A massive retailer with 1,050 stores now makes unexpected closures as it struggles with sales, the CEO confirmed.
Best Buy is closing up to 20 stores this year after chief executive officer Corie Barry warned of a declining store count.
The retailer has around 1,050 locations nationwide but is struggling with sales, reports The-Sun.
Best Buy is closing between 15 and 20 stores in 2024, with various stores shuttering March 2nd.
These include the locations in Stafford, Virginia, Apple Valley, Minnesota, and Kansas City, Missouri.
Chief executive office Corie Barry warned last November that such closures were on their way.
“We expect to close roughly 15-20 stores per year in the near term,” she said during an earnings call.
Over the past 5 years, Best Buy has closed approximately 100 stores.
That represents a 10% decline in store count.
Meanwhile, Best Buy is converting some existing stores into discount stores, such as the location in East Northport, New York.
Up to 10 additional outlet stores may also open, according to Barry.
Best Buy is having to make some changes to keep up with new shopping habits.
It’s been a constant in the US retail landscape since the company was founded in 1966.
But it is facing increasing competition from online stores.
To demonstrate the value of physical shopping, some Best Buy stores are being turned into “Experience Stores.”
At these locations, customers will enjoy an “immersive and inspirational” shopping experience as they try out new tech with the help of Best Buy experts.
The retailer has also decided to stop selling DVDs, making room for new products and innovations in stores.
Also Read: Grocery Store With 217 Locations Now Closes For Good
Other Economy News Today
Another mall clothing retailer is now at high risk of bankruptcy as it prepares for debt restructuring, The Wall Street Journal reports.
Apparel retailer Express Inc. is preparing for a possible debt restructuring that could include a bankruptcy filing “within weeks,” The Wall Street Journal reported Monday, citing sources familiar with the matter.
According to the report, Express has hired M3 Partners and law firm Kirkland & Ellis.
Both entities specialize in debt restructuring, reports Retail Dive.
The retailer is looking to avoid a Chapter 11 filing by restructuring its debt outside the bankruptcy process, the report said.
Express reported total debt of about $275 million at the end of the third quarter, an increase from $235.4 million a year before.
During the company’s last earnings call in November, recently appointed CEO Stewart Glendinning acknowledged the company made some missteps: Among other factors, there was a misalignment between its assortment and customer demand.
Express took a hit during the pandemic as its core offering — business casual — fell out of favor as work-from-home surged.
“Unfortunately, my previous assessment of Express’ fragile financial situation leading to a possible bankruptcy due to declining revenue, gross margin profits and ballooning debt of $280 million is a foregone conclusion,” Shawn Grain Carter, a retail industry consultant and professor at the Fashion Institute of Technology at the State University, said in an email to Retail Dive.
“With high-interest rates, the retail company must decide between the ‘lesser of two evils.’
Moreover, until they fix the waning consumer demand for their merchandise and elevate the brand and product mix, financial wizardry will not resolve their retail woes.”
And after the New York Stock Exchange warned of a potential delisting in late March, Express executed a 1-for-20 reverse stock split, which decreased outstanding shares to 3.7 million from 74.9 million.
That stock split enabled Express to regain listing compliance with the New York Stock Exchange.
Around the same time, Express said it planned to cut 150 jobs by the end of the third quarter.
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Also Read: A Popular Essential Retailer Is Now Closing 72 Locations
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