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Q&A: Best Buy CEO Corie Barry shares best practices for ‘safe retailing’ during the pandemic

May 18, 2020, 8:30 AM UTC

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In 48 hours in late March, Corie Barry, the new CEO of Best Buy, made a flurry of decisions that dramatically transformed the electronics retailer: On March 22, Best Buy stopped allowing shoppers inside all 1,000 of its U.S. stores. Instead, employees would run orders out to customers waiting curbside.

Barry landed the top job at the electronics chain last June by plotting a path forward for Best Buy that deftly navigated shifts in e-commerce. Now, as she approaches her first anniversary, she’s again reimagining the company’s future. After Best Buy switched to curbside pickup, sales dropped just 30% compared with the prior year’s. While this proved a much smaller hit than what other retailers suffered, Barry still had to furlough 51,000 of the company’s 125,000 employees—and take a 50% pay cut herself.

As consumers loaded up on groceries to prepare for the pandemic, they also stocked up on Best Buy fridges and freezers. Lines outside stores stretched around the block, forcing Barry to adjust the model on the fly. “At least one customer in that line tracked down my phone number to let me know people were not socially distanced in that line,” she says.

For years, Best Buy has operated on a thesis that homes will become more “connected” with technology; the coronavirus has sped up that trend. “Never has our purpose been more real,” she says. The Q&A below has been edited for length and clarity.

This is your first year as CEO, which sounds totally crazy. But set the scene a bit at the beginning of 2020—before everything changes.

I ruefully laughed with our risk and compliance team and said we had never done a tabletop exercise on having a pandemic. People don’t even remember now, but one of the earlier stressors we faced in the year was tariffs. At least 60% of our cost of goods sold flowed through China, in some way, shape, or form. So we already had been stocking up in some key areas like appliances before tariffs potentially going into place. Then there wasn’t supply—the manufacturing facilities weren’t running. So we might pick a different vendor, or try to move some inventory from a different country. Then the third phase was, oh, goodness, people are going to need some different products—demand was going to pick up in anything that would enable someone to work from home and to turn their kitchen into now, their office. Consumers were stocking up on supplies, in huge cart loads, and they needed somewhere to put all of that—fridges, freezers. We could see a world where people are also going to be stocking up on webcams and infrared thermometers, and they absolutely did.

Never has our purpose been more real. Our purpose is to enrich lives through technology, and every single one of us right now is sitting at home, working from home, learning from home, cooking at home now entertaining at home, my son will not stop gaming at home. And ultimately, most importantly, I think connecting at home and every one of those capabilities is on the back of connected technologies in our homes. It really underscores what’s been a hypothesis at Best Buy for such a long time.

Courtesy of Best Buy

Let’s go back to March 18. You reduce store hours, and then March 22, you switch completely to curbside pickup. So shoppers aren’t coming into the stores anymore. Talk about the decisions you made in those four days.

It was becoming more and more evident that our employees were very concerned for their own safety. And this was met by this really high demand window, where customers really needed what we sold. We put all that in a blender. We moved to the curbside model in literally a matter of 48 hours. And we stopped going into people’s homes to install and do repairs. We just could not look our employees, our customers in the eye and say that that was a safe experience.

It was exceptionally hard. Because no customers were actually coming in, the front of the stores, in 24 hours, were completely taped off with little squares and little bins, so that every single customer’s curbside order was staged and ready to go and physically distanced so that no employee had to get too close to another. One store, the minute a customer pulls up, they actually write down on a tablet what they need, that tablet would screencast to a TV that was inside the store, then someone would pick what showed up on the TV and run it out. I did curbside yesterday [to buy Air Pods], and door-to-door, from my office through the line back here was 11 minutes.

A lot of what you’re doing right now is experimental. How did reality meet expectations? Outside the Best Buy in Union Square in Manhattan, I’m seeing lines around the block for pickup.

We weren’t ready to move on a dime. When you saw the lines, trust me, at least one customer in that line tracked down my phone number to let me know people were not socially distanced in that line. We therefore created a technology to text people when their order was ready so they didn’t have to stand outside the store. If I were being honest, we were surprised by the level of demand for a no-feet-in-the-stores type of model. In the first few weeks, we retained 70% of our sales [year over year].

Is that sustainable? How do you see the future?

I think what we need to continue is meeting the customer where they’re willing to be met. We are going to live our lives collectively differently, which means there will be ongoing technology needs. People will likely do more healthcare at home, and that’s been expedited massively by the changes we’ve seen. Even what we’ve seen in China in early days, the amount of behavior that has permanently switched to digital first is incredibly different than it was before the pandemic. And so how people shop will change completely. If you think about just how much is going digital now, we thought it would take years for the percent of business to go digital that is now digital, and it happened in the span of months. Prior to the pandemic, 20% of our business was done online. I don’t think any of those things change as we move forward over the next few years here for retail.

Within all this, what were some of the hardest decisions you had to make?

The single hardest decision was furloughing 51,000 employees. That is just not something that you would ever contemplate or write the manual for. When we moved to the curbside model on March 22, we said we were going to continue to pay employees whether or not they were necessary in the new model, because obviously this requires just a much more skeleton crew of employees. We did that for four weeks. That’s [because] it would bridge people to when the federal stimulus program kicked in, and in many cases, that program actually would compensate them more highly than we might.

You are now, in May, reopening some of 200 of your stores by appointment only. How do you know it’s the right time to reopen?

We were named very early on an essential retailer by almost every state and municipality. But we felt like as the weeks went on, it was time to move from essential retailing into safe retailing. Clearly people need the things we sell, and in some cases, they really need us in their homes. Like if they have a broken fridge. We opened roughly another 400 [stores] on May 11th, so now we have about 600 stores open. Where you open is going to be dictated by a combination of what is the path of the virus, what are local jurisdictional regulations, and what is our employee availability. I’ll be honest, there is no perfect knowledge of when the right time is or what demand is going to be. By three o’clock on day one of reopening, I already had in my inbox feedback from our stores on what was working, what wasn’t. And some of the tweaks we’re already making.

How does the appointment model work? You’ve likened it to dating.

You can call, go online, or just walk up to a store to set your appointment. The next step is a pre-call about what to expect. We will ask you to wear a mask. When you come to the store, we will have them available. And then you’ll be paired with an associate who will literally be your concierge throughout the store. Everyone walks in a certain direction and it is marked so it’s very easy to keep social distance. Depending on the size of the store—our footprints range from 20,000 to 60,000 [square feet]—you’re probably talking somewhere between 10 and 24 [customers] in there [at a time].

Courtesy of Best Buy

The customer is getting a lot of one-on-one attention. How do you scale that with your workforce—are Geek Squad being redeployed to do these calls or what?

Everyone is chipping in. When I’m on calls with GMs, I’ll see there’ll be a Geek Squad agent who’s answering phone calls, because they might have the most knowledge about how to actually sell over the phone.

Now that some of the stores are reopening, is that an opportunity to bring some of the furloughed employees back or what needs to happen to do that?

At this point, we are not bringing any of them back. Right now. We believe we can run this model with the employees that we have. Our goal is of course, to do everything we can to bring them back. I don’t know how long that takes. I don’t know when it looks more like the model of old.

Will we ever get back to just being able to walk in a store and shop around?

Here’s what I don’t think it looks like. It doesn’t look like you use yesterday’s retail playbook to solve today’s problems. Just hypothesizing, it may be you see a lot of demand on the weekend and people are willing to come back in and shop, and you can create enough distance so your employees feel safe. But on the weekdays, it’s appointment-only, and you keep it a much more kind of constrained experience. And you always have curbside. I don’t think the playbook is ever going to look the way it looked before.

It’s one thing to make customers and employees feel safe in the store. What about your corporate employees—will they be working in the office anytime soon?

Best Buy, in our hearts, we had that old-school retail feeling—like the stores are going to be open and everyone’s going to be at work! And we knew we needed to change, but just hadn’t quite had the impetus to do it. And then literally, overnight, all of our people corporately, about 5,000 of them, are all working from home. And yet productivity on the whole was incredible.

So it will be a very staged and careful return to work plan, and our team is covering everything from, are you going to wear masks? Probably, if you’re in shared spaces. Will there be temperature checks when you walk in the building? Probably, if it’s proven to actually reduce the spread of the virus. More people will likely work from home. Flexible work arrangements will be much more regular.

A version of this article appears in the June/July 2020 issue of Fortune with the headline “Best Practices.”