Best Buy CEO resigns; shares fall

Brian Dunn steps down as the electronics retailer continues to lose market share to companies like Amazon. Director Mike Mikan will act as the interim CEO.

By TheStreet Staff Apr 10, 2012 10:37AM

By Alexandra Zendrian and Chris Ciaccia

 

Shares of Best Buy (BBY) rose briefly Tuesday after the company announced that its CEO has resigned, but were falling by mid-morning.

 

Best Buy CEO Brian Dunn said Tuesday he is leaving the company. Director Mike Mikan is taking over as interim CEO while the retailer searches for Dunn's replacement.


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"There were no disagreements between Mr. Dunn and the company on any matter relating to operations, financial controls, policies or procedures," a Best Buy statement said. "There was mutual agreement that it was time for new leadership to address the challenges that face the company."

 

Mikan was previously chief financial officer and executive vice president at UnitedHealth Group (UNH).

 

"I have enjoyed every one of my 28 years with this company, and I leave it today in position for a strong future. I am proud of my fellow employees and I wish them the best," Dunn said in the press release.


The company has come under pressure in recent years as rival Amazon (AMZN) has taken market share. Best Buy recently posted fourth-quarter results that missed Wall Street's revenue forecast. It also announced on March 30 that it plans to close 50 U.S. stores in 2013 in an effort to cut costs by $800 million by fiscal year 2015.


Shares of Best Buy rose 2.91% to $23.31 in early trading Tuesday. The stock has risen 20 cents, or 0.86%, year to date.

 

TheStreet Ratings gives Best Buy a C grade and hold rating.


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89Comments
Apr 10, 2012 10:55AM
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Well if they didn't try and up sell you or try and sell you unneeded parts or cables at every turn, more people may go into their stores...
Apr 10, 2012 1:28PM
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I don't understand all the people wishing Best Buy gone. Why would you want a huge company that employs thousands of people in the U.S. to close down? We shouldn't wish for more unemployment in our country, seriously. Best Buy employees are only human, and most are good people who really do try to do a good job. You are going to find rude employees anywhere you shop, not just there. Trust me, those people don't last long as employees.  Let's stop wishing a huge company gone because you couldn't return your laptop with the cracked screen a year after you bought it because you didn't get the extended warranty that you thought was worthless. Or because you got a store credit for something you bought outside of the 30 day return policy. Be grateful that you got that! Technology changes so fast, they have to have a return policy. The sense of entitlement people have is horrible, and heartless.

And as far as pricing, Best Buy now price matches any competitor, including Amazon.  So if it's cheaper on Amazon, tell them!  
Apr 10, 2012 11:55AM
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i worked at best buy for a long long time, they pushed us to sell those service plans. then when a customer shells out the money and has a problem its a pain for them to get their product fixed. they also kept jacking up prices and then cut the employee discount. that discount made a lot of us happy and want to perform better all around. not just for the pay. unhappy employees = bad customer servi ce. there are tons of things i would of done differently and made the store a much better shopping experience and still make the CEOs even richer!
Apr 10, 2012 11:34AM
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@upperdoper, I'm not sure I understand how asking if you found everything alright is disrespectful and nasty. Seems quite the opposite to me. They just want to make sure you found what you were looking for.
Apr 10, 2012 11:43AM
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Best Buy will be completely out of business within 10 years.  Brick & mortar simply doesn't work in the electronics space.  The overhead is too great.
Apr 10, 2012 12:23PM
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Instead of starting at the top, they should really start at the bottom.  From stock in stores, employees, hiring, mgmt, benefits, etc.  The one thing I do know... If you take care of the employee, the employee will take care of you, the business and the company.
Apr 10, 2012 11:50AM
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Wonder if he'll get a multi-million severance package for continuing the nosedive in performance of BestBuy.  Hope any $$$ he gets is in their stock.
Apr 10, 2012 11:39AM
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Recent updated tv docum on Best Buy on last week. Dunn was bullish and heavily praised their customer service including technical support. Guess he hasn't been in a real store recently. Things changed fast for him in one week. Maybe now he'll try to resurrect Circuit City. I heard they had great tech support too. Supported them right out of business. BB is right behind them. The writing is on the wall. Sad thing is, there's no excuse for it. Their problems weren't that tough to fix, if they used common sense to understand what is most important to their customer base. When will these idiots figure out that repeat business is BIG MONEY business and the best you can achieve.
Apr 10, 2012 12:46PM
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Bad customer service is everywhere because humans raised in the US are everywhere!!  We suck at education of the work force before they become the work force.  It is not an issue that should be continually fixed by employers but by our country.  We need to produce a better human, one that is responsible, caring and can make good choices for them selves and is not an obese mess that we all must take care of.  Why struggle and work hard for an education and a chance when you can sit on your fat a$$ and collect OPM (others people money).    If we truely want change we must force it upon our own people in the ways of eating, learning, exercising and living well.  lol.........good luck.

Apr 10, 2012 12:45PM
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Best Buy is seriously overpriced in their products and under served in their customer service and return policies!  Let's give them a decent burial!
Apr 10, 2012 11:58AM
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I think that Best Buy is a sinking ship. It's custmoer service is absoultly the worst, and most of the sales peole I've dealt with are rude and unprofessional. I think Best Buy should do 1 of 2 things... #1 Totally revamp the way their customer service is handled, and make sure employees are properly trained and disciplined when they violate policy.. AND #2 Completely re-invent their buisness. Reduce overhead by making big ticket items such as appliances display only in the stores and then ordered on as needed and shipped directly to the customer. I know how to fix their problems, but since I do not have a degree they won't ask me Nerd
Apr 10, 2012 12:35PM
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best buy is a joke way over priced. i bought a charger for a hp computer for $90 then found one online for $15.
Apr 10, 2012 1:46PM
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Actually OG14 Brian did start at the bottom - working in the stores stocking shelves then into sales... Not your typical exec for hire - it's  a pretty amazing story. A young boy whose family moved from NY to Minnesota only to have his dad take off leaving them high and dry.  An excellent athlete, he had to give up all sports to help support his mom and siblings. Brian worked nights and weekends through middle school and high school bagging groceries and stocking shelves at a local grocery store. After graduating from HS Brian put himself through college - graduated on time and then started at the bottom of BB worked his way up from there to CEO. He loves BB, sometimes it's not just about the money (although that's nice too). At this point in time, I don't think it matters who is in charge of BB today they are going to go through some tough times.
Apr 10, 2012 12:26PM
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Kind of reminds me of the Captain of the Italian cruise ship that sank.  As soon as the water pours in the first ones to bail are the rats and the captains.  I guess he had to leave while they still had some cash left to give him a huge severance bonus and a golden parachute.  A real CEO would have pulled all the stops and worked the extra days and hours to do everything in his power to save the business and the jobs that go with it instead of turning tail and running.
Apr 10, 2012 1:57PM
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As a former Best Buy employee, this saddens me; Brian Dunn was inspirational and innovative, though I disagreed with how he proposed to reorganize the company.
What really infuriates me about everyone wishing Best Buy to go out of business is that you are all the same people complaining about the job market/economy. In this day and age, we should be proud of an American born company that had stayed alive as long as Best Buy and we should be terrified of the nearly two hundred thousand people who would lost their jobs in American alone. That's not including Best Buy Canada, Mexico and overseas. We would see a blacklash/raise in price of products online. Companies like Apple and BOSE and Klipsch would pull into their own private sectors (Right now, Best Buy is the only retailer - online or not - that is fully authorized to sell full line-ups of those manufactures.)
Amazon would be forced to raise their prices due to higher demand thus higher overhead, manufactures would then decide to charge Amazon the same cost they have charged Best Buy. And whoever said that Best Buy charged 20% more obviously doesn't understand that for core products, like TV's, laptops and such - Best Buy sells the majority of that right at or below cost - they're not making any money on it. Sure, accessories are more expensive, but...
I do not work for Best Buy anymore, but I know from working at the four stores over 3 years in two states that there are amazingly intelligent, empowered and strong future leaders working in this company. You should all be ashamed for grouping them all in with the bad eggs. I can promise you, Best Buy employees REALLY strive to help customers, they almost all believe full-heartedly in their products and services and even if you did have a bad experience...give them another try.
We need Best Buy.

Apr 10, 2012 1:24PM
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I remember when Best Buy was THE place to go for electronics. Price may have been minimally higher but the employees were trained and knowledgeable and in every dept. Then they started cutting the number of employees and started hiring "kids" that they could pay minimum wage and were untrained on products, but Best Buy did not cut prices. So if the consumer is EXPECTED to know more than the employees and really shouldnt expect any customer service why not go to Walmart or Amazon and pay less but get the same results. 
Apr 10, 2012 1:34PM
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My only concern is where we will eventually get to see TVs and other large ticket items before buying them.  I purchase a lot from Amazon but enjoy going to BB for certain purchases as well.... and being able to see and touch certain items before purchasing them is important to me.  If online sales wins out, would you buy an expensive TV or stereo without seeing it, hearing it, and  trying it out first?   I hope the future provides a balance so both online and the "best in class" brick and mortar stores can survive together. 
Apr 10, 2012 2:39PM
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yup, there were no disagreements with the CEO and the company. Last week the company reports its closing some stores. The CEO decides to bail with his golden parachute and live happily ever after. Another corporate greed success story.
Apr 10, 2012 1:50PM
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CEO OF MAJOR COMPANY

 

First off, you're going to have to come up with a different name. No CEO is going to be sitting in his office posting thoughts on an MSN board, I think they have better things to do with their time so, with that said, cut the BS buddy. Secondly as much competition as there is between companies, no CEO is going to wish the demise of another company, they don't think that way, they're smarter than that, if something goes out of business they know they could be next. 

 

Now you want to talk about pissing people off. Lets talk about how spoiled and how people in this country are a bunch of babies and cry every time they're not pleased about something, what company  doesn't have to deal with that. There isn't a company out there that doesn't have complaints, people are complaining everywhere I go.  

 

And as far as the lie you were supposedly told, maybe it was just a misinformed employee or maybe the employee didn't have the knowledge to give you the correct information or maybe you just didn't understand their policy about something and wanted to blame BB because you weren't happy about something. BB's store policies are very clearly posted for you to read, it's your job to understand them when making a purchase or do you need your hand held everywhere you go? Mistakes happen, that's life, but when it happens today people like you tell the world how bad a company is instead of just excepting this is not a perfect world, people are spoiled brats, lets keep complaining until every company in this country is out of business.  

Apr 10, 2012 2:52PM
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Bestbuy has lost what made it great.(style, hip factor, pricing, selection) unless they get it back, they are doomed.
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