Best Buy Lines up Retail Store Expansion

Best Buy, the largest US electronics retailer, said on Friday that it plans to open seven to 12 new stores in China this year, including the sixth outlet to be opened next month in Shanghai's Minhang district.

The expansion plan also includes its wholly-owned Jiangsu Five Star Appliance stores. We will open several hundreds of Five Star outlets between the next five to 10 years, said Bob Willett, chief executive officer, Best Buy International.

Willet said the Five Star expansion plan has been fast tracked after it purchased the balance 25 percent stake for about $185 million in February.

Prior to that, Best Buy had invested $184 million in 2006 to acquire a 75 percent stake in Five Star.

Willett said that a number of new Five Star outlets are already in the pipeline and significant investment has made to set up the IT infrastructures at Five Star.

Jiangsu province will still be the major focus for the retailer, while Best Buy brand will continue to concentrate on Shanghai before expanding into other cities.

The electronics giant currently runs five standard and one lifestyle store in Shanghai, apart from a premium store in Beijing, whereas Five Star has 170 outlets across the country.

Willett said Best Buy has "deliberately slowed down" its expansion pace in the country as consumers are becoming increasingly conscious about spending.

Best Buy posted a 23 percent drop in net earnings to $570 million for its fiscal fourth quarter ending Feb 28.

Source: CRIEnglish