BestBuy own-brand sales of electronic products rose

U.S. consumer electronics retail leader on the election of the company (Best Buy) is accelerating the expansion of own-brand electronics business, in order to obtain a competitive advantage against Wal-Mart (Wal-Mart) and Amazon (Amazon) and other rivals.

The introduction of the electoral performance of own-brand Hot, ended only by the end of February of the fiscal year, although elected on revenue and profit decline in the overall, the company’s own brand of electronic product sales rose 40%. On the election and collect from each retail customer feedback, and innovative electronic products to add functionality.

Popular election of the own-brand products, including Google search functionality with the positioning system, can display the name of the high-definition music radio receiver and remove the music player, additional features such as high-priced digital photo frame and so on. On the election’s top five includes hundreds of brand electronic products, including TV Insignia and Dynex, Rocketfish and video lines.
Retail experts believe that if consumers have a brand from the loyalty, the company is expected to widen the gap with competitors. In the rival Circuit City (Circuit City) declared bankruptcy last year after the election in the consumer electronics market more stable.

Own brand of research and development, however there are risks, would threaten to sell their own products with other brand operators in the relationship between own-brand is also a double-edged sword, even though the election will help enhance the attractiveness to consumers, in the event of quality problems will hurt the reputation of the brand. On the recall election early in April had 13,000 Taiwan 26-inch Insignia television, because the product of fire cases occurred in 2.

In order to enhance the city accounted for, the election will also be part of its own-brand products directly resist getting in the door, one of the most well-known example is the low-cost routes go Vizio flat-screen TVs, the product market and the good in Waldorf City (Costco) and other retailers have to sell, and Sony (Sony) and Samsung Electronics are all hot TV commodity.

Choice also acknowledged that some companies choose not to sell low-priced products in order to avoid competing with their own products. City institutions, according to iSuppli tune the survey found that last year’s election in the city of flat-panel TVs accounted for more than 1 percent growth, Insignia and Dynex TV accounted for the city in December last year accounted for 4.9%, higher than the 2.3 percent the same period last year.

Best Buy, C’City Battle Tough Quarter
NEW YORK— A weak economy, war-worries, and an exceptionally promotional holiday period took their toll on the industry’s two largest retail chains, Best Buy and Circuit City, which reported soft same-store sales for their just-ended fiscal fourth quarters.
At Best Buy, companywide comps slipped 0.2 percent for the three months ended March 1, while total revenue rose 9 percent to $7.6 billion. For Circuit City, comps fell 6 percent for the quarter ended Feb. 28 against a 5 percent decline in net revenue to $3.2 billion.

Full-year comps rose 1.4 percent, and total sales rose 16 percent to $22.7 billion for Best Buy, while Circuit City comps grew 4 percent and net rose 5 percent to $9.96 billion for its fiscal year.

Best Buy CEO Brad Anderson blamed “the challenging economic and political environment [for] constrained revenue growth” during the quarter, but said the company continued to effectively manage its promotional activity and expenses as consumers pulled back on spending.

Circuit City CEO Alan McCollough attributed his company’s fourth quarter performance to “the soft economy and continued declines in average retails across many product categories.” He also cited a 10 percent slide in comp store sales in February, which was triggered by “concerns over the economy and national security” and severe weather over the Presidents’ Day weekend.

McCollough also defended his controversial decision to end commissioned sales and lay off its 3,900 highest paid — and therefore most effective — sales associates. “We saw no apparent disruption in the sales pace immediately following the implementation of the compensation change,” he said, “reinforcing our belief that this move was the right one… We believe that our February results illustrate that drivers for success are our state-of-the-art training programs and the personal commitment that our store associates make to customer service.”

On the product front, both companies reported strength in LCD and plasma displays, which, said Best Buy, emerged as “high-volume products” during the quarter. Other pockets of growth included DVD movies and video game software, while both chains cited weak sales of personal computers.

Broken out by division, net sales at Best Buy’s flagship stores grew 11 percent to $6.4 billion for the quarter while comps grew 1.3 percent. Total sales at Musicland, which closed 128 stores during the quarter, fell 15 percent to $580 million while comps dropped 13.3 percent, owing to slow mall traffic, soft CD sales and increased competition. High-end A/V specialist Magnolia Hi-Fi enjoyed a 28 percent hike in fourth quarter revenue to $40 million, while comps declined by the low single digits.

Propelled by new store openings, sales at the company’s Canadian operations, comprised of Future Shop and Best Buy stores, grew 23 percent to $580 million during the quarter, while comps edged up 0.6 percent.