Best Buy - the world's largest home appliances and electronics retailer

Best Buy is the world's largest retail, distribution and service group for home appliances and electronic products. Best Buy's corporate group includes Best Buy Retail, Music Garden Group, Future Mall, Magnolia Hi-Fi, Hotline Entertainment, Future Shop, and Five Star Appliances. BESTBUY is in a leading position in the same industry in North America, focusing on corporate vision, mission and values. Best Buy ranks 66th in the Fortune 200 and 142nd in the Fortune Global 500.

Best Buy's development in China:

1. Test the waters with dual brands

It took Best Buy three years to enter China and open its first store. As early as 2003, Best Buy established an office in Shanghai. Purchasing products from Chinese home appliance manufacturers became the main task of the office at that time.

Starting with procurement, Best Buy got to know local suppliers better. By 2005, Best Buy's procurement in China accounted for 72% of its global procurement, and Hisense, Haier, Changhong, Xiahua, etc. were all its important suppliers. In fact, the annual sales of 500 billion yuan in China's home appliance industry was the most important reason that attracted Best Buy to make up its mind to enter China. Since 2005, Best Buy has begun to look for store resources in China and wanted to sell the former IKEA store in Madian, Beijing, but unexpectedly it was intercepted by Pengrun Electric Appliances under Huang Guangyu.

After many setbacks, Best Buy acquired a controlling stake in Five Star Appliances for $180 million in May 2006. According to the agreement between the two parties, the Five Star brand will be retained, which also strengthened Best Buy's determination to pursue a dual-brand path.

An insider of Five Star Appliances revealed that the so-called dual-brand means that in Five Star's base in Jiangsu and Zhejiang, the company will still focus on the "Five Star" brand and wait for opportunities to expand; while in first-tier cities in China, the company will compete with Gome and Suning with the "Best Buy" brand.

2. Challenge the unspoken rules

On the opening day of the Shanghai store, local suppliers also disappeared into the crowd. All Best Buy salespeople were Best Buy employees, with no salespeople sent by manufacturers. Home appliance suppliers who were used to sending salespeople to promote products on the front line were clearly not too confident about Best Buy's model.

But what caught the attention of Gome, Suning and many suppliers was the "pay first, then take delivery" model proposed by Best Buy. This fundamentally overturned the "quasi-finance" model on which local home appliance retailers rely for survival and expansion.

The so-called "quasi-financial" model refers to home appliance retailers using credit terms to occupy suppliers' funds, and using these cash flows to expand wildly and compete for store resources.

In the view of home appliance chain expert Luo Qingqi, Best Buy's payment-before-delivery policy puts the business risk on itself, creating a win-win situation for suppliers, consumers and itself. While domestic home appliance chain sales companies are rapidly expanding, they have almost transferred all business risks to manufacturing companies, greatly inhibiting their capital turnover.

Announcement on withdrawal from China:

Best Buy Website Announcement

On February 22, 2011, Best Buy announced on its official website that it would close nine Best Buy stores in mainland China and planned to open nearly 50 Five Star Appliance stores in China during fiscal year 2012. The announcement stated that Best Buy's strategic focus in China would be refocused on the development of profitable retail platforms.

The announcement stated that this strategy includes the optimization and adjustment of all Best Buy brand store operations. Best Buy will close 9 Best Buy stores in mainland China. At the same time, Best Buy will also close its retail headquarters in Shanghai and integrate its business operations in China into its Five Star Appliances brand.

This is the end of the knowledge about Best Buy in this issue. If you want to get more information about Best Buy, please pay attention to ~