Best Buy 1999 Annual Report Download - page 7

FISCAL 1999 BEST BUY ANNUAL REPORT
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These continued advancements by our Inventory
team have allowed us to retire substantially all of
the Company’s debt and have helped create our
strong cash position.
Fiscal 1998’s success initiated a more aggressive
growth plan during fiscal 1999. We opened 28 new
stores and entered the New England market for
the first time with eight locations, producing the
strongest new market opening in our history.
In fiscal 1999, we introduced Concept IV, an
evolution of our successful retail strategy. The
Concept IV stores help make technology easy to
understand in this more complex digital age by
having departments grouped by lifestyle category
with more focused employee interaction.
Innovative displays featuring music, movies,
Digital Versatile Disc (DVD), computer software
and video games position us as the most customer-
friendly retailer in the consumer electronics
industry. The new format reinforces our brand
position as the destination for new technology
in a fun, informative and no-pressure shopping
environment.
I am extremely proud of the gains we have made
this past year and our continuing commitment
to achieve “Best Practices” in all of our operating
processes. We are developing the knowledge
and skills it will take to not only be the industry
leader but be among the very best in all of
specialty retailing.
FOCUS ON SHAREHOLDER VALUE
In October, we announced the adoption of the
Economic Value Added (EVA®) management
and incentive system from Stern Stewart & Co.
We believe use of EVA will continue to improve
decision-making and help us undertake invest-
ments that will maximize shareholder return. By
fostering our entrepreneurial culture and guiding
our management to think more like shareholders,
we expect to enhance the overall return on
invested capital.
We believe this system will improve Best Buy’s
ability to become a world-class organization
that delivers substantial value to our customers,
shareholders and employees. Consistent with our
focus on the creation of shareholder value, we
will begin utilizing EVA as a primary performance
measure for our senior management incentive
compensation program in fiscal 2000.
Our significantly enhanced financial position
and improved store operating model provide us
with many opportunities. We expect to increase
our store growth, introduce new digital prod-
ucts to our customers in a unique and exciting
way, invest in development of our e-commerce
business and improve our information systems
and customer service capabilities.