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Old Jan 4, 2013, 08:51 AM   #1
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Best Buy Complains About Walmart's iPhone 5 Holiday Sale, Claims $65,000 Profit Loss in One Day




The Wall Street Journal notes that several retailers including Best Buy and Toys "R" Us have complained to attorneys general in a handful of states about advertising practices of Walmart. Generally, the complaints stem from comparison ads by Walmart in which competitors assert that Walmart is using inaccurate pricing or non-equivalent items to claim that it offers the lowest pricing.

But Best Buy also alleges that Walmart was deceptive with its iPhone 5 holiday sale in which it dropped pricing to $127, although the article quotes $150 pricing.
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Best Buy said it lost about $65,000 in profit the day Wal-Mart's promotion first ran on Facebook, because it was compelled to match Wal-Mart's advertised $150 price, even though it concluded that Wal-Mart didn't actually have a sufficient number of iPhones available.
Walmart claims that it did have sufficient stock of the iPhone 5, quoting 98% availability at its stores carrying the device. Walmart had noted as the sale launched that it was working closely with Apple on the promotion and was securing significant numbers of iPhones, but that the sale was first-come, first-served with no rain checks offered at stores where the device was out of stock.

Best Buy had already been selling the iPhone 5 for $149.99 when Walmart announced its own sale, but it is unclear if Best Buy used the $73 difference from regular price or $23 difference from Best Buy's sale price in calculating its profit loss. Assuming the latter, Best Buy would have price matched on approximately 2800 iPhone 5 sales in one day.

Article Link: Best Buy Complains About Walmart's iPhone 5 Holiday Sale, Claims $65,000 Profit Loss in One Day
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Old Jan 4, 2013, 08:52 AM   #2
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Sounds like a bunch of whining to me.
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Old Jan 4, 2013, 09:28 AM   #3
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Sounds like a bunch of whining to me.
Yep. I know a handful of people who had shiny new $127 iphone 5's under their Christmas trees. No supply worries from my perspective in the Washington DC/Baltimore area.
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Old Jan 4, 2013, 10:18 AM   #4
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Sounds like a bunch of whining to me.
Basically. There is no law that compels them to price match so it was their fault for doing so.
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Old Jan 4, 2013, 10:58 AM   #5
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A few comments about some of the things being said in this thread:

a) People wishing Best Buy would go under is rather sad, in my opinion, as there are plenty of good people who are employed by the company. Said people have absolutely zero say in how the company's business is conducted, or which policies are enacted.

b) Best Buy does not fully train and coach 75% of their employees, especially seasonal personnel; those that are trained, are usually knowledgeable about one particular department.

c) Management (read, Supervisors and Managers) are nothing more than line-level employees that have been given more information regarding the financial health of a given store on a given day at a given time; they are then required to "drive the cattle" when sales and protection plan goals are not being met. Reading between the lines: they are still at the mercy of corporate mandated policy.

d) Price matches are, by design, a type of tool to get bodies into a store. Best Buy's profit margins are razor thin on a majority of the products (hardware) they sell, hence the heavy push of protection plans and add-on accessories. If you don't need it, don't buy it. Like the age-old argument of whether Apple Care is worth it or not, decide for yourself if the value is there.

e) The fact that Best Buy is complaining about this is comical, as they usually take a loss when selling cellular hardware. Best Buy (and other companies who sell cellular services) make the money on recurring payments to them by the major telcos (notional margin). They are making HUGE profits on everything BUT the actual sale of the phone. In fact, the Best Buy Mobile stores (within a store) are perhaps the most profitable piece of Best Buy's assets, hence the internal moves to mimic the culture of said stores.

Thanks for reading-
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Old Jan 4, 2013, 02:32 PM   #6
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Sounds like a bunch of whining to me.
Sounds like a company that got the idea, from the competitor with the fruity logo
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Old Jan 4, 2013, 08:52 AM   #7
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awww Poor Best Buy

NOT

Bunch of clueless goof balls run Best Buy. Trying to sell Monster cables and Bose junk. And their extended warrantee.

The sales reps have no idea what they are actually talking about, and considering their geek squad is run by idiots, I don't like BB.
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Old Jan 4, 2013, 02:00 PM   #8
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Originally Posted by ouimetnick View Post
awww Poor Best Buy

NOT

Bunch of clueless goof balls run Best Buy. Trying to sell Monster cables and Bose junk. And their extended warrantee.

The sales reps have no idea what they are actually talking about, and considering their geek squad is run by idiots, I don't like BB.
Don't worry, they'll be out of business soon.
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Old Jan 4, 2013, 02:15 PM   #9
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Don't worry, they'll be out of business soon.
+1 I agree.

Best Buy is going down, and crying like a baby while doing so.
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Old Jan 4, 2013, 02:35 PM   #10
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Originally Posted by shenan1982 View Post
+1 I agree.

Best Buy is going down, and crying like a baby while doing so.
The hate unleashed here onto Best Buy is in general hate towards the way the electronics industry used to and still does business.

Like car salesmen of the past they could not be trusted and many times took advantage of consumers. (Still do of the uninformed)

With the internet and Amazon their antics and overpricing became transparent
and they (so far) did not adjust.

About two times a year I go into a best buy to check things or get a quick adapter or so, but nothing ever changes. (In adapters they are actually good, because they have older stuff around that is hard to find and even at close out pricing LOL)

Most of the time I leave without a purchase, as I have researched what I want beforehand. My guess is most consumers do now , so we typically know more than their sales people.

Just a frustrating visit and a store nobody needs.

Put a fork in it, done!

----------

Quote:
Originally Posted by techwhiz View Post
Walmart does not create jobs.
WHen a Walmart goes up, the service is currently being provided by other means. THose other jobs pay more and typically have benefits.

Walmart rarely provides benefits for anything other than management. They systematically make sure most (80% or more) of their workers never cross the threshold to become benefit eligible. They have numerous wage claims in just about every state that they operate in.

The economy is bad so they get applicants. But when they put a Safeway, or some other grocery store out of business, do you honestly think Walmart has done the area a service?

Walmart, is a crap company, with crap policies, and they sneak by with some of the most unethical business practices.

I'll shop at Walmart only under extreme conditions.
You are in the minority as their sales prove.

$$$$ that's how the public votes.

Now, if they'd spend some money to hire enough cashiers, so one can get out in a reasonable time, that be gravy.
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Old Jan 4, 2013, 02:54 PM   #11
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Originally Posted by Thunderhawks View Post
You are in the minority as their sales prove.

$$$$ that's how the public votes.

Now, if they'd spend some money to hire enough cashiers, so one can get out in a reasonable time, that be gravy.
Basing fact on whether the majority agrees is rather illogical. The majority does not equate to being "right". History has proven this many times, that the general majority may approve of X factor while Y factor may be actually correct. This all amounts to being ill informed or having little choice. In this instance, Consumer A shops at Walmart because there are few alternatives for a B&M store in their area, or they may not be fully informed of the effects their long term consumer practices may have.

What I find shocking is the amount of people cheering for BestBuy to fold. It was not too long ago that other electronics B&M stores folded - CompUSA, CircuitCity - leaving BestBuy as the only national chain left in this domain (aside from Fry's and others who are not as national as BestBuy). If BestBuy folds, this equates to less competition and more market dominance by one corporate entity. That means even LESS choice for consumers, and the good chance Walmart will raise their prices on goods they are the prime supplier of in X market.

Instead of praising Walmart for shutting down another competitor, why not write to BestBuy or support another business that may need help. More competition is better for us, the consumers. Less competition + market dominance = monopoly of goods and services, which almost always leads to higher prices. Think before cheering on another B&M store filing Chapter 11, it's not doing you or anyone a service.

----------

Quote:
Originally Posted by Morshu9001 View Post
So you mean you never buy a product that was made outside of North or South America? Cause Apple is a company that makes its products in China, Taiwan, and I think Denmark. Also, do you happen to own an "American" car like a Chevy?
That was his point, he was being sarcastic as most people on MacRumors making those claims own products made - in China.
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Old Jan 4, 2013, 03:01 PM   #12
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Originally Posted by ouimetnick View Post
awww Poor Best Buy

NOT

Bunch of clueless goof balls run Best Buy. Trying to sell Monster cables and Bose junk. And their extended warrantee.

The sales reps have no idea what they are actually talking about, and considering their geek squad is run by idiots, I don't like BB.
You don't seem to have a much of a clue yourself. Don't generalize please. You dealt with all Best Buy employees. Yea there's some clueless one's, but they're not all clueless. No, I don't work for Best Buy.

I like how you call Bose "junk." Great products, just overpriced. Course most here should be used to that sorta thing
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Old Jan 5, 2013, 01:13 AM   #13
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I like how you call Bose "junk." Great products, just overpriced. Course most here should be used to that sorta thing
Yeah, same as Beats by Dr Dre. They're good headphones, but they're waaaaay more expensive than they should be. Of course, they're labeled as Monster.
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Old Jan 4, 2013, 08:52 AM   #14
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That could be an interesting way to attack a competing store.
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Old Jan 4, 2013, 08:54 AM   #15
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Old Jan 4, 2013, 08:55 AM   #16
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Wish amazon would put BB out of business already.
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Old Jan 4, 2013, 09:05 AM   #17
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Originally Posted by ECUpirate44 View Post
Wish amazon would put BB out of business already.
They won't have to, BB is bleeding cash and losing customers every month now.

The founder is trying to buy the company and go private but the board thinks BB is worth a lot more, so as BB bleeds and becomes devalued, the founder is getting the company cheaper by the month, however they can not compete with Amazon and Apple directly. I have never heard one good Geek Squad story, and I warn people not to get it.

They have become a showcase for people to look and see the products and then buy them online or somewhere else cheaper.
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Old Jan 4, 2013, 09:07 AM   #18
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They have become a showcase for people to look and see the products and then buy them online or somewhere else cheaper.
This.
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Old Jan 4, 2013, 09:25 AM   #19
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Originally Posted by Wicked1 View Post
They won't have to, BB is bleeding cash and losing customers every month now.

They have become a showcase for people to look and see the products and then buy them online or somewhere else cheaper.
I just hope they don't go out of business so I have someplace to go and play with the tech toys before I buy them somewhere else. :-)

Seriously... Best Buy has to get price competitive if they're going to survive. This sounds like sour grapes, but I am surprised Apple let Walmart do the discount. Most of the time, it's never a direct price drop, but add-on freebies for discounts with Apple products. Like get a $50 iTunes card with your iPhone purchase.
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Old Jan 4, 2013, 10:30 AM   #20
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They have become a showcase for people to look and see the products and then buy them online or somewhere else cheaper.
Exactly this. There may be some small moments where buying a product from Best Buy is an advantage to me, but most of the time I am there to grope the products in person and see if I like them, and/or compare prices.
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Old Jan 4, 2013, 12:38 PM   #21
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They won't have to, BB is bleeding cash and losing customers every month now.
Hmm, I don't see them bleeding cash...

http://www.wikinvest.com/stock/Best_...come_Statement
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Old Jan 4, 2013, 01:22 PM   #22
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Originally Posted by Wicked1 View Post
They won't have to, BB is bleeding cash and losing customers every month now.

The founder is trying to buy the company and go private but the board thinks BB is worth a lot more, so as BB bleeds and becomes devalued, the founder is getting the company cheaper by the month, however they can not compete with Amazon and Apple directly. I have never heard one good Geek Squad story, and I warn people not to get it.

They have become a showcase for people to look and see the products and then buy them online or somewhere else cheaper.
Then they should change their company name to 'Best Browse'
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Old Jan 4, 2013, 08:10 PM   #23
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They have become a showcase for people to look and see the products and then buy them online or somewhere else cheaper.
That is actually the only reason I use Best Buy now. If I or someone else I know is interested in buying something we just go into Best Buy to get a closer look at it or a little hands on time with it. Then go home and buy it online. About the only thing Best Buy is useful for now.

Yet I hate my current job so much I am currently trying to be hired as a computer sales rep there. lol. Anything to get away from my current job.
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Old Jan 4, 2013, 09:56 AM   #24
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Wish amazon would put BB out of business already.
Best Buy, where Amazon customers window shop.
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Old Jan 4, 2013, 10:07 AM   #25
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Wish amazon would put BB out of business already.
Yeah **** the people that work there
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