retail news in context, analysis with attitude

In Minnesota, the Star Tribune has a piece about Hubert Joly, the new CEO of Best Buy, who is trying to revive the troubled company and seems to be having some success: "Sales have stabilized, expenses are down, and the stock price has more than doubled since last December."

The Joly approach, the story says, is to approach the company's problems with a level of simplicity, "a concise, simple answer that manages to convey both urgency and practical wisdom. In other words, Best Buy may have serious problems, but the solutions to fix them aren’t that complicated ... Joly’s appeal has been his Renew Blue strategy: Best Buy doesn’t necessarily need to re-invent the wheel so much as it needs the wheel to roll more smoothly. The retailer needs to devote more space in stores to higher-growth products and its website needs to convert more visitors to paying customers. The company’s distribution centers need to supply merchandise to both stores and online customers."

When asked last week at a shareholders meeting what the company was doing to be price competitive, Joly put that simplicity on display: "Our strategy to be price competitive is to be price competitive,” he said. “Just look at the name on the outside of this building: Best Buy.”

The story notes that Joly's temperament has been so effective that an some initial resistance to his pay package - $20 million in upfront cash and stock - seems to have largely evaporated.
KC's View:
I'd still resist that kind of upfront payout, but that's just me. I believe in payouts that come after you've achieved something, as opposed to before you've moved the needle.