Best Buy Deploying Micron Kiosks - Twice

Best Buy Deploying Micron Kiosks

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Best Buy will begin rolling out Micron Electronics kiosks to all of its stores this week.

The exclusive in-store shops, which will be in place systemwide by mid-Spring, will allow consumers to purchase custom-configured PCs directly from Micron via its e-commerce site, micronpc.com.

The deal mirrors last month's store-within-a-store agreement between OfficeMax and Gateway, and represents a major coup for Micron, whose PC business had focused almost exclusively on the business, education and government markets.

Best Buy will continue to offer other PC brands, including Hewlett-Packard and Compaq, in its configure-to-order kiosks. The Micron deal differs in its direct-sale method.

According to retailer and vendor, the agreement offers consumers the benefit of manufacturer-direct sales combined with the local support of the chain's 357 stores. "Consumers have expressed a desire to make purchases in many ways -- the web, mail order and traditional brick & mortar retailers," said Micron CEO Joel Kocher. "Today, the 'retail-direct' model, with a new supply chain architecture combining direct model manufacturing and distribution efficiencies with e-commerce order fulfillment, is an innovative paradigm shift for PC retailing."

Added Wade Fenn, Best Buy's executive VP for marketing, "In this quickly consolidating market, this is the next logical step for us, and we are offering consumers a choice that allows us to compete with the direct online channels."

Intel also weighed in on the news with a statement from senior VP Sean Maloney: "We are pleased that micron.pc and Best Buy are making it easier for consumers to have fast access to the newest technology."

Besides dramatically expanding Micron's market, analysts say the deal could lower its manufacturing costs by increasing factory utilization. For Best Buy, the pact provides an additional revenue stream while "enabling [it] to better manage inventory and deliver the latest technology and the greatest value to its customers," the partners said.

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