Best Buy will close two Baltimore-area stores in late October, as traditional shopping malls decline and retailers shift to online strategies.
The electronics retailer on Monday said it would close Best Buy Golden Ring, located at 8645 Pulaski Highway in Rosedale, and Best Buy Security Boulevard, located at 1701 Belmont Ave. in Baltimore, following a review of their operations as their leases neared expiration.
The two stores employ a total of 120 people, who will be able to apply for jobs at other Best Buy stores, said Best Buy spokesman Ryan Stanzel.
The closures echo a trend among national retailers that are shedding physical stores to focus on customers' preference for online shopping and to better compete with online-only retailers, most notably Amazon, said Howard Davidowitz, chairman of Davidowitz & Associates Inc., a New York City national retail consulting firm.
"The change is tremendous," Davidowitz said. "We've never had a period where the change was this dramatic."
Macy's, Sears, JC Penney and Staples all have closed hundreds of stores in recent years.
Closures at these and other large clothing retailers have contributed to the decline of shopping malls, which they often anchor. As a result, smaller retailers based at malls also may struggle to bring in customers, he said.
Gap and Abercrombie & Fitch have announced store closures, and Aeropostale filed for bankruptcy.
The market shift has crippled many of the company's one-time competitors, too, such as RadioShack and Circuit City, but Best Buy has been performing well, Davidowitz said.
During its most recently reported quarter, which ended July 30, Best Buy's revenue was relatively flat, at $8.53 billion, but its per-share earnings jumped 22 percent, from 46 cents per share to 56 cents.
Davidowitz attributed the company's success in part to its strategy of routinely evaluating stores, closing lower-performing locations and reinvesting the money in its online store, to better compete with Amazon.
"They're in a very price-sensitive business — if you want to buy a 40-inch flat screen [television], you can go into Best Buy, take a look at the one you want, then call up Amazon and maybe get it for less," Davidowitz said.
Best Buy has reinvented itself online, while setting itself apart with in-person features online-only retailers can't offer, such as its electronics repair service Geek Squad, he said.
After the two Baltimore-area stores close, Best Buy will have eight locations in the area.
"They're in a really tough business, but they are the best in class by far in their segment," Davidowitz said.
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