Best Buy Co. has been quietly laying off employees in small groups at its Richfield headquarters over the past several months, incrementally reducing a corporate staff already hit hard by cuts.
The recent wave of cuts is spread across all departments and ranges from single digits to as many as 25, Best Buy confirmed Monday. The reductions follow 400 layoffs of corporate workers in February and another 400 workers last year.
The consumer electronics giant, which is working to eliminate hundreds of millions of dollars in expenses, has been trimming its staff on such a regular basis, usually on Tuesdays, that employees have nicknamed the day they receive layoff notices "Tornado Tuesdays" or "Termination Tuesdays," according to multiple sources within the company.
Best Buy spokeswoman Amy von Walter said the company hasn't been cutting employees every week, emphasizing that Best Buy provides a "meaningful" severance package that includes salary, health care benefits and outplacement services to support departing employees.
At one time, Best Buy employed as many as 9,000 people at its corporate campus, although in recent years the number has fallen to around 5,000. The company declined to say how many employees are working there now or what its final target for staff reductions will be.
"When we committed to reducing costs as part of our transformation efforts, we said our first priority was to identify savings in nonsalary expenses," von Walter said. "But we have also had to make some difficult decisions involving head count, which ultimately allow us to accelerate our work to transform our business."
As Best Buy wrestles with soft sales in the United States, the company has pledged to shave $700 million in costs over the next few years — part of an initiative called Renew Blue. Since the cost-cutting began, the company has eliminated about $295 million in annualized costs — but not all of that has come from job cuts.
The company credits Renew Blue, which includes cost cuts and an emphasis on customer service, for its improving stock price, which has more than doubled since December.