History
Best Buy Inc was founded in 1966 as an audio speciality store called Sound of Music by Richard M. Schulze and his business partner James Wheeler. The company changed names in 1983 when the company opened its latest store which would be the first expanded store selling a wide range of products at discounted pricing. The company also began selling appliances at this time and videocassette records.  Best Buy Inc is an aggressive company and set out to become one of the country's best providers of consumer electronics from the beginning.


Introduction 
As a top company in the Specialty Retailers industry, Best Buy specializes in retailing technology and entertainment products and services.  It also operates in Puerto Rico, Europe, Mexico, Canada and China making them have over 1,150 stores worldwide.  Headquartered in Minnesota, Best Buy controls a portfolio of retail stores and websites under 11 brand names:

• Best Buy or BBfB 
• Five Star Appliances - the fourth-largest appliance and consumer electronics retailer in China and sells similar products to Best Buy. 
• Future Shop -  a Canada-based retailer that sells similar products as Best Buy.
• Geek Squad
• Magnolia Audio Video
• The Carphone Warehouse - Europe’s leading independent retailer of mobile phones and services. 
• Best Buy Mobile
• Audiovisions - a U.S.-based commercial and residential video/audio systems integration firm. 
• Napster 
• Pacific Sales – offers kitchen, bath and home improvement products in Southern California.
• Speakeasy - a U.S.-based provider of broadband, voice, data and information technology services.

In the U.S., Best Buy is the largest consumer electronics retailer. 

Best Buy Mission Statement:

"Our formula is simple: we’re a growth company focused on better solving the unmet needs of our customers—and we rely on our employees to solve those puzzles. Thanks for stopping. "

Store Information

Best Buy Store 1137

Location:  Howell, NJ 

General Manager / Contact: Michael Rubino 

                         Phone number: 732-363-5269

How does Best Buy use Information Systems to increase sales: 

Marketing

•  Best Buy takes advantage of the internet with BestBuy.com which is one of the largest online electronics retail store.

Link to website: 

www.bestbuy.com

• You can also visit the Facebook page which will update you on special events and exclusive offers.

Link to Facebook page:

Howell Best Buy Facebook

• Mobile Apps 

Reward Zone Program

- Frequent shoppers card that essentially gives the customer free best buy money.

Benefits:

1. 1 point per every $1 spent in a best buy store or on bestbuy.com 
2. $5 reward certificate per every 250 points.
3. Exclusive access to special events.
4. special member only offers.
5. FREE Membership!

Branded Payments

• Best Buy Credit Card
• Reward Zone Master Card

This makes for a better experience for customers.  

Database Proccessing

Database / key / Relations

• Credit Cards(Account Number)
• Reward Zone Program(Member #)
• Sales (Order Number)
• Payroll (employee ID)
• etc.

Primary Key

Digit member id

Forms

• Credit Card Application

• Rewards enrollment form

Queries

• Check all order of a customer

• Show job positions available in state of New Jersey

Reports

Enterprise Systems

Customer Relationship Management (CRM)

• CCM - Each customers information will be stored here when they sign up to be a Rewards Zone Member, sign up for a branded payment, or use and type of Geek Squad Services. 
• ties together 3 different systems: Customer Service, Marketing, and Sales.
• with CCM, you are able to access anything dealing with our customers such as:
•  member ID number
• personal information
• purchases from and Best Buy in store or online
• returns / exchanges made

• RSS - Tracks all product inventory.  Let's us know the availability, how many, and current price. 
• constantly being updated
• allows you to see what any other stores have available

• OMS - Allows are customer to still get their product even if the current store that they are in does not have it available. 
• Fulfills the customers needs
• Put product(s) on reserve at other store - allows for easy and quick pick-up
• Track orders to see when it will be in

• Software
• Niku 6
• Niku Corporation is the leading provider of Services Relationship Management (SRM) software.
• Best Buy has chosen Niku 6’s features and functionality to upgrade its information systems (IS) infrastructure. 
• Niku 6’s ability to integrate to Oracle Financials, better project forecasting capabilities, increased finance tracking capability, and ability to manage external staffing.

To learn more about Best Buy's decision with NIKU... 

"BEST BUY SELECTS NIKU 6 FOR INFORMATION SYSTEMS INFRASTRUCTURE UPGRADE"

by Kurt Peters

 

• Hardware
• IBM -    Provides Best Buy with its registers and scanners

Porter's Five Forces

Bargaining Power of Customers: Low because customers who purchase from Best Buy generally don't purchases 10 of the same product at a time. Products purchased at Best Buy are a smaller percentage of one's income, unlike purchasing a house or a car. Consumers do not control what products get produced and at one price.

Threat of Substitutions: Few substitutions because it depends on the product the consumer wants to purchase. Best Buy can be the best option for some products but for others, some people may find it cheaper to purchase from Amazon or eBay.

Bargaining Power of Suppliers: High because they only purchase from major manufacturers such as Sony, Toshiba, Samsung, LG, Panasonic, etc. Best Buy has no other choice but to purchase from these manufacturers.

Threats of New Entrants: Low even though there is a potential pool of entrants that is large because there is numerous online electronic retailers.

Rivalry: HIGH. Walmart is one of Best Buy's biggest rivalries because they also do price matches. Walmart is already known to have the lowest prices but if they don't, they will give you the difference on a gift card. Best Buy just lowers the price of the product and that is what you pay. Customers who want to purchase more advanced electronics or who are still unsure of what specific product they want might want to go to Best Buy because their team of experts may be more knowledgeable than the workers at Walmart.


Strategy & Focus
Industry-wide focused differentiation.

Switching Costs
Medium-High.
Depending on the customer, switching costs can range from medium to high. If a customer knows what they want, they can really purchase it anywhere because they don't need someone who is knowledgeable about the product. They can even order on websites such as Amazon.com.
Some things that Best Buy offers that keep their customers loyal and happy are: Blackjack protection, Rewards Zone card, Best Buy credit card, online shopping, and ordering online with in-store pick up.

Type of Information System

Best Buy is a company which uses an Inter-enterprise Information System.

Causes:

• There are two or more independent organization: that are working with the same information: This is not just because Best Buy works in many different countries, also it is because Best Buy works with many other retail stores. 
• There is a Mandatory training: Like in any other corporation, there is a basic training for all new employees, and also there is constant trainings to current employees.
• The Solutions to problems require cooperation: If there is an issue with an specific product that arrive to a costumer, and that product was acquired in retailer store, should be a communication between the retailer store ans Best Buy to solve the customer’s problem.

Departmental Applications:

This are different departments that are working at Best Buy and those who may be a silos’ information problem, and cause a duplicated information at the same time. 

• Sales and Marketing: Customer management, Sales forecasting, Product and branch management, etc.
• Operations: Order management, Inventory, etc.
• Customer Service: Order tracking, Account tracking,Customer support, etc.
• Human Resources: Payroll, Planning, Management, etc.
• Accounting: Financial reporting, Budgets, Accounts management, etc.

Business Process Re-engineering:

Best Buy like any other company has a CRM system, like we mention above with the Rewards Zone Program. All of those benefits, has to have a data base where all the information about the client and the kind of rewards are been manage.

Best Buy not just implement CRM system, it also implement ERP, where CRM it is included too. Here are integrated Human Resources management, Sales management, Customer support, etc.

Challenges of Implementing a New Enterprise Systems:

• Collaborative management
• Requirement gaps
• Transition problems
• Employee resistance

Sources of System Costs:
Hardware-Registers, Printers and computers
Software- The software they use for these hardware (Registers, Printers and computers)
Data- Inventory management, Ordering
Procedures- Maintenance and sales
People- Labor costs, initial employee training and Geek Squad

Operating Systems:
Macintosh
Windows