HIGHLIGHTS
- Microsoft announced shutting down all physical stores
- They have plans to ‘reimagine’ the physical spaces in four major locations
- Building an ‘experience centres’ rather than existing stores
Back in 2015, the software giant Microsoft has opened its flagship physical store in an obvious pursuit to follow up on Apple’s retail strength. Today, less than five years later, Microsoft announced that they will be permanently shutting down all of its physical stores around the world. This move denotes the end of a retail chapter that didn’t make much significance in its first place.
It’s also wise for Microsoft to focus on its core strengths and USP’s (Unique Selling Points) which is — software and services The Covid-19 pandemic gave a good opportunity to confront the fact about the bad decisions and throw in the towel.
Like other retailers in the market, the computing giant Microsoft has also temporarily shut down all of its stores in response to the Covid-19 pandemic. Now, Microsoft declares that they will not reopen them and will instead invest only in digital offerings to serve its customers.
Also shutting down the stores will result in a pre-tax charge of about $450 million, 5 cents per share for Microsoft’s current quarter ending on 30th June, the company said.
Currently, Microsoft plans to ‘reimagine’ the physical spaces in four major locations for future — London, NewYork, Sydney, and Redmond (Company’s HQ) — as ‘experience centres’ rather than existing stores.
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According to its website, Microsoft has built around 83 stores worldwide, including 72 stores in the U.S. and several others in abroad countries. Friday’s statement reveals what the company calls a “strategic change” for its retail business as sales increasingly switching to online.
The company did say that since they have to close all of its stores, their retail team has been working to assist customers for the transition to the new reality of online workplaces and schools. All employees will have the opportunity to continue with the company, Microsoft said.
The company has become a leader in cloud-computing, cloud-subscription software and even has a promising gaming subscription service. So, It would be much wiser to concentrate on its core strengths and not to be diverted with the short-term prospects of the physical store so murky that is not working well. At last, It is a smart decision by Microsoft to cut its losses and move on.
