Best Buy Sues Ultimate

Be careful what you say out there, especially if you’re in the consumer electronics retail business. Ultimate Electronics has been advertising that they comparison shop at Best Buy and Walmart, then adjust their prices so that consumers can be sure that they are the lowest. Not so fast, according to Best Buy, which is the leader in the business. According to a suit filed in federal court, Best Buy’s prices are often lower than Ultimate’s. According to reports, Best Buy tried to reach an agreement with Ultimate through arbitration, but when Ultimate declined to cooperate, Best Buy decided to pursue redress through the courts.

I expect that this sort of problem will get worse before it gets better. Even though we’ve seen the departure of large chains in recent years — including CompUSA and Circuit City — local and regional chains are now expanding rapidly to fill the vacuum left behind. And the result is heavy competition driving saturation advertising that emphasizes lower prices. There are going to be winners and losers in this battle, and I suspect that nobody will go down without a fight. So pay close attention to the claims made by these retailers, and verify for yourself that you’re getting a good deal. There will certainly be bargains to be had as the different chains struggle to grab and hold on to market share.