Best Buy to retool in China to focus on Five Star
Electronics retailer Best Buy says it plans to add 40 to 50 outlets of its Five Star chain in China and will close all nine of its Best Buy-branded stores in the country.
It also plans to concentrate U.S. growth on its smaller Best Buy Mobile chain, which concentrates primarily on wireless phones. It plans to open 150 of the smaller stores, nearly doubling its total to 325.
The retailer said late Monday the changes are part of a restructuring aimed at improving its growth in China's expanding consumer market.
Best Buy Inc. says the number of Five Star outlets in China would increase to about 210 by the end of fiscal 2012. The Minneapolis-based company says it will explore more profitable options for its Best Buy-branded outlets and plans to reopen two of them.
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In addition, Best Buy announced it would exit Turkey, where it had two stores.
In the U.S. the company plans to restructure parts of its supply-chain processes to cut costs and improve efficiency.
The electronics chain expects to take charges in the next few years totaling $225 million to $245 million to pay for the restructuring. The company expects the changes to save it $60 million to $70 million per year once they're finished in fiscal 2013.
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(Copyright 2011 by The Associated Press. All Rights Reserved.)