Circuit City is now filing for bankruptcy – and they keep closing stores.
My question is why are they doing so badly, and for so long? For years they seem to have worse and worse sales, just going in one, the one i went to was dimly lit, turned me off.
Why are they selling so poorly–and if they need to sell more, why are they closing so many stores? Dont you need stores to sell?
And who is responsible – the leadership of company, or was this disaster not anyone’s fault?
Their prices were never that good so people could always find better deals. Also I THINK their sales people worked on commission so they were more aggressive. Their stores also were not that friendly like you mentioned above about the lights. All of this I think played a part.
This is a bit of a puzzle. They appear to have billions in assets and only a couple of bucks in liabilities. I know. Just kidding
Two words… Best Buy. When BB started to expand there was a stark constrast between the two chains. I used to go to Circuit City, heck my dad still does, until Best Buy opened a few stores in my area. Their inventory was larger, their people were much more friendly and helpful, and I didn’t have the hard sell at the end to buy an extended warranty I didn’t want. If Best Buy hadn’t been so sucessful then I think Circuit City would have continued to stay afloat…
Didn’t they fire all of their higher-paid (experienced) staff?
About two years ago Circuit City decided to lower their overhead by cutting all their experienced sales staff and hiring, essentially, floor monkeys. This is widely considered to have spelled their doom, but I’m not getting that, either. It’s not as if Best Buy has technology experts roaming their floors.
So count me down as someone else who doesn’t get why there isn’t room for two big-box electronics specialists, especially as other chains, like CompUSA, have already cleared out of late.
The article linked to above mentions firing experienced staff, “Circuit City had been hurt by having stores in less-favorable locations than those of Best Buy Co., by increased competition from the likes of Wal-Mart Stores Inc. and by an earlier move to lay off higher-paid staff who were able to push more profitable sales, according to industry observers.”
It also mentions that most people bought stuff on credit cards, so the credit crunch hurt sales. And my understanding is that consumer electronics sales is a vicious low-margin business. I’ve seen many chains merge or close.
A couple of years ago, Circuit City bought all the Radio Shacks in Quebec (maybe all in Canada; I don’t know) and is operating them under the name La Source (opere par Circuit City). But they are not competing with Best Buy and look exactly like Radio Shack but fot the name. Does anyone know if they are also in bankruptcy?
This is an area where there is a lot of competition from other businesses – not just Best Buy, but other brick-and-mortar chains, and online businesses like Amazon. You have to get the mix of price/service/convenience just right, and it does seem that CC didn’t. (And having just $2.32 in liabilities, as Earl Snake-Hips Tucker pointed out, doesn’t make much much business sense: they were probably paying all their bills in advance to do that!)
I don’t know about bankruptcy, but, yes, the rest of Canada has a Circuit City-owned chain called “The Source.”
First words out of my stepson’s mouth when we visited one on a trip North: “Hey, this is a Radio Shack!”
After years of only having a circuit city nearby for those types of purchases I was very happy to have a Best Buy open up. Circuit City’s prices have never been very good and their sales training/salespeople has been overly pushy and ignorant.
I don’t get all the CC hate. I’m a pretty savvy electronics shopper and price for price they more than hold their own with Best Buy re notebooks and PCs. The floor monkeys at Best Buy are no sharper in real terms than the ones at CC.
I’m also not getting the letting go of "experienced staff " was their doom explanation. In our local CC even before the slashing it was pretty rare to find a true long term employee. In computers they’ve mainly been a roataing staff of youngish floor monkeys for over 10 years now. The longest I ever saw the same person on the floor over time was maybe 3 years.
I will admit that BB has done a MUCH more professional job with the Geek Squad brand than CC with their competing Firedog.
Yep. And in turn BestBuy owns the Canadian chain “Future Shop”.
They were Radio Shacks. I’m a bit fuzzy on the details, but the Radio Shack franchisor in Canada went under, and CC picked up all the stores. But someone else got the name. I think there are a few Radio Shacks out there in Canada owned by someone else, maybe they were owned directly and not franchised, but I could be wrong.
I worked at a CC in college for about 9 months.
If our store was any indication of how other CC’s were run, I am not at all surprised by the chapter 11.
Our store was dirty, dingy, unorganized. Our computer system we used for purchasing and inventory (DPS) was antiquated and ridiculous. This was only 2 years ago, and we didn’t even have the normal swipe-yourself types of credit/debit machines. You swiped cards on the keyboard and debit was not an option. Then a giant receipt would print out and you had to stick it in one of those old-school boxes to sign. Everything was just old, didn’t work well, and contradictory for an electronics store. And besides that, it was difficult to just buy shit there. You had to pay for your computer in the computer dept, your camera in the camera dept, etc. It was stupid - most places do what they need to do for the sale them send a customer to the registers with their merch ticket and the warehouse guys bring them their stuff to the front. So if I had someone wanting a camera and a printer, it was a gigantic pain in the ass. God forbid someone wanted an iPod, camera and computer. It’d take all damn day. And there was never any money in any of the registers (only supposed to be $50 at start, and we never had smaller bills) so you were always calling a manager. Or the ticket printer broke. Almost no sales went through without some sort of stupid issue that could have been prevented.
The management was clueless and disorganized within themselves. There was one main manager, another assistant that worked mainly in TVs, then one for tech (my department - cameras and computers). All would tell you different things and they never backed us up when we deserved it. They pandered to every ridiculous customer that was obviously and blatantly trying to rip CC off.
We never got any stock that we actually needed. We’d get 30 of the crappy Kodak cameras that no one ever bought and like 2 of the on-sale Canons or Nikons or Casios that everyone wanted. Our website prices were very often different than in-store prices and we didn’t always price match (think they changed that now). We also rarely had any computers or monitors in stock - not because we sold them all - because we never got them. We were always getting tons of random stock that wasn’t in the system and there was no where to put it. Our pricing system was horrible - our price ticket system and printer looked to be 15 years old and acted as such. And it never printed out stuff correctly - the prices were often wrong or it wouldn’t print out price changes it was supposed to and never updated itself when we got new merch.
Firedog was a joke. I remember the meeting we had for that. We had some good techs actually but management totally fucked them over. Our service plans were stupid, overpriced, and it seemed impossible to actually get your stuff fixed or the software you asked for installed due mainly to bad management. Firedog was obviously a last-ditch effort to try to compete with Best Buy.
Basically, our store was a complete clusterfuck and it’s ridiculous that a corporate store like that could have any branches that bad. I ended up getting fired sort of with the option of quitting because I wasn’t “happy” aka I didn’t lie to customers and push bullshit on them. I sold a LOT of cameras and had numerous return customers because I taught people that didn’t even know what a digital camera was hardly to use them with ease. But there is little to no markup on big ticket items like cameras and computers so I wasn’t making them enough money. Good riddance, that job blew.
Dewey Finn and myskepticsight have hit the proverbial nail on the head.
I always wondered how they stayed in business when their stores were ALWAYS in the least desirable, back alley locations; were poorly stocked and poorly managed, and subject to so much competition from big box retailers and better located and organized category retailers.
How is it that a consumer electronics store in Canada isn’t competing with Best Buy? Are they all (for now) in cities that don’t have Best Buys in them?
Most suppliers have had Circuit City on a cash-on-delivery or even cash-on-order basis for a while now. They had to pay in advance, or they wouldn’t get the stock delivered.
I don’t get it. I have had several occasions to shop at a CC near my work and a different one near my home. On every occasion I went there because it was the only place I could find that sold what I was looking for (flash drive, web cam, DVD player, can’t remember what else). They seem to be the only chain with lots of small stores, and if you don’t live or work near the downtown Big Box Future Shop or Best Buy, and you can’t drive to the suburban ones, you’re screwed.
In the interests of scientific rigor, I just checked the store locator for Best Buy and Future Shop, and found that although there are about three CCs within five minutes (walking) of my workplace, the closest Future Shop is twenty (beside the closest Best Buy). There is one CC within (long) walking distance of my home, and no Future Shops or Best Buys at all.
I’m far from the only person who works and lives near where I do. Where are all these other people getting their flash drives and web cams and dvd players? More importantly, where am I going to gt MY flash drives and web cams and dvd players if these ones close?? I am disgruntled.
Amazon, NewEgg, BHphoto, etc
I had a lot of people come in with printouts from places like these asking us to match prices. Shopping online isn’t everyone’s favorite thing to do, but it is possible if you don’t have other options.