Future Shop
From Wikipedia, the free encyclopedia
| Future Shop | |
|---|---|
 |
|
| Type | Division of Best Buy |
| Founded | 1982 |
| Headquarters | Burnaby, British Columbia |
| Key people | Moe Amirie, Senior Vice President, Future Shop |
| Industry | Retail |
| Products | Electronics |
| Revenue | $3.6 billion CAD (2006) |
| Employees | 14,000 |
| Parent | Best Buy Canada |
| Subsidiaries | None |
| Website | www.futureshop.ca |
| Number of stores: 131 | |
Future Shop is Canada's largest consumer electronics retailer and etailer. Best Buy Canada is a wholly-owned subsidiary of Best Buy Corporation. Future Shop currently operates a total of 131 stores across all of Canada's provinces as of December 2007.
Future Shop was purchased for over C$500 million by Best Buy on November 4, 2001. The company was renamed Best Buy Canada Ltd.—a wholly owned subsidiary of its American parent. They have continued to operate Future Shop as a separate division, with most locations under their original name. Future Shop continues to grow and open new stores across Canada. In November 2007, Future Shop opened its new flagship store in Toronto at Dundas Square.
Contents |
[edit] History
[edit] Beginnings
Future Shop was founded in 1982 by Iranian entrepreneur Hassan Khosrowshahi, who left Iran to settle in Vancouver, British Columbia, Canada to start a retail business.[1] Khosrowshahi graduated from the University of Tehran with a degree in law and economics and was a part of the family that owned the Minoo Industrial Group, a large Iran manufacturer of pharmaceuticals, cosmetics, and food products. Khosrowshahi planned to open a chain of consumer and home electronics stores and take over the Canadian retail market. His associate, Mohammad Ziabakhsh, took the role of president and CEO of the newly formed company and Khosrowshahi himself served as chairman and founder. In 1983, Future Shop opened the first three stores, all of which were in British Columbia. The company sold computers, software, games, videocassettes, audio equipment, music, among other items. By December 1983, the first month all of the Future Shop stores were opened and making business, the company reached $2.8 million dollars in sales.[1]
By 1993, Future Shop became the largest retailer of computers and consumer electronics in Canada and was operating 38 stores across the country and parts of the United States.[1] In August 1993, Future Shop went public on the Toronto Stock Exchange, making $30 million dollars to be used for expansion and to pay off debt.
[edit] Competition
In 1995, competition between Future Shop and its many rivals, including A&B Sound, caused the company to start volume purchasing. The chain would then be able to expand faster and would be able to acquire better deals on merchandise, give out lower prices to customers, and plan major further growth for new stores in the companies.
By the end of the year, Future Shop's sales had reached the $1 billion dollar sales mark. Increases were caused by major expansion within the company, with the desire for more and better locations, while sales at the chain's top locations began to slip in profits and eventually decline to the point where the stores would have to close and liquidate.[1]
In 1997, Future Shop announced a change in management, with Ziabakhsh leaving the company. Khosrowshahi took on the roles of president and CEO in addition to serving as chairman. Many people from company headquarters were fired shortly afterward.
At the end of March, Future Shop's Canadian division had produced record setting sales and earnings for the company, however, the company's earnings were down 20 percent from the previous year, due to many losses caused by its failing U.S. operations. Despite plans for more locations in the U.S. over the next several years, the company instantly stopped any new plans for further expansion in the United States until the existing U.S. stores improved their performance in sales.
[edit] Focusing on Canadian markets
In 1998, Future Shop purchased the Canadian division of Computer City from CompUSA, which was only three months after the Computer City chain had been merged into CompUSA and either converted to CompUSA or closed and liquidated. During the next year, two of the Computer City retail stores had been liquidated due to poor sales.
By the end of 1998, the U.S. locations of Future Shop were performing badly, with $53 million dollars in losses over the last few years, and Future Shop projected another $30 million in losses would occur by the end of the next year. After major losses in sales, in March 1999, the company announced that it would close U.S. operations, holding liquidation sales and closing down for good in the summer.[2] The closures left Future Shop with 81 stores across Canada. Many of the former stores ended up converting to one of its major U.S. competitors, Best Buy.
In 2000, Future Shop had owned 83 Future Shop stores and five Computer City stores. In June 2000, Future Shop announced plans to open flagship stores in downtown Vancouver, Toronto, and Montreal.
In February 2001, Future Shop announced that the company would close and liquidated the five remaining Computer City stores due to poor sales. At the same time, Future Shop also attempted to acquire Chapters, a chain of book stores in Canada, but failed to come up with a reasonable offer for Chapters.[3]
Futureshop employees are known as Product Experts (PE's) rather than Sales Associates.
[edit] Best Buy buyout
In March 2001, American-based Best Buy acquired Future Shop for $387 million. Despite possible conversions to the Best Buy nameplate, Future Shop was to be run as a separate division under the name of Best Buy Canada. The acquisition caused Khosrowshahi to step down as president. The other executives from Future Shop retained their positions within the company.
Best Buy Canada have continued to operate Future Shop as a separate division, with most locations under their original name. Future Shops are still being added, mostly recently at urban locations at Empress Walk and Dundas Square; the latter location is down the street from an existing Best Buy at Toronto Eaton Centre.
[edit] Major product categories
- Computer hardware, software and accessories
- Major appliances and small household appliances
- Stereo and portable audio equipment and accessories
- Car audio and other such electronics
- Televisions, VCRs, DVD players and other home theatre equipment
- Digital cameras and accessories, video cameras, and digital photofinishing under the name FuturePhoto
- PDAs, cellular phones and other portable electronic devices
- CDs and DVDs
- Gaming console and portable systems and games
[edit] References
- ^ a b c d Future Shop Ltd. Company History
- ^ Future Shop to Close U.S. Stores
- ^ Timeline for Chapters
