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Best Buy Teams Up with Brightstar

Zacks Equity Research

Best Buy Inc. (BBY) recently entered into a contract with Brightstar Corp. – a multinational provider of varied solutions for the wireless devices – to look after the inventory of returned mobile devices.

Best Buy has been working with Brightstar since 2009 in the U.S. and the latter has provided various services to the company for its mobile device category. As per the agreement, Brightstar will manage the returned stock of mobile devices in a way to bring down the costs and improve efficiency.

Brightstar will provide various services such as looking after the receipt, sorting, triage, repairs, refurbishing as well as repackaging of mobile devices, which are returned to Best Buy using their service programs, comprising Trade-In and Buy Back, along with general returns and exchanges.

Utilizing the services provided by Brightstar, Best Buy can enhance the customer experience as the devices will be repaired and returned to customers within a given time frame.

Retailers are focusing on enhancing their reverse supply chain in order to reduce costs with an aim to improve customer experience. Best Buy’s move to partner with Brightstar, for managing the returned inventory, is in sync with most of the retailers’ opinion.

Moreover, Best Buy will take advantage of Brightstar’s distribution channels in order to resale the returned devices in the secondary market. This will publicize Best Buy products in the market and will provide exchange opportunities to the customers so that they are upgraded with latest technology and products.

Currently, we have a long-term ‘Underperform’ recommendation on the stock based on the declining sales at the company’s key categories. However, Best Buy, which competes with Wal-Mart Stores Inc. (WMT), holds a Zacks #3 Rank that translates into a short-term Hold rating.

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