Best Buy puts "Hot Items" Behind $200 Membership Fee

[IPD]

Best Buy is once again trying to destroy any market appeal it has.  Kudos, you clueless morons.  You were already late to the bus with online shopping, and now you are trying to tick off your remaining customer base.

 

Heck, virtually every educated consumer only uses BB as a place to window shop before buying elsewhere online.  The only time they (or I) actually buy something there is when it's an "emergency".

[AdamDude]

will never buy from them again, that is customer abuse

[AdamDude]

desperation. the Local Best Buys business was doing so bad, it moved into a much smaller store. it a stand alone store, now its in a strip mall

[Dredgy]

On 10/13/2021 at 11:47 AM, poochyena said:

Being upset over other people's happiness is very strange.

No you don't. Australia isn't requiring businesses to replace products that the customer breaks within 2 years of purchase.

Actually, yes they do. The law is that the product is covered during its “reasonable lifetime”. For example if a fridge has a warranty of 2 years, but breaks after 10 years, then it is still covered under Australian Consumer law  because the reasonable expected lifetime of a fridge is 20 years plus. Manufacturers or retailers are required to replace and will usually do so the instant you mention the ACL.

 

A GPU or gaming console that fails after 2 or 3 years is definitely covered.

[poochyena]

49 minutes ago, Dredgy said:

Actually, yes they do.

No, it doesn't. I already explained this once. The law you are referencing is a warranty. What this best buy program is is insurance. Do I need to explain the difference between a warranty and insurance again?
Warranty only covers damage due to manufacturing negligence.

Australia isn't forcing companies to refund you if the item you buy from them burns in a house fire.

[ichihaifu]

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[mr moose]

5 hours ago, poochyena said:

 

Australia isn't forcing companies to refund you if the item you buy from them burns in a house fire.

Already covered by contents insurance,  but still,  $200 for not only what is basically after sales support that should be free but for the option to buy from them in the first place is BS. 

 

And yes, only 14% of Australian and NZ don't have contents insurance.  Which is pretty abysmal as it isn't expensive.  So if you can't afford that you can't afford a GPU or PS5 let alone a $200 ass poke for the pleasure of buying it.

[Roswell]

On 10/14/2021 at 10:04 AM, IPD said:

Best Buy is once again trying to destroy any market appeal it has.  Kudos, you clueless morons.  You were already late to the bus with online shopping, and now you are trying to tick off your remaining customer base.

 

Heck, virtually every educated consumer only uses BB as a place to window shop before buying elsewhere online.  The only time they (or I) actually buy something there is when it's an "emergency".

Not sure why you’re suggesting that Best Buy is somehow doing poorly. Their profits and stock price have only risen. They’re literally doing the best business they ever have.

 

While you may not be happy and choose to whine about it, back in reality Best Buy is killing it in the retail space.

[Master Delta Chief]

So there are people here in this thread that find this more acceptable than those scalpers on eBay or other online markets... Ironic to say the least but also quite ignorant. Companies pulling of these sorts of practices should always be met with criticism nor should it be allowed to go mainstream. 

 

 

[IPD]

1 hour ago, Roswell said:

Not sure why you’re suggesting that Best Buy is somehow doing poorly. Their profits and stock price have only risen. They’re literally doing the best business they ever have.

 

While you may not be happy and choose to whine about it, back in reality Best Buy is killing it in the retail space.

They're doing average.  Combination of a late advent to change; death of every other peer-level brick & mortar competitor; covid-19 coaxing people buy buy tech (and the unwashed masses having no idea about newegg, tiger-direct, microcenter, etc).  Everyone from circuit city to radio shack to fry's to sears has gone belly up--and as with any retail space, the last one standing usually benefits.  But that only helps in the physical space.

 

They are hardly "killing it" in may sectors though & their offerings keep facing increased competition, and that leaves a small amount of certain segments that they can actually still offer anything competitive in.  Appliances and TV's are BB's weakest hand, with Wal-Mart and Target having increased competition with the latter, and THD and Lowes the former.  If Sears hadn't died off--it's quite possible that BB's appliance division would already be dead.  Console gaming is also a fair weak hand for them; they just have more diversity of products and are doing better than GameStop--which is why THAT segment hasn't died off yet.

 

The things really holding it together for BB are the phone choices (shop multiple providers at once), car audio (no real competition outside of smaller, local offerings), and low-info consumers shopping for PC's. 

 

To me, that's a sign that diversity > business model.  It allowed BB to outlast all peers--so far.  But the ones that remain aren't small fish.  THD, Lowes, Wal-Mart and Target all have superior online presence--and that's just the brick & mortar competition.  But then there's 2020 and large groups of people becoming baptized in shopping online in new ways they never previously considered.  And with that, comes new places to shop.  Consumers aren't long going to endure putting up with "locked behind paywall" crap when they are increasingly aware of alternatives.

 

The true test isn't their current quarterlies or stock prices; it's what happens when (if?) normal returns, and people are no longer constrained.  BB is headed for a K-Mart ending.

[Roswell]

28 minutes ago, IPD said:

They're doing average.  Combination of a late advent to change; death of every other peer-level brick & mortar competitor; covid-19 coaxing people buy buy tech (and the unwashed masses having no idea about newegg, tiger-direct, microcenter, etc).  Everyone from circuit city to radio shack to fry's to sears has gone belly up--and as with any retail space, the last one standing usually benefits.  But that only helps in the physical space.

 

They are hardly "killing it" in may sectors though & their offerings keep facing increased competition, and that leaves a small amount of certain segments that they can actually still offer anything competitive in.  Appliances and TV's are BB's weakest hand, with Wal-Mart and Target having increased competition with the latter, and THD and Lowes the former.  If Sears hadn't died off--it's quite possible that BB's appliance division would already be dead.  Console gaming is also a fair weak hand for them; they just have more diversity of products and are doing better than GameStop--which is why THAT segment hasn't died off yet.

 

The things really holding it together for BB are the phone choices (shop multiple providers at once), car audio (no real competition outside of smaller, local offerings), and low-info consumers shopping for PC's. 

 

To me, that's a sign that diversity > business model.  It allowed BB to outlast all peers--so far.  But the ones that remain aren't small fish.  THD, Lowes, Wal-Mart and Target all have superior online presence--and that's just the brick & mortar competition.  But then there's 2020 and large groups of people becoming baptized in shopping online in new ways they never previously considered.  And with that, comes new places to shop.  Consumers aren't long going to endure putting up with "locked behind paywall" crap when they are increasingly aware of alternatives.

 

The true test isn't their current quarterlies or stock prices; it's what happens when (if?) normal returns, and people are no longer constrained.  BB is headed for a K-Mart ending.

This is all misinformed opinion. Look at their stock performance and income, it only takes 2 seconds to Google and learn.

[ToboRobot]

If there are three groups that can take more profit by increasing prices:

Manufacturer (Actually makes the thing you want)

Retailer (unneeded middle man)

Scalpers (unwanted and needed middle man)

If the manufacturer makes more money, they might be able to invest in the product... a win for the consumer.
If the retailer makes more money, there is no benefit to the consumer.
If the scalpers make more money, they have more capital to distort the market and harm consumers.

[IPD]

43 minutes ago, Roswell said:

This is all misinformed opinion. Look at their stock performance and income, it only takes 2 seconds to Google and learn.

I've heard that myopic logic before in the days of Nardelli running THD.  All the metrics showed the company was doing great; stock prices up, earnings up, etc.  But the company was going down the crapper, and customer service when from #2 in all of retail, to #26.

[Roswell]

14 minutes ago, IPD said:

I've heard that myopic logic before in the days of Nardelli running THD.  All the metrics showed the company was doing great; stock prices up, earnings up, etc.  But the company was going down the crapper, and customer service when from #2 in all of retail, to #26.

The onus is on you to provide a citation to support your claims when you state something that goes against available fact. All you're doing is deflecting and using random anecdotal evidence.

 

Do you have any valid source to back up your claim that Best Buy is on the brink of financial collapse?

[thechinchinsong]

14 hours ago, Dredgy said:

Actually, yes they do. The law is that the product is covered during its “reasonable lifetime”. For example if a fridge has a warranty of 2 years, but breaks after 10 years, then it is still covered under Australian Consumer law  because the reasonable expected lifetime of a fridge is 20 years plus. Manufacturers or retailers are required to replace and will usually do so the instant you mention the ACL.

 

A GPU or gaming console that fails after 2 or 3 years is definitely covered.

That law is literally a dream come true for consumers. Unfortunately, this will never happen in the US. 

[IPD]

2 hours ago, Roswell said:

The onus is on you to provide a citation to support your claims when you state something that goes against available fact. All you're doing is deflecting and using random anecdotal evidence.

 

Do you have any valid source to back up your claim that Best Buy is on the brink of financial collapse?

They aren't on the brink of financial collapse.  I never said that.

 

They ARE on a declining slope though, and with indicators that require more than a cursory reading to understand.

 

But if cursory reading is all you want to do, then please invest in property development in china. 

[Roswell]

12 minutes ago, IPD said:

They aren't on the brink of financial collapse.  I never said that.

 

They ARE on a declining slope though, and with indicators that require more than a cursory reading to understand.

 

But if cursory reading is all you want to do, then please invest in property development in china. 

Well go ahead and provide reputable data to back up your claim. 

[mr moose]

5 hours ago, Roswell said:

This is all misinformed opinion. Look at their stock performance and income, it only takes 2 seconds to Google and learn.

There are too many short term people playing the stock market to use it as a long term projection.   Over 1/3rd of their value was added during Covid.    If their business model has any long term stability then you need to show that without using short term market results.  They maybe on a more permanent upward trend or they may just be riding the crisis,  the market results don't prove what you claim they do.

[Roswell]

25 minutes ago, mr moose said:

There are too many short term people playing the stock market to use it as a long term projection.   Over 1/3rd of their value was added during Covid.    If their business model has any long term stability then you need to show that without using short term market results.  They maybe on a more permanent upward trend or they may just be riding the crisis,  the market results don't prove what you claim they do.

They’ve been on a steady climb for the last 6 years, not sure what data you’re looking at.

[mr moose]

Just now, Roswell said:

They’ve been on a steady climb for the last 6 years, not sure what data you’re looking at.

Over the last 5 years they spent the first 3 years bouncing between $40 and $80 a share.  Mostly on the higher end,   then in the last 2 years (from may2020) they have gone to $113.   That is 1/3rd of their current value added during a crisis that favored stores like them and I am being generous with my napkin math.    There is nothing steady about that.      Your claim about their being in steady growth is not evidence in their share price.  At best what is evidenced is they enjoyed covid and were weathering normal trade conditions prior to that.  One serious reality is that you cannot ignore the effect covid has had on that market.

 

 

Average share prices is $63 prior to start 2020 and $110 after.

 

 

 

Another example of why you can't use market trade as a predictor of future success is AMD shares,  then spent a full 6 years grossly under value and they had a z-score that put them on the verge of bankruptcy for at least 5 of those years.  If that was evidence for how they are going to do then they shouldn't be here now. 

 

How do you propose they are going to continue at $113 a share when covid is done and people aren't buying tech en masse anymore?  

 

 

Share price follows the market, you can't use it to predict the market.

[Roswell]

12 hours ago, mr moose said:

Over the last 5 years they spent the first 3 years bouncing between $40 and $80 a share.  Mostly on the higher end,   then in the last 2 years (from may2020) they have gone to $113.   That is 1/3rd of their current value added during a crisis that favored stores like them and I am being generous with my napkin math.    There is nothing steady about that.      Your claim about their being in steady growth is not evidence in their share price.  At best what is evidenced is they enjoyed covid and were weathering normal trade conditions prior to that.  One serious reality is that you cannot ignore the effect covid has had on that market.

 

 

Average share prices is $63 prior to start 2020 and $110 after.

 

 

 

Another example of why you can't use market trade as a predictor of future success is AMD shares,  then spent a full 6 years grossly under value and they had a z-score that put them on the verge of bankruptcy for at least 5 of those years.  If that was evidence for how they are going to do then they shouldn't be here now. 

 

How do you propose they are going to continue at $113 a share when covid is done and people aren't buying tech en masse anymore?  

 

 

Share price follows the market, you can't use it to predict the market.

You realize that your graph quite literally shows steady growth from 2016 until COVID, right?

 

Honestly though, it seems you just want to debate with a “trust me bro, I just know” argument with absolutely nothing to back up your claims. 
 

Come up with some hard data that backs up your arguments, otherwise I don’t really care. Though I’m sure economists would love to get some insight into this secret info you have that they seemingly don’t!

[mr moose]

20 minutes ago, Roswell said:

You realize that your graph quite literally shows steady growth from 2016 until COVID, right?

 

Honestly though, it seems you just want to debate with a “trust me bro, I just know” argument with absolutely nothing to back up your claims. 
 

Come up with some hard data that backs up your arguments, otherwise I don’t really care. Though I’m sure economists would love to get some insight into this secret info you have that they seemingly don’t!

 

I thought maybe you understood what causes fluctuation and change in the stock market at least a little bit.  Sorry.  

 

I'll put it a little bit simpler,  Best by weathered the market prior to covid (as I already said they did) largely because they adapted to online competition,  however that doesn't mean they will be able to keep it up, nor does it show what they did to do that is a sustainable practice (you need something other than stock market numbers to get that information).   The stock market does not tell you how they will do in the future, only how they are are fairing in the eyes of investors (most of which are short term investors). 

 

I don't know what evidence you need to accept that,  but for anyone who has watched the market longer than 5 years knows that as being self evident.  Tomorrow can wipe 5 years from your companies market value simply because some secretary posted the wrong earnings report.  

 

It might interest you to know that moving forward from covid BB are actually looking at closing down a few stores and in the last year have laid off 19% of their workforce.  They have 450 leases coming up for renewal.  None of this can be predicted using stock market value.  So if you want to make claims about how good they are you need to point to something other than the stock market,  you need to point to revenue sheets that breakdown where their profit comes from and how sustainable it is.  Someone said earlier that their profit margin equals their membership fees,  If that is true then you know that regardless of what the market is doing, they aren't making money from sales. 

 

I do not need to evidence anything because I am not making claims about how good or bad their business is,  I'm just pointing out that the stock market does not prove what you think it does and that you need profit/loss statements, 10X documents, etc  that are compiled against market conditions.  

 

 

 

 

 

 

[ToboRobot]

16 hours ago, James Evens said:

Wrong.

If a manufacturer makes more money, they might be able to give it to there shareholder. .... a win for the financial market

I did use the word "might" as companies have the potential to reinvest their profits to create more/new products, or to return the profits to their shareholders.

It depends on many factors, but it's more likely that manufactures will reinvest manufacturing than retailers or scalpers.  

And companies do can do both!

[pythonmegapixel]

On 10/16/2021 at 4:34 AM, AdamDude said:

will never buy from them again, that is customer abuse

That made me laugh out loud. To suggest that you are being abused by having to pay more for a gaming console is ridiculous.

And, more importantly, how is it "customer abuse", considering that if you never buy anything from them you are not a customer?

 

Best Buy will be just fine. They have enough PS5s and graphics cards that the demand from people who will join the membership will meet supply - they aren't losing out on anything!

[eece_ret]

@LinusTech 

Car dealers do Dealer Markup ALL THE TIME for in demand items.  Just recently, Tesla, Ford Bronco, 2021 Corvette, Ford Lightning.  Looks at the price of USED cars right now.  That is straight up "scalper" logic

 

There is precedent for this behavior.  Dealers will hold this markup until the item falls out of high demand.  This allows the Mfg. to advertise low price but still sell high letting the dealership take the bad PR.  In this case, BB is taking the cash and 

 

I think Sony should pull back from BestBuy and sell direct through the Sony Store.  They could leverage any number of fulfillment and logistics firms to execute.