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Best Buy CEO resigns: Struggling retailer begins searching for a savior

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In a surprising, but not extremely surprising, move today, Best Buy has released a statement saying that Brian Dunn has resigned as CEO of the struggling electronics retailer. This move comes just a few weeks after Best Buy announced big losses for the past few months and plans to close 50 stores in the United States.

According to the press release, there were “no disagreements between between Mr. Dunn and the company on any matter relating to operations, financial controls, policies, or procedures.” Yet without any disagreements, it was still a “mutual” decision that the company decided to move on. Puzzling. Director G Mike Mikan has been named interim CEO while the company looks for a new leader.

“I have enjoyed every one of my 28 years with this company, and I leave it today in position for a strong future. I am proud of my fellow employees and I wish them the best,” said Dunn. 

“We thank Brian Dunn for his many years of service to the company and wish him well in his next endeavors,” said Schulze. “As we move forward, we are very pleased to have a strong leader with Mike Mikan’s credentials as interim CEO.”

“The Best Buy team and I will be extremely focused on successfully managing this period of transition. I want to assure our employees, customers and other key stakeholders that we will work together to achieve our company’s growth and profitability goals,” said Mikan.

While Best Buy is trying to paint this as a rosy, fun-filled day for all involved, the company would not be looking for a new CEO if it didn’t have some disagreement with how Dunn has been running things. Dunn is a 28-year Best Buy veteran and has worked his way up the corporate ladder. The other option is that he simply wishes to retire and doesn’t want to helm a retailer like Best Buy, which is quickly being hurt by Web stores like Amazon.com and NewEgg.

Best Buy is planning to open 100 mobile-only stores in the coming year, but has only fully embraced mobile gadgets and electronics in recent past. For years, the company has mostly sat on its hands as physical media sales have declined and customers began going elsewhere to buy their electronics due to perceived high prices and increasing number of upsells like warranties, buy back programs (check out our study on last year’s Buy Back Program), store credit cards, restocking fees, and other somewhat deceptive tactics to get more money out of customers. Best Buy’s large stores have gotten noticeably emptier in the past few years as well as gadgets have gotten smaller, yet the company hasn’t changed the design of its stores until recently. It now plans to create stores revolving more around customer experience and service, not stacks of electronics. It claims that there are already test stores out there using this model. Sale of online services like CinemaNow and growth of Best Buy’s online store is also on the goals list.  

It will be interesting to see where Best Buy heads from here. It’s difficult to know who it might pick, or who would want the job. Hopefully it picks a leader that helps the company put customers first. The retailers that seem to be thriving these days are either trying to be Walmart or using more of the Apple store model, where customer service and experience comes first and the store is as much a meeting place as it is a place to purchase.  

(Image via Reuters)

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