Course Project - Best Buy Research Paper Example | Topics and Well Written Essays - 750 words

Course Project - Best Buy - Research Paper Example In 1981, Schulze attended a weeklong management seminar which made him take a step in expanding the Sound of Music’s to include VCRs and other appliances. Later on in 1984 he introduced the superstore format which greatly expanded warehouse sizes and product offerings leading to quick capture a large portion of the market (Pederson & Gant, 2004). During the late 1980s, competitive companies were established since they realized the huge profits made by Best Buy Company from the superstore format and from the sale of hot ticket consumer items such as VCRs (Pederson & Gant, 2004). Highland Superstores a chief competitor to Best Buy Company, made it decline its net earnings after entering Best Buy’s core Twin Cities market in early 1987 (Pederson & Gant, 2004). For some time, both companies benefited from the market share increases and profits, but finally the market was overcrowded by other stores who were competing for the same dollars. The decreased profits by Best Buy Company made Schulze come up with the idea of building Concept II stores in 1989, which would make the company more noticeable from the competition since the average customer recognized little difference among the superstores (Votteler, 2002). The idea behind Concept II stores was to ensure that shoppers were entering electronic discount stores which had limited need for sales aid and a desire for hassle free buying which would ensure no waiting for merchandise from the back room or switching from counter to counter. Thus, the Best Buy stores would have well stocked showrooms, fewer salespeople, more self help product information, one stop purchasing of products and answer centers for those with questions. These were some of the best effective strategies used by Best Buy Company to fight off competition. In April 1991, Highland stores exited the metropolitan area, conceding defeat and