Best Buy is Next Big Retailer To Launch A Marketplace. Here’s What we Know

Takeaways

• Best Buy is slated to launch a U.S. online marketplace later this year, with CEO Corie Barry recently sharing more details about the retailer's plans.
• The company stated that the marketplace will allow it to give customers more choice without forcing it into growing its inventory.
• Best Buy operates an online marketplace in Canada. It said it was learning from the experience.

Another online marketplace, this time from an electronics retailer, is coming soon.

Best Buy (BBY), Walmart (WMT), and other retailers are joining Amazon.com. (AMZN) in a retail space that is estimated to be worth several hundred billions dollars. The third-party US Marketplace Management was launched earlier this month and is scheduled to open this summer. Corie Barry, Best Buy’s CEO, revealed more details of the plan on its latest earnings call. She said that she believes this will attract shoppers and increase profits.

The company is making its second attempt at an American market. A previous attempt was closed nearly a ten-year-old due to issues with product overlaps and minimal revenue. A Canadian marketplace launched in 2016 has been deemed more successful.

We believe that as the trusted leaders in [consumer electronics] According to a transcription provided by AlphaSense, Barry said that we have the opportunity leverage our assets and positioning to build a differentiating digital marketplace platform. “This will allow us to offer our customers a more expansive selection and new categories,” Barry said during the call.

Barry said that the new marketplace would allow Best Buy customers to have more options without having to increase its own inventory. The company has said that sellers must go through a vetting system.

Best Buy has also discussed:

• The U.S. marketplace offers a wide variety of new items, while the Canadian marketplace is more focused on refurbished products. Barry, the company’s spokesperson, said that there is a demand for a wider range of products in Canada, which can be found on the US version. “Customers search our website looking for more products or a larger selection, but we don’t have it.”
• Executives have announced that US customers will be allowed to return items purchased on the marketplace to their local stores.
• Executives stated that the company will eventually be able offer fulfillment services to marketplace vendors. “It is still early in the process and we are pleased with the strong interest from sellers and believe it indicates a promising launch,” Barry said.
• Best Buy has partnered with enterprise marketplace company Mirakl to launch its marketplace, which operates the Canadian marketplace.

Best Buy did not share a public launch date. The company did not respond to Investopedia's request for comment in time for publication.

Best Buy shares are down 10% this week. They’re down 17% for the year.