SWOT Analysis Of Best Buy, Best Buy is a Minnesota electronics retailer with more than 50 years of experience in the industry. It’s not just surviving It’s prospering, and it has a reason. To know the reason Best Buy is doing well when other retailers fail is a thorough Best Buy SWOT analysis.
Did You Know?
From 1966 to 1983, the company was known as Sound of Music. Yep, like the movie.
The retailer based in the US of cellphones and consumer electronics saw a significant increase in sales on its website on the US market during the outbreak. The massive investment in technology during the last few years have paid off, as COVID-19 devastated the US and caused a dramatic increase in unemployment, and disrupted businesses across the world.
Best Buy At A Glance – Best Buy SWOT Analysis
Company: Best Buy Co., Inc.
Founders: Richard M. Schulze
Year of establishment: 1996
CEO: Corie Sue Barry
Headquarters: Richfield, Minnesota, United States
Employees (Dec 2020): 1,25,000
Ticker Symbol: BBY
Annual Revenue (Dec 2020): US$43.6 Billion
Profit net income (Dec 2020):US$1.5 Billion
Products & Services: Consumer Electronics | Best Buy Mobile | Geek Squad | Magnolia Audio Video | Napster | Pacific Kitchen & Home | Best Buy Express | Repair Services | Warranty Service | Service Plans
Company Website: Best Buy International: Select your Country – Best Buy
Best Buy Competitors
Competitors: Amazon | Walmart | Target | Sears | eBay | Lowe’s | Costco | Staples | Office Depot | Home Depot
Best Buy SWOT Analysis – SWOT Analysis Of Best Buy
SWOT Analysis Of Best Buy analyzes the brand based on its strengths weak points, weaknesses, opportunities, and threats. With Best Buy SWOT Analysis it is clear that the advantages and disadvantages are internal factors, while threats and opportunities are external elements. Here we are going to talk about Best Buy SWOT Analysis.
Below Is The Detailed SWOT Analysis Of Best Buy.
Best Buy’s Strengths – Best Buy SWOT Analysis
- dominant market position: The Best Buy enjoys all the advantages of being the biggest and most popular electronic retailer. It owns 1,231 stores across all of the US, Europe, Mexico, China, Turkey, and Canada.
- Innovative Sales-Service Strategy The biggest issue for customers is the absence of information about the various electronic. Best Buy is tech agnostic and has solved this problem with tools that allow customers to assess the brands it sells, expert consultations,and service for all the products it sells.
- Strategic Acquisitions Over the last few years, Best Buy made several strategic acquisitions which allowed the retailer to capitalize on lucrative opportunities. Best Buy acquired Great Call in the year 2018 and its toolkit Critical Signal Technologies, in 2019 which allowed it to get into the senior health industry faster than its competitors.
- Amazing Customer Support: Love pays, it’s as simple as that. Best Buy is customer-centric and guarantees its customers access to services and products either via technical support via Geek team support or directly from an store staff member. The customers who love them are spending 1.5 to two times the the average. More love, more money.
- Great Omni-Channel An ideal store that is designed to encourage customers to stay longer and to act on their desires. The longer they are there, the more they purchase. Best Buy invested heavily to integrate stores in its E-commerce strategy which led to an increase in the in-store and online sales.
- A unique BOPIS mix Every Best Buy’s store are utilized to deliver online orders which is 93% percent of orders returns being processed at stores. Also, it introduced pickup points at the UPS as well as CVS stores for customers who purchase online. This unique mix is highly effective evidenced by the increase in Best Buy’s BOPIS (buy-online-pickup-in-store) by 40%.
- Intense Cost Management: Since the year 2017 the profits of Best Buy have risen dramatically due to its cost-effective management. Its interest expenses have dropped by $72 million from 2017 and will be $64 in the fiscal 2020 while other retailers face cost increases.
- Strong market presence: Although Best Buy only has 997 stores across the US it has spread its stores evenly across the entire market. 70 percent of Americans reside within 10 miles from the Best Buy store, which has led to increased sales and helped to increase its financial success.
- Comprehensive Collection: Apart from its extensive range of consumer products, Best Buy also has its own brands, including Magnolia, Insignia, Modal, Pacific Sales, and many others.
Best Buy’s Weaknesses – Best Buy SWOT Analysis
- Restricted to the US: The retailer has an number of stores totalling 1231 worldwide with 997 stores situated within the US. This is the reason Best Buy is not popular or well-known outside of North America. The fact that it is restricted in and throughout its home in US puts the business at risk to a variety of problems in the marketplace.
- Negative Publicity In January of 2020 it was disclosed that the Best Buy board was investigating claims of an unsuitable romantic relation with Chief Executive Officer Corie Barry and a different company executive. The allegations against the CEO paint the company as not trustworthy.
- Dependence on Electronics The technology is constantly evolving and constantly changing, which can increase the risk of electronics. Electronics used from Best Buy to drive sales could become obsolete in some months to a few years. What’s next?
Best Buy’s Opportunities – Best Buy SWOT Analysis
- A Focus on Senior Health: According to a study by Morgan Stanley, Best Buy is able to make more money from healthcare than electronic devices. catering to the health needs of senior citizens is an excellent source of gold. Through the purchase from Great Call, Best Buy is well-positioned to reap the benefits from catering to the health of seniors.
- Increase Online Sales Although Best Buy has adopted eCommerce extremely well, it has room to grow. It must strive to reach that same degree of adoption like Amazon. In February 2020, Amazon’s online sales comprised 25% of its total salesand is still much to do.
- Expand to Emerging Markets: With the majority of its stores within the US, Best Buy should be seeking to expand around the globe. In contrast to the crowded and fiercely competitive UK marketplace, Best Buy can thrive in uncrowded markets within developing economies.
- Increase market presence: Do you want to drive 10 miles to visit Best Buy when you can buy the product at the Walmart right across the street? Most likely not. Best Buy should open more storesto fill the gaps and cut down the distance.
- Growth through Acquisition The retailer already gained through strategic purchases. But, that doesn’t necessarily mean that it will not benefit or expand through acquisitions again and again. One reason is that the declining of Sears is insufficient to be picked.
Best Buy’s Threats – Best Buy SWOT Analysis
- Intense Competition In the realm of the internet, Best Buy competes with Amazon. In turn, it has to fight against ferocious and relentless brick-and-mortar rivals like Walmart. Online as well as offline, the competitors are looking forward to ways to capture the Best Buy shares of the market.
- The looming recession is upon us: It would be not wise for any company to think that they are immune to the effects of a downturn in the economy. With the imminent recession caused by pandemics that Best Buy has experienced, its meteoric growth could soon stop abruptly.
- The inevitable nature of strikes: While the newly passed USMCA was intended to promote America’s First agenda but it has given employees more power from across the border. The employees of Home Depot in Mexico in the country in the same country where Best Buy also operates, are already looking to strike for better pay. Strikes can be infectious, so Best Buy’s strike might be too far off.
- An increase in counterfeits: Best Buy relies heavily on electronic devices, however it is targeted by counterfeiters and counterfeiters. The counterfeits from the age of digital are of top quality but are very affordable. The bargain price is irresistible for even the long-time Best Buy customers..
- Retail Apocalypse Starting from Pier 1 Imports to Sears, Kmart, Forever 21 and Walgreens All of these stores were once mighty, but they are currently looking to shut down stores by the date of the end of 2020. Best Buy is not immune to the retail catastrophe.
Best Buy SWOT Analysis Template
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