Value Chain Analysis of Best Buy 

Best Buy Co. Inc. is a retail consumer electronics manufacturing American multinational company. James Wheeler and Richard M. Schulze founded the consumer electronic company in 1966. Today, we’ll discuss the value chain analysis of Best Buy; primary and supporting activities in the process of value chain analysis Example Company. They are inbound and outbound logistics, operations, marketing, and customer service; infrastructure, HRM, technology, and procurement as an application of the value chain analysis process.

Substitutes of Best Buy

• Staples, 
• Target
• Costco
• Home Depot
• Amazon
• Lowe’s,
• eBay
• Office Depot, 
• Walmart

The Value chain analysis of Best Buy would analyze the primary and supporting activities in the process of value chain analysis. They’re inbound and outbound logistics, operations, marketing, and services; infrastructure, HRM, technology, and procurement. Here’s Best Buy value chain analysis company example as follows;

Value Chain Analysis of Best Buy

Let’s discuss the primary and supporting activities involved in the process of value chain analysis of Best Buy. It is an application of value chain analysis based on Porter’s model; some of the key elements and components of value chain analysis are as follows;

Primary Activities of Best Buy 

Some of the five main primary activities in the value chain analysis of Best Buy are as follows;

Inbound Logistics of Best Buy

I-Large Supplier Network

Best Buy has established a very large network of suppliers’ partners comprising of roundabout 190 factories in various countries across the world. They help the company in the production and manufacturing of private-label products and goods. The worldwide network of supply chain partners and factories allows the company to diversify the risk factor.

II-Supplier Code of Conduct

Best Buy has developed a responsible supply chain program. It makes sure that its suppliers’ partners treat its workers fairly and create a safe workplace environment for laborers and employees. The objective of a responsible supply chain business alliance is to improve the working conditions of the supply chain.

III-Auditing Suppliers

Before partnering up with any of the suppliers, Best Buy performs an in-depth audit via 3rd party to analyze critical risk factors like forced labor or human trafficking. Some of the key factors that indicate forced labor are as follows;

• No direct payment to the workers
• Charging recruitment fee
• Withholding travel documents

Outbound Logistics of Best Buy

I-Distribution Centers

In order to increase the efficiency of e-commerce stores and deliveries; Best Buy is shifting its focus on the development of automated distribution centers. It allows the company to deliver approximately 62% of the customer online orders directly from the distribution centers. It reduces the additional warehousing and distribution costs.

II-Transportation Partners

Best Buy has partnered up with various carriers and transporters to deliver finished goods from the production and manufacturing factories to the distribution centers, warehouses, and end consumers. It helps the company to smoothly perform its outbound logistical operations and functions.

Operations of Best Buy

I-Inventory & Warehousing

Inventory and warehousing play a critical role in conducting the smooth and flexible functions of the retail chain brand. In order to achieve inventory and warehousing flexibility, Best Buy has employed approximately over 195 robots and 150,000 bins in its distribution centers. The new automation system helps the company to pack 20,000 packages within an hour. It has allowed the company to achieve speed and efficiency.

II-Integrating Operations

In order to smoothly perform various retail operations of the consumer electronics brand; Best Buy integrated people, processes, hardware, and software. It helped the company to decrease costs, better customer service, and improve lead time, order accuracy, speed, flexibility, and efficiency.

Marketing & Sales of Best Buy

I-Multiple Media Channels

Best Buy employs various media channels and advertisement campaigns for the promotion of its consumer electronics products and brand name. Along with traditional and digital marketing campaigns, Best Buy employs sponsorships, loyalty programs, and in-store sales promotional campaigns to attract and retain the attention of customers.

II-In-house Brands

Best Buy offers products and goods under multiple in-house brand names; as follows;

• Rocketfish Mobile
• Rocketfish
• Platinum
• Pacific Sales
• Modal
• Magnolia Home Theater
• Magnolia Design Center
• Insignia
• Init
• Dynex

Services of Best Buy

I-After-Sale-Service

Best Buy offers after-sale services like repair and maintenance in order to earn the trust and confidence of customers. The after-sale service helps the company to take responsibility for its products and fix the problems. As a result, it improves the customer satisfaction level of the retail chain consumer electronics brand.

Supporting Activities of Best Buy 

Some of the main supporting activities in the value chain analysis of Best Buy are as follows;

Infrastructure of Best Buy

Best Buy has established a strong corporate infrastructure along with a supply chain, manufacturing partners, warehouse and inventory system, and digital automation technology infrastructure. The system approach and on-ground infrastructure helps the retail chain brand to smoothly perform its operations and functions.

HRM of Best Buy

Best Buy has a very large database of employees comprising of roundabout 90,000 employees and workers to manage its global retail operations. The human resource department of the company plays a key role in building a safe and diverse workplace environment for all workers regardless of their background. The company strongly believes in equal opportunity, innovation, women empowerment, and diversity.

Some of the awards Best Buy has won over the years are as follows;

• America’s Best Employer for Diversity – 2021, 2020
• Best Workplace for Innovators – Top 100 Companies
• Best Places to Work for Diversity and Inclusion – 2019, 2020, 2021

Technological Development of Best Buy

Best Buy invested a significant amount of capital resources on technological development like building an e-commerce platform, automation technology, robots, bins, analytical tools, integrated technology, and others. It has allowed the company to smoothly perform its operations and keep up with growing industry trends and technological development.

Procurement of Best Buy

Best Buy follows the responsible purchasing policy and it comprises no exploitation of workers, no forced labor, and no human trafficking. The responsible purchasing policy helps the company engage in moral and ethical practices and strategies.

Conclusion: Best Buy Value Chain Analysis Example Company| Application of Value Chain Analysis Process 

After an in-depth study of the value chain analysis of Best Buy; we have realized that Best Buy is the world’s leading retail chain consumer electronics brand. If you are learning about the Best Buy value chain analysis example company; then you should keep in mind the abovementioned primary and supporting activities. They’re inbound and outbound logistics; operations, marketing and sales, and services; infrastructure, procurement, HRM, and technological development as an application of the value chain analysis process.