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Print 73 comment(s) - last by JonnyDough.. on Nov 5 at 7:42 PM

Circuit City to close 20% of its stores by year's end.

DailyTech reported in late October that Circuit City was on the brink of closing 150 stores and slashing more jobs. Circuit City's stock price has dropped over 90% since the start of the year and this past Thursday, the company was warned that it could be booted from the New York Stock Exchange.

It appears that that closing time is finally arriving for what's left of Circuit City's nationwide chain. The Consumerist reported today that Circuit City plans to close 155 of its 711 stores nationwide.

According to sources close to the company, employees of the affected stores were told this morning about the closings. The store closings will be effective 12/31/2008 and according to at least one report, Firedog and car installation employees will likely be fired within 48 hours.

As for what will happen to the closing stores, The Consumerist provided this commentary from an insider:

A team of liquidators will be coming in and taking control of the store. They will set prices as they see fit, and price match guarantee, employee discounts, CC circulars, and the new one price guarantee are all out the window. The price you see is the price you will pay, although it ought to be at a bit of a discount. Firedog services as well as car audio installation are gone immediately. Returns and warranties have to be taken to a CC that's not closing. No new stock will be delivered, we just gotta crank away and sell off everything, and when it's sold, we hit the road.

For more information about the layoffs including a letter sent to affected Circuit City store, you can head over to The Consumerist.


Updated 11/3/2008
Circuit City today officially announced its plans to close 155 stores which are located in 55 markets across the United States. The 155 stores being closed accounted for $1.4 billion USD in sales for fiscal 2008 according to a statement released by the company.

You can view the full corporate press release here along with a full list of all 155 closing stores here [PDF].



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Hrm...
By pfroo40 on 11/2/2008 9:03:28 PM , Rating: 5
This isn't good. I work for Geek Squad in Best Buy, and while logically I should be glad they're shutting down stores, I think it's bad news for the big box electronics market. It's less competition in an already limited market and symptomatic of the problems involved with brick and mortar stores in today's market. Not all Best Buy stores (and employees) are up to the standard I hold, and likely for the same reasons the quality of CompUSA and Circuit City employees fell off; e-tailers and Wal Mart. The simple fact is that brick and mortars can't compete with the kind of pricing available online. If they tried, they'd go out of business. Unless, that is, you have the sheer buying power of Wallyworld. So what do B&M's do? Cut corners, reduce headcounts, lower hiring standards and reduce pay, effectively shooting themselves in the foot by cutting out the only thing that set them apart from an etailer and walmart... Face-to-face interactions with reasonably intelligent and qualified employees.

Best Buy isn't quite that bad yet, although I'm sure everyone has had bad interactions at some point. (and good ones, I hope). But it could easily follow CC and CompUSA down the crapper...




RE: Hrm...
By Vertigo101 on 11/2/08, Rating: -1
RE: Hrm...
By FITCamaro on 11/2/2008 10:03:16 PM , Rating: 2
You've just described every sales person and car salesman in existence.

For bigger items B&M stores will always have my business. Yes I might be able to get something cheaper online, but I don't want to have to deal with shipping if something goes wrong. And for stuff like video games, its the same price and I don't have to wait for it.

Amazon will probably get a lot of my Blu-ray business but for DVDs I want, I get them the first week they're out when they're selling them cheap.


RE: Hrm...
By Samus on 11/2/2008 10:43:46 PM , Rating: 1
Best Buy is not a bad organization. They've done a lot to support their customers, such as eliminating mail in rebates, having exclusive (often less expensive) Best Buy CD releases from many major (and smaller) artists and improved their return policy.

They're also made Geek Squad more competitive (it used to be outragous) and increased the quality of agents they send out in the field. Additionally, the car audio division labor is now more reasonable, ironically around the time Circuit City started closing stores about two years ago.

Best Buy is also becoming a global enterprise with markets all over the world, especially in China.


RE: Hrm...
By Desslok on 11/3/08, Rating: 0
RE: Hrm...
By TreeDude62 on 11/3/2008 10:20:40 AM , Rating: 3
Killing of mail in rebates isn't all that bad. If a product has a mail in rebate everywhere else, they give it instant. It can mean better out the door pricing on many things.


RE: Hrm...
By MrBlastman on 11/3/2008 10:36:33 AM , Rating: 3
I hate going there as well - and I've posted many times about the shenanigans they have pulled.

I am sad that Circuit City is under pressure. I have made two different electronics purchases this summer that I had a choice between Worst Buy and Circuit Silly - and I went with Circuit City. The employees were friendly, helpful, did not try to cram stuff down my throat and - best of all - their prices were better than Best Buy.

I say we all go shop at Circuit City for a while. It will only help us in the future by having the extra competition.


RE: Hrm...
By Mitch101 on 11/3/2008 1:36:24 PM , Rating: 3
NewEgg Eff them both.

NewEgg is no hassle for returns. Would probably take back car tires even though they don't sell them.

BestBuy combs over a return like they are trying to put you away for murder. Dude it still has some packaging foam particles stuck to it stop making me wait for 2 people to approve an exchange no less. Not even asking for money back.

CircuitCity never had to deal with a return and knowing 3 locations on the list being closed I would have to say they were poor locations. Poor pricing is their demise they just dont seem to have what I want on sale or at a decent price.

As for retail brick and morter I worked for one large chain and saw what they pay for products. There is plenty of room for them to compete with online sales if they wanted to. With brick and morter you have it today and that's what they think is a premium to not compete. Plus there are a few people who fear online purchases especially on big ticket items. Safe to say they also don't trust UPS/FedEx for thier electronics delivery.

Now if Fry's would just come to Charlotte or take a few of those CC stores.


RE: Hrm...
By JasonMick (blog) on 11/3/2008 3:05:29 PM , Rating: 3
What I find most ironic about this news is that there's a BIG new Circuit City store that opened in my area literally just several weeks ago, and now its on the list of ones that are closing.

In fact both the ones in my area are closing.

But the new one especially baffles me. You open a store and then close it a few weeks later? That seems like some pretty amazingly stupid business logic as they must be taking a huge hit closing that thing.

Circuit City = Fail

Here's hoping something better comes along, or Fry's gets expands to more locations.... anything to give me a b&m alternative to Best Buy.


RE: Hrm...
By VoodooChicken on 11/3/2008 4:43:39 PM , Rating: 2
That's just like Ultimate Electonics a few years ago. They sprang up all over the place like a yeast infection, I went to one ONCE during grand opening, and none of their prices were very competitive. I thought the whole chain had imploded and went away, but apparently they exist in other states.


RE: Hrm...
By Cypherdude1 on 11/3/2008 10:01:11 PM , Rating: 2
I'm glad they didn't close the store in S. Calif. While I hardly ever shop at CC anymore, I still want to keep that option. They're closing more stores in Calif. than any other state. Georgia is second.

BTW, my S. Calif. city now has two (2) Best Buys. There are also two (2) Home Depots, a Wal-Mart, a Target, two (2) Office Depots, two (2) Staples, Ford and Chevy dealerships, and even a Mall. Why my city has so many stores I don't know why. My city isn't that large and the stores are only about 4 miles apart. Since the economy has deteriorated, I can't see how all these stores can remain open.


RE: Hrm...
By Mitch101 on 11/4/2008 10:57:52 AM , Rating: 2
I have 2 staples and they are no lie 1.1 miles apart.

http://tinyurl.com/6gy9x3

I must have asked about a dozen times are you sure its not an OfficeMax or OfficeDepot going into the shopping plaza? Nope its another Staples. The original Staples is not closing either. Neither is ever busy.

Imagine your a Staples and your competition is Staples. LOL.

I do love the idea if one store is out I can go 1.1 miles to get it at the other. ;)


RE: Hrm...
By Cypherdude1 on 11/3/2008 10:10:29 PM , Rating: 1
While I have made many purchases from NewEgg, I don't like buying impact-sensitive items online. Do you really want to buy OEM or even retail-boxed HDD's online? HDD's are very sensitive and can be damaged if they are dropped even 1 inch. I only purchase retail-boxed HDD's. I prefer to buy them at B&M's so I can examine the packaging for the slightest damage. While I am willing to take a chance on an OEM DVD drive from NewEgg, I would never purchase an OEM HDD anywhere.

quote:
NewEgg Eff them both.

NewEgg is no hassle for returns. Would probably take back car tires even though they don't sell them.


RE: Hrm...
By Ringold on 11/4/2008 12:42:25 AM , Rating: 3
You seem to be skipping on buying some of the best items I find to buy online. :P

I've had a CPU, motherboard, and RAM DOA, but oddly enough never a problem with hard drives or DVD drives, always OEM. I don't believe HD's are nearly that sensitive when they're powered down and the heads are in the locked position.


RE: Hrm...
By GaryJohnson on 11/4/2008 5:42:38 AM , Rating: 2
If they're dropped an inch when they're powered they can be damaged, but when they're unpowered the heads are parked and they're fairly resistant to damage.


RE: Hrm...
By theapparition on 11/4/2008 7:54:20 AM , Rating: 3
Correct.
Most hard drives withstand about 80g's of shock when parked. When in packaging, more like 500g's.

BTW.......how does the OP think those HDD's get to his local store???


RE: Hrm...
By pfroo40 on 11/4/2008 12:18:08 AM , Rating: 2
You can't blame the store for trying to protect their bottom-line, especially in today's economy. To put things in perspective for you, I can tell you for a fact that Best Buy loses money on every computer sold. Particularly on sale items. Some items are higher margin, a price for convenience, but most stuff is definitely not profitable. Even if you look at the cost of the item you also have to figure in the costs inherent with the product process, i.e. the cost to have the store open (lights, rent etc), paying employees, paying to ship the product... Etailers cut out the middleman and thus have a huge pricing advantage.

As far as combing over returns... Yes, of course they do. If you worked a day in retail customer service you would know why. A large portion of the populace cares nothing for the store and will return items in any condition for any reason and often make outrageous demands while doing so. If you knew how many times I've seen customers attempt to return stuff with cracked LCD screens... You'd look too. Oh, and that item you're returning? The $50 Best Buy lost on it just by selling it becomes $100 lost by you returning it. But they do return it.

Don't get me wrong, I love NewEgg and buy almost all of my computer components from them. But unfortunately your facts are scewed about B&M stores.


RE: Hrm...
By peritusONE on 11/3/2008 3:38:32 PM , Rating: 2
quote:
1. Killing off rebates (How was that good thing??)


Are you serious? Would you rather go to Circuit City and pay $799 for a laptop OTD, then mail away for a $100 check that you'll be lucky to get in 2 months, or go to Best Buy and get the same laptop for $699 OTD with no rebate hassles?

It's Best Buy's elimination of the MIR that has made me shop there again. Whereas I used to prefer CC to BB, I now prefer BB due to their customer-oriented tactics. When I was in the market for a laptop, I easily chose BB over CC when all of CC's prices were much, much higher--due directly to their "sales" involving a MIR.


RE: Hrm...
By Cypherdude1 on 11/3/2008 9:07:32 PM , Rating: 3
I have sent away for hundreds of dollars worth of rebates and I have never been ripped off. I have gotten every single rebate I have sent away for. I live in California and we have a strong "Department of Consumer Affairs." Perhaps in other states companies are more tempted to rip off people.

However, you are right about one thing: You must cut out the UPC on the box. When you do this, you can no longer return the item to the store should it become defective. Luckily, this problem never surfaced either.
quote:
Would you rather go to Circuit City and pay $799 for a laptop OTD, then mail away for a $100 check that you'll be lucky to get in 2 months, or go to Best Buy and get the same laptop for $699 OTD with no rebate hassles?


RE: Hrm...
By qdemn7 on 11/4/2008 3:50:58 AM , Rating: 3
Horrible for killing off rebates, oh puhlease....

Rebates are a scam plain and simple. They are designed to cheat people because the marketers calculate that a large percentage of people will not send them in, others will be rejected and will not pursue the issue. So they can suck people in to buy with an unrealistically low price that only a percenatge of people will actually receive.

I would like to see all rebates other than immediate ones, banned completely.


RE: Hrm...
By Staples on 11/4/2008 9:35:10 AM , Rating: 2
Getting rid of mail in rebates and turning them into instant rebates was far the best thing they have ever done. MIR are such a scam.


RE: Hrm...
By JonnyDough on 11/4/2008 1:59:19 AM , Rating: 2
The fact that they were using rebates to rip of customers, the fact that they do profiling of their customers (they call this "market research" in business), and the fact that their salespeople are TAUGHT to target their profiled customers according to which demographic is most likely to spend money in the store, rather than offering general polite sales service to anyone means that they are indeed NOT a good company. How would you like it if you have a question and are in a hurry and they ignore you to help someone more likely to be buying a big ticket item?


RE: Hrm...
By rupaniii on 11/4/2008 10:31:17 AM , Rating: 2
Nope, you do misinterpret the intent here. They are doing the customer breakdowns as a way to HUMANIZE their customers and teach sales. The fact is that feeling out a customer involves quickly identifying who and what they are. You might hear they have kids and they look mid 40's and their husband works as a UPS Driver. It's confidential info, but i'll say that guy is their bread and butter customer,and his wife tries to keep up because she is shopping for him. Etc. It helps to identify these people. I actually have done contract work for them and their sales training blows away their competitors and they concentrate on how to treat their customers. As usual, the individual application of the learning is based on the age and enthusiasm of the salesperson you get. I do have a great appreciation for what they are striving for. But, you can't just fire everyone if they don't get it 100% in 3 weeks and keep starting over. It's called Team Building. No, not every manager is good at it. It's taken me a while to get really good at building my own teams for what I do.


RE: Hrm...
By JonnyDough on 11/5/2008 7:42:55 PM , Rating: 2
Perhaps they've put a new spin on it recently. I read an article with direct quotes from the CEO of Best Buy I think it was, etc. He sure made it sound like demographic profiling. Targeting consumers in-store by giving the most personal attention to those most likely to spend money on big-ticket items is not something I made up. I read it directly out of the horse's mouth. That is what they were doing. It is rude and unfair to certain customers. A customer is a customer. Equal treatment for each customer is only right and just, and giving preferential treatment to those you BELIEVE to have more money is bullcrap.

Let's say you go to a restaurant. Your waitress thinks you won't leave a very big tip because the two guys before you looked like you, and left a $0.50 tip even though there were several people at both of their tables. Now, because of her "market research" she ignores you, even when you persistently beg her to come over she gives preferential treatment to a nice little old lady sitting by herself. Little old ladies have always tipped her well.

This is essentially what Best Buy has done. I read a whole article in a viable magazine about how "great" they are...the article was not negative. I really don't believe I misinterpreted anything. I got what they were saying...I just took moral issue with it.


RE: Hrm...
By MatthiasF on 11/3/2008 1:47:45 AM , Rating: 2
Technology based B&M stores have yet to adapt against online stores. There is much they can do to help draw customers in, but their store managers and company executives treat them like a normal retailer.

Circuit City, CompUSA, Computer city, etc. all scared away business by using cheesy retailer tactics like organizing the store to make people walk around to find what they want or even putting related items on opposite ends for the same effect, marking up accessories or offering little signage to explain the differences in products. Sales-force training is also a problem.

Until they realize they can't use the same tactics as a clothing store, they're always going to have troubles. They need to figure out a way to not only retain they're decent employees but also they're smarter customers or they'll always be a stigma hovering over them.


RE: Hrm...
By FITCamaro on 11/3/2008 5:53:30 AM , Rating: 4
Of course accessories are going to be marked up. They have to pay the power bill, rent, and employees salary somehow. You're paying for the convenience of being able to buy it right then and there instead of waiting 3 days to get it. As far as walking around the store, I don't mine cause I always do that anyway. Even if I know what I'm getting, I always walk around the store and play with stuff.

Trust me I have my own personal beef with Best Buy as I worked there in high school and college. But overall its a good store. Does it cater towards the high end or those who actually know what they're talking about? No. But that doesn't make them a bad store. It doesn't matter where it is, I never rely on the sales staff for anything. When I buy electronics, I've already looked at all the options before I ever set foot in the store.


RE: Hrm...
By rudy on 11/3/2008 2:40:59 PM , Rating: 2
I agree the online retailers have been moving toward solving their problems, the reasons they have lost business they keep addressing. I used to goto best buy when purchasing a large item because A I could return it though with a hassle and B I could get a replacement plan. Now online retailers offer both of those. Second thing was I did not trust the item or description online to be what was pictured. Now Online retailers are much better with multiple pictures and ofen keep newer versions on the same UPC as different product pages. During this whole evolution the B&M stores have done almost nothing. They just prey on people who are scared to not knowlegdable enough to shop online. And the comment about them being knowledgable is a joke. They do know a little more about stuff then walmart but the problem is they only use that little extra knowlegde sucker you into buying something more expensive your chances of getting crap are the same in both cases one is just more malicious then the accidental way you would get it at walmart.


RE: Hrm...
By cyriene on 11/3/2008 7:52:39 AM , Rating: 2
The sales people at Microcenter were smart and helpful. One of them told me they had to read computer tech websites so they could stay current with info about overclocking and what hardware is good. Too bad I moved and there is no Microcenter around me now


RE: Hrm...
By Joz on 11/3/08, Rating: 0
RE: Hrm...
By ebakke on 11/3/2008 1:41:55 PM , Rating: 2
Good lord man, find a place to release your stress/anger.

BTW, I agree that Minnesota's Microcenter blows.


RE: Hrm...
By Joz on 11/3/2008 2:34:33 PM , Rating: 2
can't I release it with a rocker launcher, Red Faction style?


RE: Hrm...
By ExarKun333 on 11/3/2008 6:12:29 PM , Rating: 2
I live in the Twin Cities and I agree that the Microcenter here sucks; but think about this. Would you rather have good products you can get right away (if your cpu fan breaks, and you don't have as spare, do you want to have to order one from Newegg or just run to the store)? Also, I would prefer to have good products at a decent price with sub-par service vs. crappy products/prices with a great staff. Let me shop and find what I need, pay for the stuff, and get the hell out...that's all I need.


RE: Hrm...
By kkwst2 on 11/3/2008 1:35:36 PM , Rating: 2
It's almost that way by definition. Most of the sales people are young school kids. Most real "geeks" are not going to be working at a retail electronics store. When I was in college, I had summer jobs at IBM coding and testing hardware. Hopefully, most smart/knowledgeable kids are doing something along those lines. Occasionally you may find a smart but unmotivated kid (ie Chuck), but those are rare and you're not going to keep many of them for long.

If you're going to Best Buy for tech advice, then you're not a very sophisticated buyer to begin with. It's just not reasonable to expect that kids making 7 bucks an hour are going to be experts on the products or be able to give you real tech advice.

Now for car salespeople, that's a different story because they make decent money. However, I think most of them are too lazy to even learn all the differences and features of the cars. Not sure if they're just run down and ragged by their jobs or if there is too much turnover or what. When I bought my car, the part-time college kid parking cars knew far more than the salesman, who couldn't show me how to use any of the tech features. So I had the kid show me the car and I dealt directly with the manager for the sale. On my first service visit, the kid was a salesman. Hopefully the original salesman was parking cars!


RE: Hrm...
By KeypoX on 11/2/2008 10:14:49 PM , Rating: 5
dude you do know best buy is known as worse buy for a reason...

honestly i like CC. And have refused to shop at BB for a few years now! You may be higher quality than most BB employees but thats not saying much.


RE: Hrm...
By bkslopper on 11/3/2008 3:31:08 AM , Rating: 2
I agree less options is a bad thing. We used to have a CC in Omaha, but they closed down years ago. Their location was terrible, next to Nebraska Furniture Mart. It's kinda like parking your rebel base next to a death star.

B&M has its perks. Refunds and exchanges are far quicker and easier. Plus its nice having a display model for hands on testing. I once brought an xbox 360 into a Best Buy and hooked it up to a Samsung HDTV. I tested the TV using VGA, component, and HDMI on various resolutions. Then I purchased it using instore credit from a returned TV that was 10 months past the purchase date. If it wasn't for the instore credit, I might've gotten it for a few bucks cheaper online.

Since that CC closed, Best Buy has opened 2 additional stores and seems to be thriving.


RE: Hrm...
By bkslopper on 11/3/2008 3:38:58 AM , Rating: 2
I forgot to add the TV I returned did not have an extended warranty. I called the manufacturer's help center and they offered to set up a credit refund through the Best Buy store I purchased it from.

I also have to say some employees know their stuff, and have witnessed some others spew outright lies. It all comes down to the salesperson.


RE: Hrm...
By FITCamaro on 11/3/2008 12:28:23 PM , Rating: 1
quote:
It's kinda like parking your rebel base next to a death star.


Worked out pretty well for the Rebel base in A New Hope.


RE: Hrm...
By bkslopper on 11/3/2008 2:50:43 PM , Rating: 3
Yeah, but Circuit City doesn't have a Han Solo working in the home audio department.


RE: Hrm...
By Smartless on 11/3/2008 1:31:43 PM , Rating: 2
Yeah i feel for you there. Hawaii can be as bad. For my electronic needs we have Circuit City, Walmart, K-mart, Sears, Bestbuy, Costco, Office Max and Office Depot. Tack on our higher cost of living and any shipping from an internet site wants to make you fly up there and get it yourself. That term "free shipping".... except for Hawaii and Alaska. DOH!


RE: Hrm...
By MrBlastman on 11/3/2008 10:34:20 AM , Rating: 2
So uh... how much data from customers HD's have you stored to your usb drive today?

;)


RE: Hrm...
By pfroo40 on 11/3/2008 11:52:36 AM , Rating: 2
Hah, even if I wanted to, everything is remotely monitored now. Plus I sorta like my job. :)


RE: Hrm...
By Screwballl on 11/3/2008 11:58:46 AM , Rating: 2
bah i would rather deal with CC over BB anyday.... at least Circuit City hires (usually) based on experience and qualifications... Best Buy hires whoever is willing to work the cheapest regardless of experience.


RE: Hrm...
By Mathos on 11/3/2008 1:33:21 PM , Rating: 2
That can pretty much be said about most any retail store. And then 90% of the time they don't place people based on what they know, they just go, we're gonna put you here, good luck. Kinda like I'm a computer/electronics person but you know where Wally world put me? Lawn and Garden, I know jack about plants, but at least I'll tell the customer that, and help them find what they're looking for anyway.

Now I've worked at Best Buy before, and I can say they've improved some, and also gone down hill quite a bit since I worked there back in 98. Their sales people get rode on bad about pushing accessories with everything, and the sad part is they don't even get commission for it.


RE: Hrm...
By Fanon on 11/3/2008 1:42:28 PM , Rating: 2
quote:
The simple fact is that brick and mortars can't compete with the kind of pricing available online. If they tried, they'd go out of business.


I disagree. I visit a Fry's every time I'm in a city that has one. I find the prices competitive with online retailers, and they beat the hell out of Best Buy and Circuit City.

If we had a Fry's locally, I would hardly buy any of my electronic goods online.


RE: Hrm...
By Pneumothorax on 11/3/2008 3:55:22 PM , Rating: 2
The problem with Fry's is while their prices may be close to internet, their level support is only as good, if not worse than internet retailers. I don't ever recall being asked if I needed help at a Fry's. This is perfectly fine for a nerd like me, but I wouldn't recommend sending Aunt Sally to a Fry's.


RE: Hrm...
By Staples on 11/4/2008 9:31:26 AM , Rating: 2
The problem is furthered by the fact that in most states, you do not pay any sales tax on online physical purchases. I have supported sales tax on online purchases because I think it will put them and B&Ms on a more level footing. Last thing I want is all local B&Ms that offer physical electronic equiptment to go out of business.


Only 20%?
By quiksilvr on 11/2/2008 5:41:25 PM , Rating: 2
I'd figure at their shares costing less than a dollar they'd be shutting down its stores as fast as CompUSA did...




RE: Only 20%?
By Samus on 11/2/2008 5:45:03 PM , Rating: 2
yea im surprised too, they should just pull out of entire markets that aren't strategicly profitable, not just close certain stores in certain markets.

they could start by selling carmax.


RE: Only 20%?
By GaryJohnson on 11/2/2008 6:09:02 PM , Rating: 2
Carmax is tracked independently I thought.


RE: Only 20%?
By FITCamaro on 11/2/2008 10:04:27 PM , Rating: 2
Carmax sucks. If you're just buying a car they're not too bad. But you'd have to be an idiot or insanely desperate to take what they want to give you for your trade-in. And they won't negotiate.


RE: Only 20%?
By theapparition on 11/3/2008 9:54:16 AM , Rating: 2
You do know that share price doesn't really affect company performance. A cheap valuation only leaves you suceptable for a takeover, but doesn't affect any internal organization.

Looks like the stores getting hit the hardest are in CA, IL, and OH.

http://files.shareholder.com/downloads/CC/45540897...


RE: Only 20%?
By joemoedee on 11/3/2008 1:00:26 PM , Rating: 2
They're pulling out of the Atlanta market, which is pretty noteworthy.

I'm shocked that they're getting rid of my local store, the closest Best Buy is a 7 mile drive away, and this leaves two counties, ~200k people, without a electronics store.

(Plus the nearest BB typically is full of completely unhelpful employees, if they even bother to talk to you.)

I can see them getting out of the Atlanta area itself, Fry's and BrandsMart have taken a huge chunk out of their market, but not the suburbs.


RE: Only 20%?
By Ringold on 11/4/2008 12:52:18 AM , Rating: 2
If consumers expect a company to go bankrupt, they might avoid making large purchases there, for fear of not being able to get service or make returns if they go under.

Completely different industry, but I read recent estimates that if GM or Ford entered bankruptcy protection, their sales may fall 25% immediately just because people, rightly or wrongly, would assume they'd have a car with no one backing it up with service or spare parts. To jump to yet another industry, I think Cessna sales don't fall as much as some of the other guys because people figure Cessna is eternal, where as Piper may disappear any day now.

But also, a stock doesn't get 36 cents for no reason at all; it's earnings per 36-cent share is -$3.68. But you're definitely right on one thing; it looks like for a cool 60 million bucks or so, you too can be the proud owner of a failing retailer! What is that, real-estate value only? :(


RE: Only 20%?
By theapparition on 11/4/2008 7:25:57 AM , Rating: 2
You're confusing 2 separate issues.

When you go public, you sell public shares in your company at market rate (IPO). You then have no control over those shares, as they are traded publicly, with investors speculating on your company's performance.

But as a company, you only reap the benefit of the initial IPO......that's your cash, and no one can take it away. Assuming your company free falls from an initial IPO of $20/share to $.01/share (assuming you haven't spent all that money) you can always buy back your shares and take the company private again. Obviously it's a little more complex than that, but I'm sure you already know that.

I just wanted to dispel the myth that low share price does anything to affect a companies bottom line. CC's stock price could go to $.01/share forever, be delisted......and still, if they were actually profitable, never come close to claiming bankruptcy.

Sadly, it's the profitability part that doesn't look to good for them. However, all is not lost. K-Mart's financials looked pretty damn dire a decade ago, look at their turn-around.


Now I'm sad.
By bigboxes on 11/2/2008 11:08:42 PM , Rating: 2
NOT! Now if only Best Buy would suffer the same fate. :D




RE: Now I'm sad.
By yodaman34 on 11/3/2008 10:31:06 AM , Rating: 2
I don't really understand everyone's hate for Best Buy, shopped there for years and never had a problem. Our CC is near a Best Buy, its not closing though, I thought it would be on the list.


RE: Now I'm sad.
By Hiawa23 on 11/3/2008 1:34:07 PM , Rating: 3
I don't get the Best Buy hate, as I simply love the chain. Other than Walmart it's my favorite store. CC has always been my 2nd option. I have always bought my electronics at Best Buy, Cds, Car audio stuff, & the extended warranties I have bought for my electronics have always benefited me, so I have nothing at all bad to say about BestBuy. It really saddens me that CC is closing stores because of the families tied to the chain that really didn't do anything wrong in many cases, but with the economy going the way it is, seems like norm to see companies going under, which to me is not good at all esepcially for consumers. Circuit City has been in trouble for some time now, so I am not surprised by this


RE: Now I'm sad.
By Alias1431 on 11/3/2008 9:43:49 PM , Rating: 2
You, my good man, have never been to a Fry's Electronics, have you?


RE: Now I'm sad.
By bkslopper on 11/4/2008 5:39:39 AM , Rating: 2
Fry's is about as elusive as the fabled White Castle. (i.e. regional)


I am actually not that surprised at all.
By MarioJP on 11/2/2008 7:10:39 PM , Rating: 2
The way the trend is going these days is no wonder circuit city is going out of business. Thanks to Amazon and other online stores is what causing some sales to retail, due to the simple fact that you always find what you want online. I am tired of going to a store and not finding what you want. Sure some items might come close but still not matching your criteria.

With that being said retail really needs to catch up with the times especially MORE OPTIONS something that online is very good at.

Who wants to waste time and gas going to different stores to get what you looking for, especially with these high gas prices. No wonder retail is going down. However not saying retail will be gone for good just become less and less.

And I got a feeling circuit city won't be the only store. Bestbuy could be next, but for now it is safe from going bankrupt.

What might happen is circuit city might focus more online just like compUSA. Only time will tell how things will go.




By fw on 11/2/2008 7:16:22 PM , Rating: 2
The "online" CompUSA has nothing to do with the old CompUSA stores or company. The bankruptcy liquidators sold the COmpUSA name to TigerDirect.......


By othercents on 11/3/2008 12:03:21 PM , Rating: 2
quote:
no wonder circuit city is going out of business

Circuit City is not going out of business.
quote:
Thanks to Amazon and other online stores is what causing some sales to retail, due to the simple fact that you always find what you want online.

Not everyone has computers or online access to purchase stuff. Many older people like going to the store and talking face to face with someone. Then there are still others who want to see the product first, however they might leave the store and buy it online for a better price.

Online retailers have a marked advantage. Less overhead by having less employees, automated ordering system, and no retail space. However you can't see or feel the product before hand. For many high ticket items we need retail space or a way to see the product before we buy.

Other


B&M Stores Need To Adapt
By wempa on 11/3/2008 1:00:15 PM , Rating: 2
As others have mentioned, these B&M stores need to make themselves attractive to people who have the option of ordering online. I don't expect them to match the price of an online store, but they should at least try to come close. For example, if I see a big screen TV online for $1500, the B&M stores shouldn't be trying to sell it for $2000. If they dropped the price to $1600 or so, it might actually be worth it to buy it there. I use a lot of double layer DVD+R discs and they costs about DOUBLE in the B&Ms compared to online. Being able to see the product, not having to deal with shipping costs, being able to easily return something, etc .... those all have benefits. But, as many people have already said, they don't make themselves attractive like this. They hire morons, their selections don't come anywhere close to the online stores and they price everything to rip you off. Sorry, but I'll stick with online and deal with the occasional return.




RE: B&M Stores Need To Adapt
By drebo on 11/3/2008 1:42:21 PM , Rating: 2
B&M stores don't compete on price--they can't.

B&M stores compete in convinience and service (or at least they should). That $1500 TV would be impossible for a B&M store to sell at that price. Warehousing costs, etc, would drive the price up, not to mention the cost of maintaining sales people and register clerks. What they should be doing is, similar to car stereos, competing with added service...for instance, free or heavily discounted installation if you buy from them or free delivery (as most places do with appliances).

The problem is not that the costs haven't falled...it's that the stores have not started treating computers like everything else yet. A TV isn't just a TV anymore. If I were to buy a 42" flat screen from someone, I'd have no way to get it home...I don't own a large car or truck (I drive a midsize sedan). So, if a store could offer to drop it off and hang it for me, I would definitely consider that for an extra couple hundred dollars (this is what keeps me from buying a TV at Costco).

A B&M will never compete on price, and nor should that. They need to differentiate themselves by offering more value...which most don't currently do.


RE: B&M Stores Need To Adapt
By wempa on 11/4/2008 12:29:48 PM , Rating: 2
As I mentioned in my previous post, I don't expect them to match the price, but it should be competitive enough that the other benefits of buying from a B&M store make it a good deal overall. For example, a few years back I bought an LCD TV from a B&M store even though it was $200 more than I could get it online. Why ? I was able to have the box opened to examine the screen, I knew I'd be able to return it if there was any problem and I didn't have to wait 5 days to get it. In other words, give us an incentive to buy it .... and don't give me this 0% interest for 6 months crap. I pay in full anyway.


Uh oh...
By kzrssk on 11/3/2008 1:30:59 PM , Rating: 2
This doesn't sound good. I've got a four year warranty on my HDTV that's only halfway through from Circuit City. I wonder how they're going to handle that if they shut down...




RE: Uh oh...
By bkslopper on 11/3/2008 2:14:32 PM , Rating: 2
Sounds familiar to me. In 2003 I bought an HDTV from CC, got an extended warranty, and they packed up the next year, lol. I don't even bother with extended warranties after that. I figure if I'm buying insurance for an item that is essentially a toy, then my priorities are out of whack.


RE: Uh oh...
By Cypherdude1 on 11/3/2008 8:58:38 PM , Rating: 2
Well, it's simple. If they go bankrupt, CC will disappear and you'll be SOL.
quote:
This doesn't sound good. I've got a four year warranty on my HDTV that's only halfway through from Circuit City. I wonder how they're going to handle that if they shut down...


They were not booted from the NYSE
By Lifted on 11/2/2008 6:41:01 PM , Rating: 1
They simply received a warning.




By Gul Westfale on 11/2/2008 8:21:28 PM , Rating: 3
which is why the article says:

"... and this past Thursday, the company was warned that it could be booted from the New York Stock Exchange."


Shareholder
By Soulkeeper on 11/3/2008 9:11:32 PM , Rating: 2
as a shareholder of CC I was hoping they wouldn't go the way of tweeter and compUSA. I purchased a large stake early in the year, but after the stock dropped about 40% when the BB deal fell through I was forced to sale, nothing has gotten better since then.
I still hold a small stake which is down like 94% (money i can afford to lose obviously).

looks like the local store near my house isn't on the closure list, I did my part and purchased my logitech speakers and a few video games there.

Management is to blame.




By slashbinslashbash on 11/4/2008 2:11:03 AM , Rating: 2
Circuit City has just never done much for me. I would go in for the occasional hot deal on a HDD, video card, video game, or DVD, but I never found their prices competitive on any of the big-ticket items. Nor did I like the look and feel of the stores in general. I like walking around Best Buy. I don't like walking around Circuit City. The stores always feel like an older style of retailer -- Montgomery Ward's or Service Merchandise (both defunct) or the like.

What is interesting is that one of the stores they are closing here in Texas has only been open for like 2 months (across the street from a Best Buy that has been around for a couple of years, incidentally). When I saw the sign go up and learned that CC would be one of the anchors of a big new strip mall, I was left scratching my head. I bet that they still have opening-day inventory that has not been turned yet. It's just stupid for a company to have wasted money like that.




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