Photo: By Ron Dauphin on flickr
With the ever-present Amazon wrecking it on the online front, Best Buy has been looking to downsize its brick-and-mortar footprint to help it compete. Over the weekend, Best Buy announced the locations of the 50 stores that it’s closing as part of its $800 million cost-cutting plan.
UBS analysts did a “proximity analysis” on Best Buy’s stores that are closing, and it doesn’t look good. When a retailer closes stores, its former customers have to go somewhere.
From the UBS report:
“The results show that it will likely be hard for [Best Buy] to recapture many of the lost sales since the mass merchants and other [consumer electronics] retailers have stores that are within striking distance.
“[RadioShack] has a store within 1.6 miles of the [Best Buy] locations, [Walmart’s] average nearest store is 3.0 miles, while [Target] has stores within 4.1 miles.“
Like any other big retailer, Best Buy would like to retain customers after the cuts by having them go to another one of its locations nearby.
It looks like that’s not going to happen, and that share is going to slide over to its biggest competitors.
RadioShack should be quite happy about that.
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