It’s going to take more than a new CEO to fix Best Buy’s problems, but at least it’s a start. At best, it’s a signal the board is getting ready to be more aggressive about shaking things up and reinventing the brand.
Although Best Buy shares popped after the news broke that Brian Dunn resigned and a search for a new CEO is underway, the euphoria was short-lived and Best Buy shares have since retreated. That is likely an acknowledgement of the tough task ahead.
“They need a new, strong operating CEO to help come in and do some radical things to make some changes,” said Joe Feldman, assistant director of research at Telsey Advisory Group.
The news was somewhat surprising given the company had laid out a restructuring plan less than two weeks ago. According to Feldman, investors don’t want Best Buy reaching for growth right now. Instead, he said, investors want to see Best Buy maximizing the opportunities it currently has and operating in a more efficient manner.
Feldman said this may mean shuttering large numbers of stores, rethinking the types of displays it uses to showcase its products and investing more in product promotions and discounts, even if it means lower profit margins.
But others feel those types of solutions won’t solve the problem entirely.Page 1 of 4 | Next Page