Circuit City files for Chapter 11 bankruptcy
By Tim Conneally | Published November 10, 2008, 9:44 AM
Just last week, the US' second largest CE retailer announced it will close 155 stores and lay off around 17% of its employees in further attempts to lower operating costs. This morning, the second shoe officially dropped.
Since last week's announcement, Circuit City has said that vendor concerns about its liquidity and ability to pay for its purchases have "escalated considerably."
Behind the scenes, the company has been reorganizing its support structure to fit with its new smaller base of 566 stores. This reorganization involved laying off 700 more employees on Friday from administrative and corporate-headquartered positions. These reductions brought the total layoffs to 20%.
Today, perhaps in light of the fact that the Christmas decorations are coming out at the chain's remaining stores, interim CEO James Marcum said, "We know there is never a good time for individuals to be impacted by decisions like these, and we deeply regret the effect this has on our associates. I want to thank them for their continued loyalty and dedicated effort as we go forward with the belief that implementing long-term and lasting change to our business will come by satisfying our customers, one at a time."
Existing stores will reportedly remain open during the holiday season on a $1.1 billion loan from the retailer's existing lenders.
my lab partner in school just got a tech job at Circuit city.........
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I never liked Circuit City.
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I say good riddance! When I first went there it was staffed with some intelligent people. The last time I was there no one knew ANYTHING! This includes how to operate their own teller machines.
I can't comment on how good or bad fire dog was but it can't be any worse than those tools in the geek squad (of which I've heard many horror stories).
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the sharks are circling the Circuit City stores.
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Note to Circuit City:
Don't use the word "fire" or "dog" when picking a name for your "professional" home installation team.
What a bunch of wankers.
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What's wrong Hollywood_, mad that Prop. 8 passed?
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Wow still doing the attacks I see. Keep hoping that you'll grow up some day but that appears to be just a dream.
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Let him have his fun. I was hoping proposition 9 would pass, then I could finally marry an animal. I've had my eye on this goat for a while now.
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Financially Short Circuited City.
It difficult to understand how they went broke, when they filled the shelves with crap from china for pennies on the dollar and sold them with at least a 300% markup.
Maybe the executive bonus's and golden parachutes is bankrupting the business.
Heck if they didn't file for chapter 11, nobody would get any bonus's this year. At least now they will.
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"Existing stores will reportedly remain open during the holiday season on a $1.1 billion loan from the retailer's existing lenders."
Super! With the great experience with all those fantastic Made in China products I am not worried at all about being able to return lemons...
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Yeah, uh are there any stores that don't sell Made in China products?
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well said
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Not quite following the point I guess...
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Good riddance to bad rubbish. Sucks for the workforce but they should have bailed out a long time ago.
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why bail, when you can collect for 26 weeks and not have to try to find a job in a bad economy. Unless you like part of the 96% of the employees who worked so little hours, UC comp will only paid for a weekly bus ride!
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We can debate the layoff of "their most experienced people", but we can also debate exactly what difference that makes!
This is far overblown!
The majority of people who shop at CC do not need an expert in anything! They are buying commodity consumer electronics that do not require any kind of expert!
And this preoccupartion with FireDog is hilarious! Yup, it certainly takes a genius to run virus scan for $100, or a genius to update an OS, or an expert to install anti-virus or Ad-Aware or to run a scan! Yup, clicking two buttons is sure kompleekated!
And I need an expert to try to find a CD or DVD in their limited product offerings. And I need an expert to pick out overpriced RAM, or to select a TV when the experts simply quote specs from a marketing brochure.
How are they supposed to compete with Geek Squad? That group of fools? Gee, I don't know! But I would select a group with just a LITTLE higher standards than the absurd lowest common denominator Geek Squad at BB!
Neither store hires IT professionals, and neither has, nor had, anything close to what I would consider an expert IT staff! If you are going to either store to become edumakated about computers, you are in the WRONG PLACE! But I find it instructive (and very scary!) that many here think that this is what they are...
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"The majority of people who shop at CC do not need an expert in anything! They are buying commodity consumer electronics that do not require any kind of expert!"
It certainly depends on the average price/quality of goods you are selling.
But then if CC is anything like PC World in the UK, the customers are people who either know what they're doing vaguely or they're people who don't know their arse from their elbow.
It's the same with the staff. Idiots asking idiots != sales.
Idiots asking people who know at least vaguely what they're doing usually does.
It's the thick employees who undoubtedly need axing.
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Well what you said is pretty much true but it would be sad for circuit city to go completely under.
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The era where PCs are exotic and require specialty stores is nearing an end.
For all practical purposes, PCs are becoming commoditis, as are many of the peripherals. They are becoming commoditized appliances just like the PS series and the XBox series. And you don't need dedicated stores for these.
And as such they are simply becoming an additional isle at your larger discount stores like WalMart.
Sure there is a market for category killer online stores like NewEgg, but large dedicated brick and mortars with exhorbitant overhead that rely primarily on walk-in business are dinosaurs.
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Yea, what would Best Buy do if that happened? Actually remove its 3% of customer service that they actually provide?
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Don't forget that working in any tech store requires more than tech knowledge. CC, like any other company, wants to SELL you something. The experienced people are the ones who can manager or are the ones who have the tech knowledge AND the ability to sell you something like a new PC or TV or whatever.
You can have great tech knowledge but blow at selling. Or you can be a great seller but don't know squat about what you're selling.
I'm not saying all their employees that they nixed are great at either but they nixed a good portion of the ones who could, at the very least handle it and kept a good majority of the ones who couldn't.
THATS the problem with why they axed their experienced employees and why people are generally pissed.
But either way CC is now going bye bye. Just another empty store in another slowly vacated strip mall. I wonder who's next in december?
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Why would you hire FireDog when they already got rid of their most experienced people.
How's FireDog supposed to compete with Geek Squad when it's staffed by n00bs?
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here is the list of the stores:
http://consumerist.com/5...ing-circuit-city-stores
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DudeBoyz nailed it. We all know where the "fire" in FireDog came from. And yeah, there is a store closing list - a PDF I saw someplace. Thankfully my local store is not on it..its kind of a hang-out for all the local geeks. Unfortunately its stock is outdated and usually overpriced (like everything around here). How bad, you ask? They don't even have the PC version of Fallout 3, probably the hottest game in existence. We actually took some pictures three months ago, and while a few things have been shuffled around its the exact same merchandise.
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I agree with DudeBoyz. To fire and replace valuable employees ONLY because they were making too much money is the epitome of corporate greed. Why not fire upper management for making too much money? I too have no sympathy for Circuit City. They brought this on themselves and it is well deserved. I do feel badly for the innocents who do work there trying to make a living in the stores though. I hope they will be able to find new and better jobs. I suggest that everyone from here on boycotts Circuit City.
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"To fire and replace valuable employees ONLY because they were making too much money is the epitome of corporate greed"
Corporate greed? How about, survival? Circuit City has been doing terrible for a long time now, they HAD to fire their highest payed employees just to stay in business...when a company resorts to releasing employees on this scale or cutting salaries, it's usually a last resort option for a company that's on its death bed. I feel bad for the people that got laid off, but it's the nature of the beast unfortunately.
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"Corporate greed? How about, survival?"
I see you too have an inability to look long-term (and I'm not talking about looking long-term now; they should have done so a long time ago).
Experienced people know what they're talking about and are more likely to make sales.
Sales = money
Money = survival
Axing experience is a short term fix that will very quickly backfire.
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"I see you too have an inability to look long-term"
I see you have an inability to read (or an inability to comprehend what you read). Cutting personel or cutting salary is a last resort for a dying company...if you're a public company that's bleeding money, guess who's breathing down your neck to cut costs, yup you guessed it...shareholders. And guess what's the most expensive part of running a business...right again...its employees.
Look, everybody is pissed about these layoffs, but there's only so much a brick and mortar store can do when it's losing sales to online retailers, which can afford to sell for cheaper. Why do you think Amazon is still doing good? People are moving to the convinience and money saving online retailers.
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"Cutting personnel or cutting salary is a last resort for a dying company"
For a dying company, yes. For a company that has any form of forethought it shouldn't even crop up.
Cut the amount of managers, cut their pay, whatever.
Cut the crap employees on low pay (who outnumber experienced employees most of the time anyway and you'll likely save more than you would axing the experienced).
There are multiple options available.
Cutting the experienced people who make the sales is the foolish approach.
Just because the experienced employees may be the most expensive part does not mean they are the first place you go when you need to save money.
It's too late now, but it would have been better earlier.
In the end it's futile unless you've built up an online presence anyway, and yet again, that's down to lack of forethought if you haven't.
People still like to touch and try out objects before they buy them (generally above the $500 mark though), which is why shops are still important.
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Def. not. They should of laid off the retards that are working there now.
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"Why not fire upper management for making too much money?"
Why not fire upper management for sinking this company!
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Why it makes better sense to employ a high school dropout at min wage than pay a college grad with experience and knowledge to boot. Most high school grads can be "trained/programmed" to say the same sales pitch to get the highest markup items out the door.
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well said
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Is there a store closings list?
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Yes! Many of them!
Google: Circuit City store closing list
http://files.shareholder...re%20Closing%20List.pdf
Does anyone here know how to use the Internet? ;-)
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The internetz? Isn't that a bunch of tubes? :D
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No lol, its a bunch of nets :P
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"Does anyone here know how to use the Internet? ;-)"
Let me send a Western Union to Al Gore and ask him...
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Now a days its a bunch of Bots. Must have had Fire dog service their PC's!!
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Got no sympathy for these guys after they fired their most experienced employees - in two different instances - in order to save money by replacing them with n00bs.
I'm bummed that even more people are losing their jobs, but Circuit City as a corporation, they just suck.
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