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Circuit City to officially close 155 stores

updated 09:50 am EST, Mon November 3, 2008

Circuit City Closes 155

Circuit City today confirmed a drastic step to save its retail business and says it will shutter 155 of its stores across the US as well as renegotiate its store licenses and curb its launches for new stores. The move leaves 566 stores and is said to target those locations that were unprofitable, particularly after marketing was involved. The shutdown takes effect quickly and will see closeout sales as early as November 5th.

The retailer blames both the poor economic conditions and a resulting shortage of credit for the company that prevents it from stocking as many products as it would like. Circuit City also believes the federal government owes the firm an $80 million income tax credit that hasn't yet been supplied.

The closures have been announced at the same time as CompUSA has also struggled in the marketplace and as Best Buy has continued to enjoy the largest amount of success among large-scale electronics retailers. Among other advantages, Best Buy has landed a currently exclusive third-party deal to carry iPhones and frequently carries store-specific variants of computers.



By Electronista Staff
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  1. sribe

    Fresh-Faced Recruit

    Joined: Jan 2003

    0

    interesting word choice!

    "at the same time as CompUSA has also struggled in the marketplace"

    Well, not exactly at the same time, since CompUSA ceased to exist months ago.

  1. wymer100

    Fresh-Faced Recruit

    Joined: Oct 2003

    +1

    Mismanagement...

    Circuit City is going down because the upper-level management is completely inept. Their asinine policies in running the business have run that company into the ground. For example, a year or so ago, Circuit City executives decided to fire any sales associates that made over a certain pay threshold. At the surface, the plan looks like a good cost savings move. If you think about that move for more than say 30 seconds, you realize what they've actually done is fire anyone that has any experience. What they were left with was a bunch of associates without any experience in customer service or knowledge of the products. The executives then wondered why sales were not meeting expectations.

    Fire the executives that created the mess at Circuit City and not give them a golden parachute. Apparently from me talking to the associates still left at those stores, the severance packages for the associates are tied to how well they move products in the next couple of weeks. Yep, let's pay people for how well they can sell luxury electronics during one of the worst financial crisis in 50 years from a company that's about to go bankrupt.

  1. testudo

    Forum Regular

    Joined: Aug 2001

    0

    Re: interesting word

    I don't know if I could complain about the wording. The CompUSA where I live seems to be struggling mightily. Not spending all my time watching it, but you'd be hard-pressed to find anyone who's bought from them in the last few months.

    Talk about struggling.

  1. Guest

    Fresh-Faced Recruit

    Joined: Nov 1999

    0

    Jerkit City

    as I have oft called it. Yes I agee that current and recent upper level mgmnt has totally messed up this once relatively well run business. I have worked for them in the past (many moons ago when they had a decent compensation pkg for store employees and mgmnt)and then they went off the deep end s******* their retail managers and employees with their feeble attempts to cut costs. Typical of many American business, blame the victim/employees when things go bad. What me, no no no, we in management are not to blame. We are here to save this company by messing it up even worse. Unfortunately the employees will end up suffering with job loss as well as their local communities, and these clowns in mgmnt will undobtably get nice golden parachutes if they don't turn this around and go under.

  1. snork

    Fresh-Faced Recruit

    Joined: Feb 2008

    0

    CC Sucks

    I worked seasonally for Circuit City in college in the computers dept. They're a big PITA company to work for and their commission structure made it practically impossible for a part timer to make more than minimum wage which is a complete joke. So yeah, you wonder why their associates suck? It's b/c most of them are probably only making min. wage.

    I haven't bought a thing at Circuit in probably 4 yrs...and the only reason I shopped there was b/c they were the only retailer that carried the specific model I wanted.

    It's also interesting since CC is retrofitting an old CompUSA in my in-law's town to move in (almost done). I wonder if they will actually open now or just cut their losses.

  1. Mr. Strat

    Junior Member

    Joined: Jan 2002

    0

    And the loss is????

    And what will we all miss by Circuit City following Future Shop and CompUSA into the graveyard?

  1. cvbcvb

    Fresh-Faced Recruit

    Joined: Nov 2003

    0

    List

    Here’s the list of stores closing:

    http://files.shareholder.com/downloads/CC/455547123x0x245809/2BFAC9D9-6CEF-4027-9E51-1C635F42F7A7/110308 Store Closing List.pdf

  1. testudo

    Forum Regular

    Joined: Aug 2001

    0

    Re: and the loss is???

    Competition, mostly. Now we're stuck with just Best Buy.

  1. MariM

    Fresh-Faced Recruit

    Joined: Oct 2008

    0

    Not just retail

    Looks like it isn't just retailers too! Saw that Sony is having real financial problems too and Olevia just filed for bankruptcy! No one seems to be safe...though I did see that Vizio had grew in the 3rd quarter. Weird, but good! I like American companies doing well.

  1. adam hartung

    Fresh-Faced Recruit

    Joined: Dec 2007

    0

    Jim Collins was wrong

    Does anyone remember that Circuit City, just a few years ago, was the best performing company in Jim Collins' book "Good to Great"? Obviously, Mr. Collins' approach to management is worth some reconsideration given the fall of Circuit City. It would seem a new approach to management would be worth considering. Read more at http://www.ThePhoenixPrinciple.com

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