Best Buy’s recent announcement that it will be closing 50 large stores and opening 100 smaller ones has prompted Bloomberg to proclaim that “the era of big-box retail dominance is coming to an end.”
Best Buy’s announcement came on the heels of reporting a $2.6 billion loss in late March, following five straight quarters of profit decline. Cautious consumers, higher gas prices, and a shift to online retailing put a dent in Best Buy’s profits. The result is a shift from the big-box model to smaller stores and internet sales.
Other big-box retailers such as Wal-Mart, Target, Staples, and Sports Authority are also working on smaller stores in high-traffic urban settings as an alternative to their big-box stores. Wal-Mart, for instance, has plans to open a Wal-Mart Neighborhood Market in West Hartford in late 2012.
