Best Buy Swot Analysis
Best Buy SWOT Analysis
The following SWOT analysis is for Best Buy. Best Buy is an electronics and appliance retailing company that specializes in consumer electronics, home-office products, entertainment software, and household appliances. It is one of the largest specialty retailers in the United States, serving a diverse customer base. Best Buy’s current competitors include specialty home-office retailers (Staples, Office Depot); retail discounters (Wal-Mart); wholesale clubs (Costco, Sam’s Club); and online competitors (Amazon, Circuit City).
Strengths
* Revenue of $16.26 Billion and profit of $651 million in 2011 * Operate more than 1,150 stores in the U.S. and abroad * Retail class leader based on customer satisfaction surveys * Leading U.S. retailer in computers, televisions, tablets, and cameras * Implementation of green initiatives to reduce electronic waste
Weaknesses
* Initially established image as a lower quality retailer * Impact of class action lawsuit settlement in 2011 * Previously neglected niche market for higher end products
Opportunities
* Purchase of Carphone Warehouse Group interest (U.S. / Canada) * Growth in sales of mobile phones and tablets * Improving inventory management through long-term relationship with suppliers * Further expansion of chain by opening “mobile” stores * Increasing availability of higher end merchandise
Threats
* Online competitors * Pressure from competitors to reduce prices * Rising labor wages * Current economic trends
Amid stiff competition from online retailers and retail discounters such as Amazon and
Wal-Mart, Best Buy should take a closer look at its current business strategy. Revenue and profits for 2011 were higher than forecasted. However, sales for 2012 have declined, indicating that Best Buy’s current restricting efforts may be insufficient to offset the pressures faced by the organization. Best Buy’s management needs to
The following SWOT analysis is for Best Buy. Best Buy is an electronics and appliance retailing company that specializes in consumer electronics, home-office products, entertainment software, and household appliances. It is one of the largest specialty retailers in the United States, serving a diverse customer base. Best Buy’s current competitors include specialty home-office retailers (Staples, Office Depot); retail discounters (Wal-Mart); wholesale clubs (Costco, Sam’s Club); and online competitors (Amazon, Circuit City).
Strengths
* Revenue of $16.26 Billion and profit of $651 million in 2011 * Operate more than 1,150 stores in the U.S. and abroad * Retail class leader based on customer satisfaction surveys * Leading U.S. retailer in computers, televisions, tablets, and cameras * Implementation of green initiatives to reduce electronic waste
Weaknesses
* Initially established image as a lower quality retailer * Impact of class action lawsuit settlement in 2011 * Previously neglected niche market for higher end products
Opportunities
* Purchase of Carphone Warehouse Group interest (U.S. / Canada) * Growth in sales of mobile phones and tablets * Improving inventory management through long-term relationship with suppliers * Further expansion of chain by opening “mobile” stores * Increasing availability of higher end merchandise
Threats
* Online competitors * Pressure from competitors to reduce prices * Rising labor wages * Current economic trends
Amid stiff competition from online retailers and retail discounters such as Amazon and
Wal-Mart, Best Buy should take a closer look at its current business strategy. Revenue and profits for 2011 were higher than forecasted. However, sales for 2012 have declined, indicating that Best Buy’s current restricting efforts may be insufficient to offset the pressures faced by the organization. Best Buy’s management needs to
References: Abraham, S.C. (2012). Strategic management for organizations. San Diego, CA. Bridgepoint Education Fitch Lowers Best Buy Outlook to Negative on Pronounced Headwinds. Retrieved 19 May 2012 from http://online.wsj.com/article/BT-CO-20120416-709393.html. Annual Reports. Retrieved 20 May 2012 from, http://phx.corporate-ir.net/phoenix.zhtml?c=83192&p=irol- Reportsannual.