Plans For Best Buy Closings in 2022

Joel Eisenberg

2021 saw the venerable chain laying off over 5000 employees and permanently shuttering dozens of stores.

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Author’s Note

This article is based on corporate postings and accredited media reports. All linked information within this article is fully-attributed to the following outlets: USA Today, People.com, Associated Press, LoveMoney.com, and BizJournals.com.

Introduction

On February 25, 2021, Best Buy CEO Corie Barry hinted at then-upcoming company plans during the company’s quarterly earnings call: "In addition to our physical stores, our operating model needs to evolve to meet our customers' changing shopping behaviors that have been accelerated by the pandemic." For further information, click here for USA Today report, “Best Buy Expected to Close Even More Stores in 2021 Than Usual as Consumers Buy More Online,” by Kelly Tyko.

Indeed, for patrons of Best Buy’s brick and mortar locations, ensuing business headlines of February, 2021 may have appeared particularly dire. As People.com reported, in their Georgia Slater article entitled “Best Buy Laid Off 5,000 Employees in February, Expects to Close More Stores This Year”: The tech business has experienced a surge in online business as more people are staying home and not visiting stores in person. According to the Associated Press, Best Buy will replace the laid-off full-time workers with 2,000 part-time workers.

This type of pandemic era development was neither unexpected nor unusual for many venerable retailers. Companies such as Microsoft and Macy’s, among others, experienced similar growth in the eCommerce sector, which in turn led to a host of store closings. See here for LoveMoney.com article, “Big Companies Closing Stores Across America.”

Best Buy is included in the listing, which elaborates on the company’s recent plans: The electronics retailer has been quietly closing stores over the past few years, shutting 20 premises in both 2019 and 2020. In early 2021, it announced plans "to close a higher number this year". Although the total number of its store closures isn't readily available, it's likely that at least 60 Best Buy stores have closed so far. In November 2021, however, the company revealed that it was opening new 'experiential' outlet stores in Charlotte, North Carolina. 

The question is: Have the new strategies worked?

Let us explore further.

2022 Closing Plans

A March, 2022 Star Tribune article, “Best Buy Prepares For a Challenging 2022, Expects Growth After That” by Nicole Norfleet, touts the promise of the company’s eCommerce faction: For the new fiscal year that began last month, Best Buy executives expect business to continue to taper. Best Buy anticipates comparable sales to decline 1 to 4%. Executives said growth was expected to bounce upward by its 2025 fiscal year, which covers most of calendar year 2024, with revenue of $53.5 billion to $56.5 billion.

Per the article, the primary cause for optimism is a deepening of the use of technology on behalf of the consumer, and a stronger than expected end to the prior fiscal year.

In terms of 2022 closings, BizJournals.com also referenced Best Buy CEO Corie Barry, this time from an economic conference with Minneapolis Federal Reserve President Neel Kashkari: She predicted that supply chain issues and labor shortages — both of which have played into rising prices — could continue for another year or two. Continued outbreaks of Covid-19 globally will lead to unexpected shutdowns of factories that can ripple through the markets, while workers who had work lives disrupted by the pandemic may have found new careers and be less willing to return to their old jobs, she said.

Further specific closings have not been announced, but nor has that possibility been discounted.

Conclusion

As with so many other retail giants, Best Buy has found a renewed profit center in eCommerce.

During the peak of the initial Covid-19 outbreak, online ordering replaced in-store shopping for many customers, which in this instance became habitual; those stores that were already underperforming were closed as a cost-saving measure while online orders continued to increase.

Other store locations, however, have seen a recent increase in traffic and profitability. As a result, Best Buy is not in imminent danger of closing their stores entirely during the current calendar year, though financial experts are keeping a close eye on the retailer’s performance over the coming months.

Thank you for reading.

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I am an award-winning author, screenwriter for film and television, and producer. My mission on News Break is to share socially important perspectives on both culture and pop-culture. Member of PEN America, and the WGA.

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