What are the forces moving the Minnesota economy? Adam Belz tries to identify the trends and show the connections between Minnesota and the larger U.S. and global economies. You can connect with him on Twitter: @adambelz
Best Buy CEO Hubert Joly on Tuesday renewed his call for Congress to pass the Marketplace Fairness Act, which would force online merchants to collect sales tax from customers.
“We don’t think the government should pick the winners,” he told the Economic Club of Minnesota. “We don’t think the government should subsidize Amazon and eBay.”
Asked what Best Buy’s other government affairs priorities are, he said the company has five: “Number one is e-fairness, number two is e-fairness, number three is e-fairness, number four is e-fairness and number five is e-fairness.”
Joly spoke a day after Shawn Score, the chief of U.S. retail stores for the company, stepped down after seven months in his new position. He did not mention Score’s resignation, but Matt Furman, a company spokesman, said “there’s not much more to the story.”
Shari Ballard, Best Buy’s human resources chief, will take over Score’s duties.
The change comes as Best Buy continues a turnaround program called “Renew Blue” that has been in progress for more than a year. Best Buy cut costs by $765 million last year and, in February, laid off 2,000 store managers. CEO Hubert Joly has said the restructuring would be focused on eliminating inefficiencies more than reducing workforce.
The company is coming off a difficult holiday season, the biggest sales period of the year, in which it cut prices and ate into margins to remain competitive with Amazon, Wal-Mart and other retailers. It produced weaker-than-expected results during its fourth quarter. After its stock more than tripled last year, Best Buy shares are down 36 percent so far in 2014.
Company shares were down more than 2 percent Tuesday afternoon, partly on the weakness of a new earnings outlook from H.H. Gregg.
But Joly was upbeat Tuesday, reiterating his plan for Best Buy to compete with companies like Amazon and Walmart by focusing on advice, service and convenience.
He said the electronics retailer’s stores are profitable, and 70 percent of Americans are within 15 minutes of a store.
“We are now using our stores as distribution centers,” he said. “Amazon has 60 distribution centers. We have one thousand.”
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