Life is just a monotonous symphony without any risks. Success follows only the risk takers who believe in their vision. Today’s billionaires were once just common people struggling to survive. This is the story of one such significant man who changed the way of selling and shopping, the founder of Best Buy – Richard M. Schulze.
Born in Saint Paul, Minnesota, Schulze spent his earlier days in the Central High School. Due to some problems he soon had to drop out of the school. Richard later earned an honorary degree from the University of St. Thomas. He then joined U.S. Air Force at the Minnesota Air National Guard. He further changed his line of work and started working as an electronics salesman.
First Risk
Schulze, while working as electronic salesman, thought of starting something of his own in the electronics industry. He decided to start an audio equipment store called Sound of Music in Saint Paul. Schulze opened this store in 1966 with the money he acquired by mortgaging his home. The business witnessed a massive growth in a small time and was soon expanded to nine stores.
The company launched its first massive sale after one of its store was hit by a tornado. The sale’s instant success brought one another major change in the business. The name Sound of Music was changed to Best Buy and the company shifted to superstore model immediately on an 18,000 sq. ft. area. The superstore offered products at everyday low prices, special discounts which attracted massive attention of people. The introduction of VCR technology profited Best Buy and the company started forty new stores across the whole U.S. in 1989.
From the very first year the company saw huge financial success with $160,000 worth sales. Schulze’s long term vision helped him take crucial decisions which would take the company to greater heights. This decisions included expanding the sales from just stereo equipment, changing the business model, etc. Although they had very less experience selling appliances the company’s business model helped them achieve the massive $9.5 million sales in 1982, the same year when the company acquired the name Best Buy.
Bumpy Rides
The company was in huge success as they touched $240 million sales in 1987 and had become the number one rival of other stores like Highland Superstores. Schulze’s first major loss hit the company hard. The company witnessed 60% decrease in their profits despite of massive revenue being generated. The loss was huge and made the company think of some solution to recover it. This is when creativity worked its magic as the company came up with an idea called “Concept II” which also was considered to be the most innovative idea ever used.
The ‘Concept II’ idea became a massive hit among the customers too and garnered the company a whopping $1.5 billion revenue mark. This huge success of Best Buy came as a hurricane for the other competitors like Highland superstores. The increased sales of Best Buy and drastic losses of Highland superstores led the latter one to shut down their business due to lack of sales. Schulze’s company was in limelight from then and they went on to expand their stores in every city of the US. The company successfully started 95 new stores across the whole US during the period 1996-97. And at the end of 1997 the company had secured $7 billion in revenue.
The company gained so much popularity by 2003 that every store’s every shelf was equipped with almost every electronic device. This included smartphones, washing machines, music players, etc. of every brand.
Richard’s journey so far, has made him a billionaire. Starting from a small town in US to spreading his business worldwide Best Buy has become the largest electronics supermarket in the world. In the current time the company owns more than 1,150 stores all across the world and has crossed more than $50 billion revenue. Success has followed Richard every time he took a daring and risky decision. Their expansion strategy has made them a top superstore company in the world.
Harshal Pawar is an avid reader, a TV show addict, and a writer. He has a personal blog brainwork.wordpress.com where he jots down his articles and poetry about love and life.
He is currently pursuing film-making and wishes to bring the words written on a paper to the screen. More of all he is a scorpio.