Best Buy CEO leaves amidst criticism

Stores were closed and jobs axed, but the retailer's failed to adapt

Best Buy

Best Buy Chief Executive Brian Dunn has left the electronics retailer, though according to some experts his presence won't be sorely missed.

Best Buy's been referred to lately in some circles as an "Amazon showroom," where crafty consumers go to test out expensive purchases like TVs and cameras before turning to cheaper online storefronts to actually make their purchases.

Consumer trust has been waning

The retail giant has been losing consumer trust for years and Best Buy's prices are often higher than their online and even physical counterparts, and some blame Dunn in part for failing to adapt the company's strategies to a rapidly changing market.

"I hate to be rude, but I think he (Dunn) was doing a terrible job. This is a company that had a sales guy in charge, and I just don't think they are well positioned to deal with the onslaught from the Internet," Wedbush Securities analyst Michael Pachter said in a published report.

"They have a big disadvantage to the Internet retailers because they have a big cost structure. So they need a guy who can fix that rather than trying to sell more stuff."

Stores and jobs have been axed

Best Buy's recent string of financial losses prompted the company last month to announce the shuttering of 50 retail stores and loss of 400 jobs.

At the same time, they plan to open 100 smaller, mobile locations in the US in fiscal 2013 and cut $800 million in costs by fiscal 2015.

Similarly, in late 2011 TechRadar reported that all 11 "pilot" Best Buy stores in the UK would be closing down, although the company had also purchased Carphone Warehouse's mobile phone business in the US for $1 billion.

Best Buy stock dropping

Best Buy's shares this morning were down to $21.62, the lowest they've been since December 2008. Their stock has fallen 32 percent since Dunn, who started working for Best Buy as a sales associate in 1985, became CEO less than three years ago.

"There was mutual agreement that it was time for new leadership to address the challenges that face the company," Best Buy said in a statement. Director Mike Mikan is serving as interim CEO until a replacement for Dunn can be found.

Unless that replacement can seriously alter Best Buy's current predicament, the retailer's fortunes aren't likely to improve any time soon.

Future US is also a partner with Best Buy and publishes @GAMER, The Official Games Magazine of Best Buy.

Via:Reuters