Best Buy is planning to evolve its operating model with a greater emphasis on smaller stores as the retailer plans to close 20 to 30 large-format stores, implement eight experiential store remodels and open approximately 10 additional outlet stores over the coming year. The retailer plans to invest $200 million in capital expenditures for both these physical store changes and routine store resets and maintenance, down from about $300 million last year.
The ongoing shift to smaller formats is in response to shoppers seeking more flexible shopping options, with greater emphasis on digital sales as well as rising real estate and labor costs. Changing consumer behavior also has led to the tech retailer to reduce its overall head count by approximately 25,000 people, or 20% of its workforce, over the past three years.
