If you are a brand and sell through Best Buy then you have to pay to be there.
There are many ways of paying:
Products have to be supplied in a fairly 'just in time' way so you are doing the warehousing/distribution that retail chains used to fully take care of.
You have to take back unsold inventory or take back inventory if it under-performs and the range/model/SKU is dropped. So this also means that for the customer there is no 'old model deeply discounted' unless it is a store demo unit.
You have to pay for marketing. For Best Buy to promote your brand you need to pay for that.
You have to pay for what shelf your products are on. This is a bit like concessions in department stores or end of aisle shelves in a supermarket. You only get your products at eye level and prominent if you pay.
You might have to pay for Best Buy specific models. This can involve cosmetic changes to the product that mean more production costs (e.g. moulds for injection moulding, packaging).
You might have to have a team of people do in store training, visiting Best Buy stores and teaching the staff how to demo your products. This is actually really crucial.
Best Buy do provide sales data that helps forecasting demand, this is useful but in the olden days the store would take all the risk of ordering what they thought they could sell.
Despite all of the above Best Buy are great to work with for most brands. However, not all chains are. There are plenty of stories of companies that have worked with Walmart to come apart. This happens as the margin Walmart demands means that one has to nickel and dime the product to make it as cheap as possible. People buy into the brand, take it home and find it is rubbish. They take it back, don't buy the brand ever again and cost you money. Meanwhile the specialist retail channels that the brand did have stop selling the product as Walmart have started selling it for less than what they can sell it for. In this way a brand can quickly die. The trap is that if you don't sell your product at the price they want to sell it at (as a 'loss leader') then they can boot you out of the store and get your rival in instead. It is lose or lose for the brand when the retailer does this.
There are many ways of paying:
Products have to be supplied in a fairly 'just in time' way so you are doing the warehousing/distribution that retail chains used to fully take care of.
You have to take back unsold inventory or take back inventory if it under-performs and the range/model/SKU is dropped. So this also means that for the customer there is no 'old model deeply discounted' unless it is a store demo unit.
You have to pay for marketing. For Best Buy to promote your brand you need to pay for that.
You have to pay for what shelf your products are on. This is a bit like concessions in department stores or end of aisle shelves in a supermarket. You only get your products at eye level and prominent if you pay.
You might have to pay for Best Buy specific models. This can involve cosmetic changes to the product that mean more production costs (e.g. moulds for injection moulding, packaging).
You might have to have a team of people do in store training, visiting Best Buy stores and teaching the staff how to demo your products. This is actually really crucial.
Best Buy do provide sales data that helps forecasting demand, this is useful but in the olden days the store would take all the risk of ordering what they thought they could sell.
Despite all of the above Best Buy are great to work with for most brands. However, not all chains are. There are plenty of stories of companies that have worked with Walmart to come apart. This happens as the margin Walmart demands means that one has to nickel and dime the product to make it as cheap as possible. People buy into the brand, take it home and find it is rubbish. They take it back, don't buy the brand ever again and cost you money. Meanwhile the specialist retail channels that the brand did have stop selling the product as Walmart have started selling it for less than what they can sell it for. In this way a brand can quickly die. The trap is that if you don't sell your product at the price they want to sell it at (as a 'loss leader') then they can boot you out of the store and get your rival in instead. It is lose or lose for the brand when the retailer does this.