It's really not a great time to be in retail consumer electronics sales. Or maybe it's just not a great time to be Best Buy. The United States' largest consumer electronics retailer hasn't had a great year, with its CEO stepping away and sales / profits sliding. Now, it's taking measures to ensure that it doesn't slip too far behind, and that's bad news for select employees. The company has just confirmed a 1.4% employee cut, representing 2,400 jobs. This is following the company's announcement that it would have to close 50 lower performing stores in the U.S.
Best Buy will cut 600 of those jobs from Geek Squad (which currently employs around 20,000 people), with the other 1,800 coming from "store staff." It's a small fraction of its 167,000 employees, but it'll still pinch quite a number of communities. Best Buy said in a statement: "These changes were previously announced as part of the leadership team’s ongoing turnaround plan," but seeing it come to fruition still stings. All told, Best Buy is hoping to hit $800 million in cost reductions by fiscal 2015, so it still has a ways to go.
Naturally, many analysts cite increased competition from the likes of Amazon as a primary reason for Best Buy's hurting, but we're sure heightened fuel / shipping charges and cutthroat margins don't help either.