Squeezed Between Apple And Amazon, Best Buy Posts $1.7 Billion Loss

Perhaps the only profitable section of your local Best Buy.

The era of the big box retailer is kaput. One the one hand, you’ve got online colossi like Amazon crushing brick-and-mortar retailers; on the other, you’ve got the juggernaut of Apple’s Retail Stores, showing everyone else how selling things in meatspace is done.

A couple years ago, the writing was on the wall when Circuit City went out of business. Now, it looks like it’s Best Buy’s turn. After posting a $1.7 billion quarterly loss last quarter, Best Buy is closing 50 stores and $800 million in costs.

Why couldn’t Best Buy keep up? Well, most of it has to do with the fact that people don’t want to buy from a middle-man anymore. Apple Insider also claims that lower margin devices like the iPad are squeezing Best Buy’s business model, which may be true, but it’s really Apple.com and Amazon.com that are killing Best Buy: if you’re going to be a retailer, you either need to do it online or sell your own products directly to the public. As Steve Jobs loved to point out, no one likes a middle man.

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