Best Buy 2013 Annual Report Download - page 5

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5
In fiscal 2007, we also developed the Best Buy Mobile concept through a management consulting agreement with U.K.-based
Carphone Warehouse Group plc ("CPW"). Best Buy Mobile provides a comprehensive assortment of mobile phones,
accessories and related services using experienced sales personnel in all U.S. Best Buy stores, as well as stand-alone stores.
In fiscal 2012, we acquired mindSHIFT Technologies, Inc ("mindSHIFT"), a managed service provider for small and mid-sized
businesses, providing cloud services, data center services and professional services throughout the U.S.
International Segment
Our International segment was established in fiscal 2002 with our acquisition of Future Shop Ltd., Canada's largest consumer
electronics retailer. Since that acquisition, we have operated a dual-brand strategy in Canada by introducing the Best Buy
brand, which allows us to retain Future Shop's brand equity and attract more customers by offering a choice of distinct store
experiences.
In fiscal 2007, we acquired a 75% interest in Jiangsu Five Star Appliance Co., Ltd. ("Five Star"), one of China's largest
appliance and consumer electronics retailers. In fiscal 2009, we acquired the remaining 25% interest in Five Star.
In fiscal 2009, we acquired a 50% controlling interest in Best Buy Europe Distributions Limited ("Best Buy Europe").
Best Buy Europe is a venture with CPW, consisting of CPW's former retail and distribution business with nearly 2,400 small-
format The Carphone Warehouse and The Phone House stores, online channels, device insurance operations, and mobile and
fixed-line telecommunication services.
In fiscal 2009, we expanded our Best Buy Mobile operations to Canada by opening stand-alone stores. We now also offer the
Best Buy Mobile store-within-a-store experience in all Best Buy branded stores in Canada. Also in fiscal 2009, we opened our
first Best Buy branded store in Mexico, located in Mexico City.
In fiscal 2013 (11-month), we introduced the Best Buy Mobile concept in China, and we now offer the store-within-a-store
experience in select Five Star stores. We also introduced a small-format store in Mexico, Best Buy Express, that focuses on
high traffic, convenience purchases with a higher mix of accessory products.
In order to align our fiscal reporting periods and comply with statutory filing requirements in certain foreign jurisdictions, we
consolidate the financial results of our Europe, China and Mexico operations on a one-month lag. Consistent with such
consolidation, the financial and non-financial information presented in this Transition Report on Form 10-K relative to our
Europe, China and Mexico operations is also presented on a one-month lag.
Operations
Domestic Segment
Our Domestic segment is managed by product and service categories and channels, with separate leadership teams for each
area. These teams are responsible for determining how their products and services are marketed across our three primary
channels - online, retail stores and call centers. In addition to these teams, separate teams manage support capabilities (e.g.,
human resources and real estate management) and channel operations. Retail store operations are divided into territories and
districts based on geography and store size. District managers monitor store operations and meet regularly with store managers
to discuss performance.
Corporate management generally controls advertising, merchandise purchasing and pricing, as well as inventory policies across
all of our channels. Our retail stores have developed procedures for inventory management, transaction processing, customer
relations, store administration, product sales and services, staff training and merchandise display that are standardized within
each store brand. All stores within each store brand generally operate in the same manner under the standard procedures with a
degree of flexibility for store management to address certain local market characteristics.
International Segment
Located throughout eight European countries, The Carphone Warehouse and The Phone House stores are significantly smaller
than our Best Buy branded stores and employ sales associates that provide independent advice on the network service plan and
hardware best suited to each customer. Most phone sales require in-store registration with the network operator facilitated by
our employees, allowing the customer to leave the store with a fully active phone and a service contract. Advertising,
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