Best Buy follows failed lead of Circuit City and cuts pay, jobs
Filed under: Shopping, Technology, Consumer Complaints
Best Buy's decision to cut wages of thousands of its senior sales people, and eliminate up to 1,000 jobs, looks like a bad imitation of failed electronics retailer Circuit City.In a reorganization of the consumer electronics chain, Best Buy is cutting pay by 25% to 50% for 8,000 senior sales associates who will be demoted, according to a research note by New York investment firm Sanford Bernstein, as quoted on CNBC.com.
Sanford Bernstein also estimated that as many as 1,000 assistant store managers would lose their jobs. Best Buy wouldn't confirm or deny the estimates.
A Best Buy spokesman told CNBC that while it wouldn't disclose the number of people affected in the reorganization, the changes would put more sales people in front of customers. Many store managers and senior-level sales people will go to jobs where they'll interact more directly with shoppers.
That's great if it's true, although the 8,000 senior sales people who will see their pay drop by up to half are probably thinking of looking for new jobs. While the demotions aren't as bad as layoffs, they might as well be laid off if their salaries are being cut by so much.
Circuit City made a similar move in 2007 when it laid off thousands of its experienced sales people. As I wrote for WalletPop in November 2008 when Circuit City announced more layoffs, such decisions often are a harbinger of what is to come.
Think of any big purchase you've made, especially something technical that you didn't know much about. I've had many Best Buy, Circuit City, The Good Guys and other home electronics store workers educate me on products I've bought from their stores. But after Circuit City got rid of its senior sales people, you could see the level of customer service drop. I almost knew more than some sales people there, so I stopped shopping there.
If Best Buy's moves add more happy, well-paid and knowledgeable workers to the sales floor, then more power to them and thus more power to the consumer. But if the extra sales people are underpaid, inexperienced and can't explain the latest electronic gadget, then more customers are likely to walk out the door empty-handed.
Aaron Crowe is an unemployed journalist in the San Francisco Bay Area. Read about his job search at www.AaronCrowe.net
Reader Comments (Page 1 of 1)
4-23-2009 @ 1:01PM
gabe said...
I went to Best Buy to purchase a Camcorder which I did and to protect my purchase I also bought the "Black Tie warranty for an additional $56.00.-
After 36 days and after filling 2 tapes I tried to connect the camcorder to my tv and realized that the camcorder was malfunctioning.
When returning the camcorder to Best Buy I had an absolutely horrible experience. Customer Service at least in the Meriden CT Store and the North Haven CT store is deplorable.
The floor staff has a minute knowledge of Audio/Visual/PC EQ..
Their Return policy is unfair - 15% restocking fee on returns... NO MATTER WHAT. After 15 days- YOU ARE ON YOUR OWN.
If the product you purchased is malfunctioning and you were lucky enough to buy the "Black Tie" Insurance they turn you over to the "geek squad" (High School Flunkys). Basically they are Best Buy employees that are disguised in different uniforms so that the Best Buy diverts their blame and shortcommings to a third party.
Oh the Geek Squad-When trying to trouble shoot problems with my brand new camcorder they had no cables or tapes to test the equiptment and refused to use their own inventory. Basically they told me I could either purchase more cables so they could test my equiptment or they could ship it out and I could expect to get my camcorder back in 30 days (again it was 36 days-new).
At this point- being enraged I asked for the store manager (High School Flunky #12) and he made a side deal suggesting that I purchase another camera while this one was being fixed and return it within 15 days and they would cover the restocking charges- In doing so he was apparently breaking store policy.
Trying my luck I went to another store-walked up to the "Customer Service" desk explained to the cashier that my camcorder was broken. that I had a "Black Tie" warranty and her response was "So what do you want me to do about it?"--
"Did you get the black tie Insurance?" and snaps her gum and point to the geek squad booth.... Ugghh
DO NOT BUY PRODUCTS FROM BEST BUY.
Reply
4-30-2009 @ 2:39PM
Nick said...
Gabe,
In response to what you experienced at Best Buy I apologize, but to say never buy anything at Best Buy ever seems very far fetched with the lack of Consumer Electronic Stores still open these days.
I currently am employed at Best Buy as a part-timer as I make my way through school. I am not in CT, but I do work in OH.
The one I am at currently is the 2nd Best Buy I have worked at. I have to say that as far as the 2 stores I have worked for go, we go above and beyond to take care of the customer. I have worked at Best Buy for 5 years now and have had very few complaints from an employee standpoint.
I hope that your future experiences with Best Buy are better. You are right about some of the policies that Best Buy have, they seem a little out there, however, do elaborate on why some items have a 14 day return policy and some have 30 can be contributed to the standard life cycle for those products.
When looking at Laptops, Camcorders/Digital Cameras, and GPS units the 14 day with a 15% restocking fee return policy is in place because they all have a half-life cycle. The standard life cycle for electronics generally is about 6 months, but for those select items they get changed out about every 3 months. Another factor is the lack of margin in those items, and before you doubt that I want you to also think about the consumer demand of these products that have driven down the prices and also the overhead which is associated with operating a store.
I have had people ask me time and time again why there is a 14 day return policy and time and time again I state why. In theory it isn't the most practical policy, but in the end Best Buy is still here to stay and I doubt will go anywhere anytime soon.
Reply