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].

Comments     Threshold

This article is over a month old, voting and posting comments is disabled

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'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.

“Then they pop up and say ‘Hello, surprise! Give us your money or we will shut you down!' Screw them. Seriously, screw them. You can quote me on that.” -- Newegg Chief Legal Officer Lee Cheng referencing patent trolls

Copyright 2016 DailyTech LLC. - RSS Feed | Advertise | About Us | Ethics | FAQ | Terms, Conditions & Privacy Information | Kristopher Kubicki