Future Shop shuts down, 1,500 out of work

Best Buy announced Saturday it is shutting down dozens of Future Shop stores across Canada, effective immediately, resulting in about 1,500 job losses.

[np_storybar title=”Future Shop timeline of major events” ]

  • 1982: Hassan Khosrowshahi opens first Future Shop location in Vancouver, one year after immigrating from Iran.
  • 1993: Future Shop goes public on Toronto and Vancouver stock exchanges as Canada’s largest electronics retailer. The company has 36 stores in Canada and two in the U.S., with plans to open 16 new locations within the year.
  • 1999: After a failed expansion into the U.S., Future Shop pulls out of the American market. The retailer closes its 23 locations south of the border after shuttering five others the year before.
  • 2001: U.S. retailer Best Buy purchases Future Shop in a $580-million deal. At the time, the Future Shop name is expected to disappear within three years.
  • Jan. 30, 2014: About 950 full-time employees are laid off at Best Buy and Future Shop stores across Canada as the company thins out management and combines some of its sales departments.
  • March 28, 2015 – Future Shop comes to an end. Best Buy Canada announces closure of 66 Future Shop stores, while the remaining 65 will be re-branded as Best Buy.

    Canadian Press

Of 131 Future Shop locations across the country, 66 will be shuttered for good and the remaining 65 will be turned into Best Buy outlets. That will leave Best Buy with a total of 192 locations across Canada, including 136 big box stores and 56 Best Buy Mobile stores.

Best Buy bought the iconic Canadian electronics retailer for $580 million in 2001, but has operated both brands concurrently.

The company noted in its announcement Saturday that many Future Shop and Best Buy stores are located “adjacent to each other, often in the same parking lot.”

The website will also be consolidated into Best Buy’s.

About 500 full-time and 1,000 part-time positions will be eliminated as a result of this move, but Future Shop says affected employees will receive severance and other support.

Best Buy has also promised to invest about $200 million in its stores and web properties, and to hire more staff. It did not say whether Future Shop employees would be given special consideration for those positions; a spokesperson told the National Post that “in some cases employees will be offered the opportunity to reapply.”

John Lucas/Edmonton Journal

Best Buy says the consolidation will hurt its earnings for fiscal 2016 in the range of 10¢ to 20¢ USD per share due to a temporary increase in operational expenses.

The end of Future Shop comes only months after Target Canada announced the closure of all its 133 stores after failing to win over Canadian customers since it took over most of the former Zellers locations in 2011. Big box retailers are also struggling to move more of their business online to compete against giants like Amazon, which captures the largest chunk of Canada’s $21.6-billion in e-commerce sales.

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