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Economics of Best Buy

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Economics of Best Buy
One of the fortune 500 companies in our society is Best Buy. Best Buy is one of the largest consumer electronics retailer company in the United States and Canada. There are many products Best Buy distributes, such as; computers, computer equipment, video and audio products, refrigerators, coffeemakers, compact discs, video games, DVD and VHS movies and players, CD’s, computer software, cameras, cell phones, and satellite systems and so on. In addition, their customer service is very helpful and has improved throughout the years. The Geek Squad is one of their forms of customer service they provide and they offer various computer-related services and accessories for residential and commercial clients. Best Buy didn’t always have these products and services available. They are an industry that changes with the times. They supply products that are in high demand by the consumers. Best Buy was started in 1996 by Richard R. Schulze and his business partner James Wheeler. It was originally known as Sound of Music and the first store was located in St. Paul, Minnesota. In 1983, the company’s name was changed to Best Buy and the first store named Best Buy was located in Burnsville, Minnesota. By 1984, there were only 8 Best Buy’s in the Midwest, but by 1987 the number tripled and their sales and earnings were at a high $239 million and $7.7 million respectively. And since they have money to spend, they increased their warehouse size and products. In 1985, Best Buy went public and then two years later they were listed on the New York Stock Exchange. By 1988, sales had doubled to $439 million, but net earning declined 64%.Despite the net earnings declining, revenues were still increasing well into 1989. Also, in 1989, Best Buy launched its Concept II stores with bigger show rooms, fewer sales people and more self help product information. From 1992-1993 Best Buy had the best financial performance in the company’s 27 year history with an increase in revenues and earnings.


Cited: Best Buy Co., Inc.. 2010 funding universe. 5/7/10 .  "Best Buy." Company Profiles for Students. 1999 ed.  Best Buy Launches New Holiday Advertising Campaign; Alliance with Major Entertainment Groups Highlight Customer Experience. 2002 Business Wire. 5/7/10 .  Best Buy Using Reviews in Advertising. 2010 Bazaarvoice Inc. 5/13/10 .  Best Buy. 2010 Mahalo.com inc. 5/7/10 .  Coleman, Quentin. Public Corporation Information. 2010 eHow. 5/11/10 .  Hamilton, Anita. Why Circuit City Busted, While Best Buy Boomed . 2010 Times Inc. 5/13/10 .  January and February Best Buy Advertising. 2010 Barry Judge CMO of Best Buy. 5/11/10 . Muller, Turley. Best Buy Will Benefit from Reduced Competition. 2008 Seeking Alpha. 5/7/10 .  Watson, Julie. Best Buy vs Circuit City. 2006 Forbes.com inc. 5/13/10 .
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