Bye Bye, Circuit City

[clj2]

http://money.cnn.com/2009/01/16/news/companies/circuit_city/?postversion=2009011612


NEW YORK (CNNMoney.com) -- Bankrupt electronics retailer Circuit City Inc. said Friday it has asked for court approval to close its remaining 567 U.S. stores and sell all its merchandise.
The company said it has 34,000 employees.
"We are extremely disappointed by this outcome," James Marcum, acting CEO for Circuit City, said in a statement. "We were unable to reach an agreement with our creditors and lenders to structure a going-concern transaction in the limited timeframe available, and so this is the only possible path for our company."
In a filing with the U.S. Bankruptcy Court for the Eastern District of Virginia, Circuit City - the No. 2 electronics retailer after Best Buy (BBY (http://money.cnn.com/quote/quote.html?symb=BBY&source=story_quote_link), Fortune 500 (http://money.cnn.com/magazines/fortune/fortune500/2008/snapshots/10034.html?source=story_f500_link)) - said it had reached an agreement with four companies to start the liquidation process.
The company said the sale would begin Saturday and run until March 31, pending court approval.
The retailer's Web site and call center will cease to operate after Jan. 18.
Circuit City said employees will receive 60 days notice of the termination.
Employees who are laid off earlier will get pay and benefits for the 60-day period beginning Friday, the retailer said.
Those who remain with the company to assist with the liquidation, will receive pay and benefits.
Circuit City also operates about 765 retail stores and dealer outlets in Canada. The company said its Canadian operations, which employ 3,000 workers, will continue to operate.
The company said it will redeem its gift cards through the liquidation sale, but the cards will have no value once the stores are closed.
"This is very significant. It shows you how bad things are for the the retail industry," said George Whalin, president and CEO of Retail Management Consultants.
Whalin said management mistakes over the past few years combined with the recession brought down Circuit City.
"This company made massive mistakes," he said, citing a decision to get rid of sales people and other mismanagement.
What's more, given the credit market freeze, Whalin added that no manufacturer wants to sell to any retailer who doesn't have money to pay for the merchandise.
At the same time, Whalin said there's still a very slim chance that one or more firms that have expressed an interest in buying Circuit City could still buy it out of bankruptcy over the next few days.
"I wouldn't say it's completely over yet for Circuit City, but it's almost over," Whalin said.
Love Goel, CEO of Growth Ventures Group, an investment banking firm focused on retailers, agreed with Whalin.
"Circuit City isn't a viable business in its old incarnation when half of electronics sales have moved online," Goel said. "CompUSA and Tweeter also didn't make it for the same reason."
However, Goel speculated that Circuit City could still find a lifeline if Golden Gate Capital, one of the reported lead bidders for the merchant, bought the company and restructured it primarily as an online business with very few physical stores.
"This would eliminate overhead costs, vendor conflicts and other issues," he said. "Circuit City has an almost $1 billion online business. So there is a future for it in that regard." http://i.cdn.turner.com/money/images/bug.gif (http://money.cnn.com/2009/01/16/news/companies/circuit_city/?postversion=2009011612#TOP)


Sad. I have a feeling that many, many more retail stores like this will have the same fate in 2009.

[catlover79]

What a shame - I really liked Circuit City, too. :(

[Seth]

Sad. I have a feeling that many, many more retail stores like this will have the same fate in 2009.

In Circuit City's case, though, the reasons behind the store's failure are at best minimally tied to the economy. The company has made a ridiculous number of managerial decisions in the last decade which at the end of the day killed it.

[HuntingtonM15]

In Circuit City's case, though, the reasons behind the store's failure are at best minimally tied to the economy. The company has made a ridiculous number of managerial decisions in the last decade which at the end of the day killed it.

I had no clue until I just took a quick look at their income statement. Wow, they have been significantly going down year by year. The economy definitely isn't the main cause of their bankruptcy.

[Mikado]

I wonder how that will affect the (former Radio Shack) Circuit City stores here in Canada :confused:

[browneyes106]

My cousin used to work for Circuit City but he lost his job a couple of years ago when the financial problems started to really hit them. Back then he said he wouldn't be surprised if Circuit City went out of business. I do feel for the people who just the jobs now.

[Seth]

I wonder how that will affect the (former Radio Shack) Circuit City stores here in Canada :confused:

According to the articles I've seen, the Canadian arm of Circuit City should remain in business with most stores still operating.

[GARFIELDKOOL]

Ironically, I was at Circuit City this evening, and they didn't look very organized. I needed some assistance, and the employees were scarce and not very helpful. I am going to miss Circuit City. I prefer them over Best Buy because their new releases are cheaper.

[TeeVeeCloset]

Sorry but this one they deserve...about a year ago, I was looking for a DVD, after practically begging to find a floor walker, she looked it up in the computer and told me they had 2....then told me she could not help me find it because the stuff is randomly placed and not in alphabetical order...I HIT THE CEILING, it was one of those days...demanded to see a manager, explained I was the customer who buys DVD's and they sell DVD's and their employee refused to help me look for it!!! The manager didn't really give me much comfort, which made the situation worse...I then said the following quote..."Within a year Circuit City will go the way of sam goody, suncoast, & tower records"......I walked out of the Paramus NJ store and never went back.......absolute true story with no embellishment!

[robyrob]

our local Circuit City closed down over two years ago, i don't even know where the next closest one is and I probably haven't been into one of their stores in 5 years.

[catlover79]

My cousin used to work for Circuit City but he lost his job a couple of years ago when the financial problems started to really hit them. Back then he said he wouldn't be surprised if Circuit City went out of business. I do feel for the people who just the jobs now.
So do I. :(

[Lee]

The Steve & Barry's chain is in the process of closing all its stores, too. The
location at the Grand Central Mall in Vienna, West Virginia, closed on
September 24th of last year.

[MrCleveland]

I believe it's a victim to Wall-Mart!

[OH Nuts!]

I had some good experiences (here and there) @ CC so I will miss them.

[JulieSomoski]

I don't know about everyone else, but when I've gone to Circuit City lately, the store's been a mess - things all over the place, no organization, and no help. You could only expect they were going out of business sooner or later. Now I'm just hoping this means some HUGE going-out-of-business sales :D

[Big C]

I can't believe all of thse stores have to suffer because some idiots in the stock market screwed everything up.

WHY DO WE HAVE TO PAY FOR THE SINS OF THESE WALL STREET MORONS?
!

[catlover79]

I can't believe all of thse stores have to suffer because some idiots in the stock market screwed everything up.

WHY DO WE HAVE TO PAY FOR THE SINS OF THESE WALL STREET MORONS?
!
I couldn't have said it better myself. :mad:

[Mikado]

Well, this is what happens when big business destroys the working class.....they wind up with no customers and its a big circle that comes back to haunt them

[Jude The Obscure]

Remember when CC tried to compete with the DVD format with DIVX players?

I can't say that I will miss CC......every time i would go to the nearest one, the salespeople were always huddled talking and never once bothered to see if you needed help.

[Scoobiedoo30]

And they opened a new Circuit City maybe 2 year's ago in 2007

[catlover79]

Remember when CC tried to compete with the DVD format with DIVX players?

I can't say that I will miss CC......every time i would go to the nearest one, the salespeople were always huddled talking and never once bothered to see if you needed help.
Well, the staff at the Circuit City near me were always very courteous and helpful whenever I needed assistance. I hope they all were able to find decent work elsewhere.

[Doodyville10019]

Circuit City was never a really good store to begin with - they didn't have the DVD selection that Best Buy has (I tend to buy an obscure movie or two sometimes), and their help really wasn't all that great, even in good times.

I DO, however, miss Tower Records - their store had the BEST selection of music and movies on the planet - I always bought my stuff there. They're now an online-only operation and I still buy stuff from them every once in a while.

[JulieSomoski]

Now that Circuit City and FYE are going out of business, Best Buy should be able to thrive - they'll be the only major entertainment/electronic chain around. No competition should mean a growth of sales for them.

[Scoobiedoo30]

here something I just throught of what happens with People that have Contract's

[TeeVeeCloset]

Well, the staff at the Circuit City near me were always very courteous and helpful whenever I needed assistance. I hope they all were able to find decent work elsewhere.

I'm sure they can all go back to their previous jobs making burgers at McDonalds....lol.....I can't believe the sympathy and misconceptions I'm reading here about Circuit City...Please read my post about 10 up from here about how a sales person and manager refused to help me find a DVD their computer showed they had in stock because I was told their inventory was too messy and out of order, this happened to me over a year ago!

[TeeVeeCloset]

Now that Circuit City and FYE are going out of business, Best Buy should be able to thrive - they'll be the only major entertainment/electronic chain around. No competition should mean a growth of sales for them.

When was it announced that FYE was going out?????

[PZelda]

When was it announced that FYE was going out?????
They were tied into Media Play, if I'm recalling this correctly. The Suncoast in one of the malls here closed in June of 2006... If people had membership cards with them, they could still use them at FYE (we had one in the mall too). However, the FYE here closed sometime in 2007 so now we have no entertainment stores... The big-box stores and Best Buy are it for entertainment.

Media Play has slowly been going bankrupt too... They closed most of their Sam Goody and Suncoast stores in '06.

[TeeVeeCloset]

They were tied into Media Play, if I'm recalling this correctly. The Suncoast in one of the malls here closed in June of 2006... If people had membership cards with them, they could still use them at FYE (we had one in the mall too). However, the FYE here closed sometime in 2007 so now we have no entertainment stores... The big-box stores and Best Buy are it for entertainment.

Media Play has slowly been going bankrupt too... They closed most of their Sam Goody and Suncoast stores in '06.

What you state may all be true but here in New Jersey (The Mall Capitol of the US) ..FYE is extremely healthy with at least 4 stores in my area within 10 miles....

[catlover79]

When was it announced that FYE was going out?????
Yeah, that's the first I've heard about it.

[catlover79]

They were tied into Media Play, if I'm recalling this correctly. The Suncoast in one of the malls here closed in June of 2006... If people had membership cards with them, they could still use them at FYE (we had one in the mall too). However, the FYE here closed sometime in 2007 so now we have no entertainment stores... The big-box stores and Best Buy are it for entertainment.

Media Play has slowly been going bankrupt too... They closed most of their Sam Goody and Suncoast stores in '06.
I miss Suncoast. I loved the one at my local mall - was shocked to go there one day and see it empty and deserted. :(

[DVDFreaker]

I miss Suncoast. I loved the one at my local mall - was shocked to go there one day and see it empty and deserted. :(

Suncoast has very overpriced movies that you can find movies for like $20-30 dollars cheaper elsewhere but however, they do have very hard to find movies that you can't find elsewhere though!

[catlover79]

Suncoast has very overpriced movies that you can find movies for like $20-30 dollars cheaper elsewhere but however, they do have very hard to find movies that you can't find elsewhere though!
That's the very reason why I liked the place - I found some very obscure titles there! :cool: :D

[DVDFreaker]

That's the very reason why I liked the place - I found some very obscure titles there! :cool: :D

Yeah me too, I never knew it went out of business though, that is a shame :(

[Sara Micelli]

I'm sure they can all go back to their previous jobs making burgers at McDonalds....lol.....I can't believe the sympathy and misconceptions I'm reading here about Circuit City...Please read my post about 10 up from here about how a sales person and manager refused to help me find a DVD their computer showed they had in stock because I was told their inventory was too messy and out of order, this happened to me over a year ago!

Not all the Circuit City stores were bad, though. Some of them were actually very good. The one near me was wonderful. The workers always knew a lot about their products, and they were just very helpful and courteous in general.

[catlover79]

Not all the Circuit City stores were bad, though. Some of them were actually very good. The one near me was wonderful. The workers always knew a lot about their products, and they were just very helpful and courteous in general.
Yes, they were the same way at the Circuit City by me. Every time I went there, the staff was very nice and helpful to me.

[TeeVeeCloset]

Not all the Circuit City stores were bad, though. Some of them were actually very good. The one near me was wonderful. The workers always knew a lot about their products, and they were just very helpful and courteous in general.

Unfortunatley "some of them were actually very good" doesn't keep you in business and constantly always telling me to buy things online doesn't keep stores open and people employed....I will never understand when you are in a store and they tell you, we don't have it but go to our website and I usually reply "that's why you will be out of a job soon", the same thing happens while watching a TV program.....before the show is even over they are encouraging you to go to their website....so turn off the TV or leave the room and go on the internet!

[TeeVeeCloset]

Yes, they were the same way at the Circuit City by me. Every time I went there, the staff was very nice and helpful to me.

I'm really not trying to be a metropolitan area snob, because people are usually more polite in places like lets say Ohio, unfortunately to make it in this business world, you need to be profitable on the coasts....here in the metro area we have 20 of every store within 50 miles.....I can actually go to 4 Best Buy stores within 10 miles of eachother, I'm not kidding!

And as for the economy, the foreclosure recession problems are mainly in the middle of the country....I can't find any foreclosures here in the metro area where the average middle of the road house still sells for $700,000!

[catlover79]

I'm really not trying to be a metropolitan area snob, because people are usually more polite in places like lets say Ohio, unfortunately to make it in this business world, you need to be profitable on the coasts....here in the metro area we have 20 of every store within 50 miles.....I can actually go to 4 Best Buy stores within 10 miles of eachother, I'm not kidding!
Well, I've never been to Jersey or NYC, so I'll take your word for it. But I do agree that opening up a large number of stores and placing them close together is stupidity!!

[Jude The Obscure]

Now that Circuit City and FYE are going out of business, Best Buy should be able to thrive - they'll be the only major entertainment/electronic chain around. No competition should mean a growth of sales for them.


FYE is too?? I didn't know that.

[Scoobiedoo30]

What does FYE stand for.

[catlover79]

What does FYE stand for.
For Your Entertainment

[Scoobiedoo30]

Oh Thanks

[catlover79]

Oh Thanks
No problem. :) Are there any FYE stores in Louisiana, Aaron?

[Scoobiedoo30]

No we do not have any For your Entertainment Store's in Louisiana

[catlover79]

No we do not have any For your Entertainment Store's in Louisiana
That's what I thought - I think it's mainly a Northern chain.

[PZelda]

I miss Suncoast. I loved the one at my local mall - was shocked to go there one day and see it empty and deserted. :(
OMG me too. One week it was there, the next week it was gone. No liquidation sale, nothing. They just literally packed up and vanished. :(

[catlover79]

OMG me too. One week it was there, the next week it was gone. No liquidation sale, nothing. They just literally packed up and vanished. :(
Yes, it was the same story here, too. I was really bummed!! :(

[platinumblondelife]

Going out of business sale, please!!!!!!!!!