updated 1/21/2009 6:14:24 PM ET 2009-01-21T23:14:24

Best Buy Co. Inc. laid out a succession plan Wednesday, saying Brian J. Dunn, its president and chief operating officer, will take over this summer as chief executive of the nation's largest consumer electronics chain.

The 48-year-old, who began working at the company as a store clerk in 1985, will succeed retiring CEO Brad Anderson, 59.

"Brian has demonstrated a rare ability to connect with people and inspire them to work together to accomplish extraordinary things," Best Buy Chairman Richard M. Schulze said in a statement. "Dunn is a product of — and a steward of — a unique culture at Best Buy that continues to drive the company's performance."

The Richfield, Minn.-based retailer said Dunn also will be named to its board of directors and stand for election at the 2010 meeting of shareholders.

The changing of the guard comes at a particularly crucial time for the chain, which last month began offering voluntary severance packages to virtually all its 4,000 corporate employees as falling sales plague retailers across the country.

The sales drop-off has been so sharp that Best Buy hasn't been able to take advantage of its largest rival's bankruptcy, although Dunn said Wednesday that Best Buy had its sights set on claiming the customers that once shopped at Circuit City Stores Inc.

"The current retail landscape around the world creates an unprecedented opportunity for us to earn the business of new customers and grow share," Dunn said during a conference call with investors. "We know we are currently up against extremely difficult economic times, but we also understand that these times through their very nature will create new opportunities for those who manage their resources well and yet stay close to the customer."

Circuit City, based in Richmond, Va., filed for Chapter 11 protection in November because of slowing sales and mounting debt and announced last week that it would liquidate its remaining stores.

Anderson, who called his forthcoming departure bittersweet, will complete his term as vice chairman after he steps down June 24 at the company's next scheduled meeting of shareholders.

"My emotions are mixed because I'm extremely excited about Brian's appointment," he said. "But at the same time, I'll naturally miss my daily interaction with our employees, our vendors, our customers and our investors."

Best Buy said it had yet to choose who will succeed Dunn as president and COO.

Stifel Nicolaus analyst David Schick told investors he was maintaining his "hold" rating on the chain. But he said Dunn likely have to cut costs to maintain Best Buy's dominance in the electronics sector and compete with Wal-Mart Stores Inc., Amazon.com Inc. and Costco Wholesale Co., which are now its chief rivals in terms of sales.

"We believe (Best Buy's) spending was one factor leading to its sector dominance and (the) eventual closure of (its) primary competitor, but the next several years will likely need more cost cuts and efficiency," he wrote in a research note published Wednesday.

Earlier this month, Best Buy narrowed its fiscal 2009 adjusted earnings forecast and said it would take about $60 million in fourth-quarter charges related to employee buyouts.

Best Buy shares fell 64 cents, or 2.4 percent, to $26.59 in afternoon trading Wednesday. The company plans to report fourth-quarter earnings results and give a fiscal 2010 profit outlook on March 26.

Copyright 2009 The Associated Press. All rights reserved. This material may not be published, broadcast, rewritten or redistributed.

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