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Best Buy surrenders, job losses to follow

One of the world’s most successful electronics retailers has raided the white flag store and is preparing to surround its outlets with them. Looks like more than 1,000 people could be unemployed before Christmas. Bad news, but was it predictable?

In economic terms, this recession is like the retail version of ‘The Day After Tomorrow’. What started out as a series of poor weather events, combined in new and diverse ways – culminating in a deep freeze.

The problem is that we, as a globe, are buying more technology than ever. We’re just not willing to pay for it. So, as the unit shipments go up, the actual profit being generated goes down. The market that would/should have been lining up to buy the very latest 50″, intelligent £1,500 3D TVs – has realised that Samsung’s bargain offers of 3D TVs around the £500 mark will probably look about the same.

Famous marketing guru Drayton Bird, is fond of telling a tale where consumers sit on the side lines, encouraging companies to batter each other to death with ever more extravagant and unrealistic offers – then step over the broken bones to pick out the last remaining bargains from the dead corpses.

Yep. That’s us. The bone-picking UK technology consumer.

Best Buy’s original plan was to use the UK as an aircraft carrier in its planned European invasion (sound familiar?), investing $1Bn in Carphone Warehouse.

Now the deal has turned 100% on its head, with Carphone Warehouse boss Charles Dunstone announcing that he’s selling his stake in the American phone market for $1Bn.

Back in the heady days of pre-global-economic-meltdown (i.e. 2008), the Best Buy folks had a map of Europe with 200 pins in it. At the last count, around 100 of those pins had been recycled back into the office stationary cupboard. Now, the rest could join them.

Several large retail units now available, 2 years rent free. One previous owner. No sensible offer refused.

KitGuru says: It’s hard to understand why so few stores successfully span the Atlantic. With so much US TV over here and the entire population of the States speaking English, you would imagine that the transition would be easier. But it isn’t. We wish the Best Buy employees hit by this retail disaster good luck in finding a new career. You made the right choice in joining Best buy, based on the promises and ambition shown, but us Brits just don’t seem to trust new retailers. We love John Lewis. And that’s the facts.

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