There’s little doubt that few in Lawrence, Kansas loom larger than businessman John Kieffer…
From humble beginnings on the wrong side of the tracks on Kansas City’s East Side, Kieffer built both an audio/video and commerical real estate empire in the Land of the Jayhawk by being in the exact right place at the exact right time. For 53 years and counting, no less.
Not to mention he’s lived to tell the story.
Kieffer’s take on the ongoing free fall of audio/video giant Best Buy, which recently ousted it’s 50-something, married CEO over a sex scandal with a 20-something woman subordinate, after days earlier announcing the closing of 50 stores, hundreds of staff layoffs and a plan to downsize its box store biz by opening 100 smaller, Best Buy Mobile stores?
"That’s not what’s happening," Kieffer says of the downsizing talk. "That’s (just) what they’re putting out. It’s a positive spin for a company that’s got a lot of problems. You know, if you’re closing stores and everybody’s talking about you…The truth of the matter is I don’t know of anybody that’s making money in the audio-video industry in the past five years. The audio-video industry is parallell to the housing industry – it’s oversaturated and overexposed – so only the direct dealers seem to be able to survive. Most smaller dealers buy through wholesalers and distributors."
In short, the world is changing, becoming more competitive and whether Best Buy can survive those changes remains in great doubt.
How tough is it at Best Buy?
So much so that interim CEO Mike Mikan released a video message to the chain’s 170,000 employees that began with him conceding that, "I know these have been difficult days at Best Buy. And like all of you, I hear about it from my friends in the community and my family members."
Best Buy had hoped to take advantage of the demise of its main competitor Circuit City three years ago, but revenue at Best Buy stores open at least a year have declined in three of the last four years.
The bottom line: in the world of electronics – kind of like newspapers and greeting cards – while industry leaders often blame things on the economy, not all businesses are destined to live forever, either in good times or bad.