtful that any increase through Best Buy is going to make a noticeable impact on the company’s earnings.

I’d be looking closely at Best Buy, if I needed more retail in my portfolio. The company is up 14% as of this writing, so the jump on this announcement is behind us, but the horizon looks increasingly good. There’s still a chance Best Buy is really going to turn its business around.

The brick-and-mortar versus e-commerce battle wages on, with Best Buy caught in the middle. Should you invest …read more

Source: FULL ARTICLE at DailyFinance