Best Buy CEO Brian Dunn Resigns After $1.7 Billion Loss

An anonymous reader writes "Best Buy CEO Brian Dunn has resigned amid the big-box retailer's major financial problems. The announcement comes two weeks after Best Buy announced a $1.7 billion loss for its fiscal fourth quarter. Best Buy is trying to avoid the same fate as Circuit City, which went out of business in 2009, but the future looks grim." The article provides a reason not to trust middle-management: the company claims it had "no disagreements with Dunn about operations, financial controls, policies or procedures." Best Buy may not be Shangri La, but in many rural and semi-rural parts of the U.S., it's the nearest and best place to actually find a wide selection of electronics.

Customer Service

[MarkvW]

Their customer service is bad. Their sales clerks are trained to be pushy. Their prices are just so-so.
No big surprise.

Misuse of "middle management"

[SashaMan]

You say "The article provides a reason not to trust middle-management".

I don't think you know what middle management means. Sure, this is a reason not to trust corporate PR, but I think it should kind of go without saying that you should never trust corporate PR, as regardless of the truth of the situation, it is their JOB to say things that are "best" for the company.

Re:So...

[Hadlock]

To be fair, he started as a $5.15/hr minimum wage employee at one of their stores and worked his way up the ladder through literally every department before being named CEO. There are many CEO salaries and pensions to guffaw at, but this guy deserved at least half of what he gets.

Re:Customer Service

[mx+b]

I don't know if it was just the local branch or if its nationwide policy, but I know 1st-hand and 2nd-hand (people that worked there, etc.) that the managers were incredibly pushy on the sales reps to essentially harass customers and find out how much money they had, then upsell as much as possible. Especially for people obviously not knowledgeable on the topic. If you didn't push the more expensive version or the extended warranty or whatever, the managers came down hard on you. Terrible environment. I refuse to ever shop there again.

Re:Best place for electronics????

[SJHillman]

I am from one of the more rural parts of the US. There's a few issues with Amazon:
1) Most users aren't comfortable buying parts online - they want a salesman to tell them exactly what to buy
2) Rural FedEx/UPS/USPS drivers tend to be much more careless with handling packages - probably due to having much longer routes through places with no cell service and no intersections to use as points of reference for directions. It's also much more common for rural houses to not display house numbers... or even have them in the first place.
3) I can drive to Best Buy and buy a replacement part and have it installed the same day. Gas will probably cost around $5-$7 for the round trip. Buying stuff online will often cost the same for basic ground shipping (free shipping is usually very slow) and then you have to wait several days for it.

Amazon/NewEgg/Tiger/ZZF/etc are great if you know you need something in advance and the carrier can actually find you, but they're not the solution to every problem.

Re:So...

[Anonymous Coward]

He got $10 million in compensation in 2010, and he's still on the board of Dick's Sporting Goods. So he's not suffering at all.

http://people.forbes.com/profile/brian-j-dunn/11391

While I appreciate the romantic notion of a company's CEO starting off at the bottom and working his way to the top, I wonder if, in this case, Dunn brought the worst of his experiences to the top with him instead of the best. It seems that the higher he went, the more the company got in trouble. This is a company that really needs an outsider to go in, define what Best Buy is going to be in this new retail world and how it will succeed, and get everyone in the company involved in that direction.

As timothy says, "Best Buy may not be Shangri La, but in many rural and semi-rural parts of the U.S., it's the nearest and best place to actually find a wide selection of electronics." That's great for Best Buy, but that can't be the driver for this company to stay in business. They've got to fix the problems they have, and fast, because everyone else is eating their lunch. Other than take up space, there's nothing they do better than anyone else.

Re:Best place for electronics????

[futuresheep]

That depends. Standard FedEx will deliver anywhere, but Standard FedEx is actually owned by FedEx. FedEx GROUND is franchised out and can be very hit and miss. My house is 60 miles from the nearest FedEx Ground depot. They've lied so many times about attempting delivery that I actively avoid any company that uses FedEx Ground for shipping now.

Re:Customer Service

[v1]

I have little sympathy for dealerships with staff that pull tricks to prevent you from leaving.

Then you must really hate casinos. They downright hide the exits, as well as making sure there isn't a clock in sight, so you have less chance to realize how much time you've spent in there already. Try it sometime, try to find a visible clock anywhere, in any casino. Or for that matter try to recognize where the exits are from almost anywhere on the floor. I still have no idea how that gets past fire regulation...

Re:Customer Service

[ArhcAngel]

You're lucky you never tried to buy anything there with $2 bills [slashdot.org] or pick up anything you ordered from bestbuy.com [geek.com] or you could have been posting from the prison library.

Re:Customer Service

[Politburo]

They likely had a higher margin on the Panasonic.

Re:Haven't had bad luck lately...

[justinlindh]

Best Buy is strictly non-commissioned. I worked there for a year when I was in high school at a store opening, and they made sure that the first thing we said to shoppers, with exuberant pride, was "Just so you know, everybody at Best Buy is not working on commission so we're only going to sell you what you need and never what you don't!". What we didn't say, which is actually the truth, is "... but we do need to give you the hard sell on product service plans (fancy words for extended warranties) or we'll get fired, and that guy hovering over there is our manager who is only listening to how well we can sell one to you". If you worked in the home theater department (I was in PC home/office), add high margin cabling to that.

Those of us who weren't naive knew we were being screwed. The only reward for pushing these products was job security and it's all so we could emphatically tell customers a lie: that we wouldn't try to sell them things they don't need.

This was 13 years ago, too... back when Best Buy was a much better place. I'm sure it's only gotten worse in recent years.

Re:Customer Service

[DuckDodgers]

I did have a sales experience where they asked for the keys to my current car to evaluate it for trade in. While their technician was examining the car, they presented me with a finance offer on the purchase of the vehicle I wanted. It was too high. I refused, and asked for my car keys. They said the technician had my car out for a test drive, and since I had no choice but to wait for him to return they would revise their finance offer. The next offer was still too high. I refused again, and asked again for my keys, and yet again was informed that the technician was still out driving my car. This nonsense continued for over an hour before I lost patience and informed them I would sit alone in the lobby until my car and keys were returned.

So a.) car salesmen can be ridiculously pushy and b.) make sure you have your car and car keys in hand before you start negotiating. After I drove off, the salesman called with a last offer that reduced the finance rate on the loan from 13% to 0%. Under other circumstances I would have taken the deal, but I was so angry over the sales tactics I still refused.

Re:So long, Best Buy...

[ravenscar]

I have found the best place to buy HDMI cables when you need one right away - Ross Dress For Less or TJ Maxx. Those stores all have an electronics section and they usually have a few random 6ft HDMI cables priced at around $10 (decent quality too). Sure, that's not as good as many of the online deals, but it's the best I've found for local and cheap. Fry's has some deals as well...