Best Buy 2012 Annual Report Download - page 4

Download and view the complete annual report

Please find page 4 of the 2012 Best Buy annual report below. You can navigate through the pages in the report by either clicking on the pages listed below, or by using the keyword search tool below to find specific information within the annual report.

Page out of 117

  • 1
  • 2
  • 3
  • 4
  • 5
  • 6
  • 7
  • 8
  • 9
  • 10
  • 11
  • 12
  • 13
  • 14
  • 15
  • 16
  • 17
  • 18
  • 19
  • 20
  • 21
  • 22
  • 23
  • 24
  • 25
  • 26
  • 27
  • 28
  • 29
  • 30
  • 31
  • 32
  • 33
  • 34
  • 35
  • 36
  • 37
  • 38
  • 39
  • 40
  • 41
  • 42
  • 43
  • 44
  • 45
  • 46
  • 47
  • 48
  • 49
  • 50
  • 51
  • 52
  • 53
  • 54
  • 55
  • 56
  • 57
  • 58
  • 59
  • 60
  • 61
  • 62
  • 63
  • 64
  • 65
  • 66
  • 67
  • 68
  • 69
  • 70
  • 71
  • 72
  • 73
  • 74
  • 75
  • 76
  • 77
  • 78
  • 79
  • 80
  • 81
  • 82
  • 83
  • 84
  • 85
  • 86
  • 87
  • 88
  • 89
  • 90
  • 91
  • 92
  • 93
  • 94
  • 95
  • 96
  • 97
  • 98
  • 99
  • 100
  • 101
  • 102
  • 103
  • 104
  • 105
  • 106
  • 107
  • 108
  • 109
  • 110
  • 111
  • 112
  • 113
  • 114
  • 115
  • 116
  • 117

4
PART I
Item 1. Business.
Unless the context otherwise requires, the use of the terms "we," "us" and "our" in this Annual Report on Form 10-K refers to
Best Buy Co., Inc. and, as applicable, its consolidated subsidiaries.
Description of Business
We are a multinational retailer of consumer electronics, computing and mobile phone products, entertainment products,
appliances and related services. We operate retail stores and call centers and conduct online retail operations under a variety of
brand names such as Best Buy (BestBuy.com, BestBuy.ca), Best Buy Mobile (BestBuyMobile.com), The Carphone Warehouse
(CarphoneWarehouse.com), Five Star, Future Shop (FutureShop.ca), Geek Squad, Magnolia Audio Video, Pacific Sales and
The Phone House (PhoneHouse.com). References to our Web site addresses do not constitute incorporation by reference of the
information contained on the Web sites.
Information About Our Segments
During fiscal 2012, we operated two reportable segments: Domestic and International. The Domestic segment is comprised of
the operations in all states, districts and territories of the U.S., operating under various brand names including, but not limited
to, Best Buy, Best Buy Mobile, Geek Squad, Magnolia Audio Video and Pacific Sales.
The International segment is comprised of: (i) all Canada operations, operating under the brand names Best Buy, Best Buy
Mobile, Cell Shop, Connect Pro, Future Shop and Geek Squad; (ii) all Europe operations, operating under the brand names The
Carphone Warehouse, The Phone House and Geek Squad; (iii) all China operations, operating under the brand name Five Star
and (iv) all Mexico operations, operating under the brand names Best Buy and Geek Squad.
Financial information about our segments is included in Item 7, Management's Discussion and Analysis of Financial Condition
and Results of Operations, and Note 14, Segment and Geographic Information, of the Notes to Consolidated Financial
Statements, included in Item 8, Financial Statements and Supplementary Data, of this Annual Report on Form 10-K.
Domestic Segment
We were incorporated in the state of Minnesota in 1966 as Sound of Music, Inc. Today, our U.S. Best Buy stores offer our
customers a wide variety of consumer electronics, computing and mobile phone products, entertainment products, appliances
and related services with variations on product assortments, staffing, promotions and store design to address specific customer
groups and local market needs.
In fiscal 2001, we acquired Magnolia Hi-Fi, Inc. — a Seattle-based, high-end retailer of audio and video products and
services — to access an upscale customer segment. Today, we operate Magnolia Home Theater store-within-a-store experiences
in certain U.S. Best Buy stores, offering customers high-end electronics with specially trained employees. In fiscal 2010, we
also began operating Magnolia Design Center store-within-a-store experiences to further enhance the unique product offerings
and high-touch customer service provided by the Magnolia brand in select U.S. Best Buy stores.
In fiscal 2003, we acquired Geek Squad Inc. Geek Squad provides repair, support and installation services. We acquired Geek
Squad to further our plans of providing technology support services to customers. Geek Squad service is available in all U.S.
Best Buy branded stores.
In fiscal 2007, we acquired California-based Pacific Sales Kitchen and Bath Centers, Inc. ("Pacific Sales"). Pacific Sales
specializes in the sale and installation of high-end and mass-market premium brand kitchen appliances, plumbing fixtures and
home entertainment products, with a focus on builders and remodelers. In fiscal 2011, we also began integrating Pacific Sales
into select U.S. Best Buy stores via our store-within-a-store experience, offering customers many of the same products and
services offered in that brand's stand-alone store format.
In fiscal 2007, we also developed the Best Buy Mobile concept through a management consulting agreement with U.K.-based
The Carphone Warehouse Group PLC ("CPW"). Best Buy Mobile provides a comprehensive assortment of mobile phones,
accessories and related services using experienced sales personnel, now in all U.S. Best Buy stores, as well as stand-alone
stores.