Best Buy (NYSE: BBY) is acting nimbly in the wake of the novel coronavirus (COVID-19) outbreak. The company has shifted all its stores to enhanced curbside delivery only and home delivery, stopped all in-home installations, enhanced its remote tech support, and cutback or eliminated field staff. All that while Best Buy is experiencing unprecedented demand for home office equipment.
“The situation we’re facing as a company and as individuals is unprecedented and changing at a pace all of us are working to keep up with,” says Best Buy CEO Corie Barry. “We are making the best decisions we can with two goals in mind: protecting employees, customers and their respective families, while trying our best to serve the millions of Americans who rely on us for increasingly vital technology.”
“We are seeing a surge in demand across the country for products that people need to work or learn from home, as well as those products that allow people to refrigerate or freeze food,” continues Barry. “As we meet the demand for these necessities, we are adjusting how we operate in many ways to improve safety.”
Except where otherwise directed by state and local authorities, starting Sunday, March 22, the company shifted to enhanced curbside service only for all of its stores on an interim basis. That move will allow the company to continue to serve customers who have purchased on BestBuy.com or the Best Buy app and have requested pickup at their local store, according to the company.
In addition, if a customer was unable to place an online order and the product is in stock in the store, employees can go into the store to claim the item for the customer and sell it to them curbside.
The company informed customers that they can still order online or on the app and have their products shipped directly to their homes. Large products such as appliances will be delivered where permitted and under strict safety guidelines with everything being left by the customer’s door.
All in-home installation and repair has been temporarily suspended and will be rescheduled, and all in-home consultations are being conducted virtually.
All Best Buy employees have been told they do not have to work if they do not feel comfortable. They have also been told to stay home if they are feeling sick, knowing they will be paid. All field employees whose hours have been eliminated will be paid for two weeks at their normal wage rate based on their average hours worked over the last 10 weeks.
Best Buy Fiscal 2021 Guidance Change
While the company’s quarter-to-date sales are ahead of plan, because of the increased uncertainty related to the potential impacts of COVID-19 and resulting temporary changes in its operations, the company is withdrawing all fiscal 2021 financial guidance previously issued on February 27, 2020 for both the first quarter and full year.
Further, to bolster its cash position and maximize flexibility in this fluid environment, on March 19, 2020 , the company drew the full amount of its $1.25 billion revolving credit facility, which was undrawn as of February 1, 2020. This is in addition to the approximately $2 billion in cash and cash equivalents the company held as of March 19, 2020. Also, the company has suspended all share repurchases.
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