Financial Times: Gloom deepens at Circuit City

[marmar]

Gloom deepens at Circuit City
By Jonathan Birchall in New York

Published: September 29 2008 16:11 | Last updated: September 29 2008 16:11


Circuit City, the struggling US electronics retailer, said on Monday it had abandoned an effort to find a potential buyer, as it announced a second quarter loss as the number of customers visiting its stores fell sharply.

The retailer, which has been buffetted by both the downturn in consumer demand and increasing competition, said it had seen a double digit decline in traffic at its stores, with total sales down 9.6 per cent at $2.4bn.

Sales at stores open at least a year were down 13 per cent. It reported a loss of $162.7m, with an additional unanticipated $73m of impairment charges linked to write downs of store assets.

The net loss was $1.45 per diluted share including the charges.

Jim Marcum, who took over as chief executive last week from Phil Schoonover, said the management realised the results were “unacceptable”, and announced a series of new management changes and initiatives aimed at improving the performance of its stores.

He also said that Circuit City had lost its focus in recent years, as it faced new challenges including the growth of e-commerce, and the push by Wal-Mart and other mass-retailers into the consumer electronics market. ......(more)

The complete piece is at: http://www.ft.com/cms/s/0/104884ca-8e36-11dd-8089-0000779fd18c.html

[AndyA]

1. Excuses, excuses, excuses.

I'm sure they feel the fact that they fired all their higher paid associates who had good product knoweldge and could answer customer questions, and replaced them with a bunch of minimum wage people who couldn't care less has nothing to do with the drop off in customers visiting their stores.

I can't think of the last time I was in a Circuit City store. But I do remember NO ONE knew what the hell they were talking about. There's no reason to go back.

[tularetom]

2. Boo effin hoo for Circus City

They are the worst for service, employee relations, and even for availability of products they advertise (bait and switching).

Wally world and Best Buy are damn near as bad, if I want to purchase electronic items I generally patronize Costco.

[slackmaster]

3. A pox on Circuit City for not honoring the warranty on a Sony cassette player I bought in 1989

I haven't set foot in the door of any CC store since their service department gave me the runaround.

Screw them.