Best Buy May Not Survive
The following video is part of our "Motley Fool Conversations" series, in which analyst John Reeves and advisor David Meier discuss topics across the investing world.
Best Buy is currently facing some pretty big challenges, and David thinks the company may not be able to survive a "three-pronged" threat. On the selection side, the company cannot compete with online players like Amazon.com or Netflix. Amazon.com offers considerably more choices, which has put a serious dent in Best Buy's sales over the years. On the price side, Wal-Mart is using its sourcing power and is really stepping up its foray into consumer electronics by offering lots of attractive deals. And finally, Apple's stores offer much better sales and service than Best Buy stores do. Apple employees are knowledgeable, helpful, and not pushy. David doesn't think Best Buy is going to die anytime, soon. However, he doesn't see its business improving, either. There's just too much pressure coming from all sides. He thinks it's better to stick to companies like Apple on the product side than to invest in retail.
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