Originally founded in 1966 under the name Sound of Music by Richard Schulze and Gary Smoliak. Located in Saint Paul, Minnesota, the store focused on specialty audio equipment.
By 1969, the company had 3 locations and was listed on the NASDAQ. There were 9 locations by 1978.
In 1981, the Roseville, Minnesota location, which at the time the largest and most profitable Sound of Music store, was hit by a tornado. The store’s roof was sheared off and showroom destroyed, but the storeroom was untouched. In response, Schulze decided to have a “Tornado Sale” of damaged and excess stock. The sale was held in the damaged store’s parking lot. He poured the remainder of his marketing budget into advertising the sale, promising “best buys” on everything. The company made more money during that four-day sale than it did in a typical month.
So, in 1983, the company’s name was changed to Best Buy and the first superstore was opened in Burnsville, Minnesota. With annual revenue in the $10 million dollar range, the company decided to expand into home appliances and “new” electronics, such as VCR’s.
In 1985, the company went public on the NYSE under the ticker symbol: BBY. The company expanded quickly in the US during the late 80s and 90s. In 1992, the company reached $1 billion in sales.
In 2003, there were 600 Best Buy stores nationwide and the company began to expand internationally.
In 2012, the company was on the verge of bankruptcy, losing sales to online giant Amazon, until new CEO Hubert Joly introduced a price match guarantee. This turned the company around since many consumers were happy to not only receive the same price as what was offered on Amazon, but they could take their product home the same day.
In early 2014, the company settled for $4.55 million in a class action lawsuit filed against them in April 2010 by consumers who claimed Best Buy was making unsolicited phone calls in contravention of the Telephone Consumer Protection Act.