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"Circuit City gives up the fight"


Anthony G
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First CompUSA, now CC:

 

Story

 

Circuit City is reeling from five consecutive quarters of declining sales at stores that have been open for a year or more, after increased competition from discount retailer Wal-Mart and warehouse club Costco Wholesale (COST, news, msgs). Last year, several electronics stores were decimated -- CompUSA shuttered all its stores before being bought by a restructuring firm in December, and Tweeter Home Entertainment, Harvey Electronics and Rex Stores filed for bankruptcy.

 

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seems like a doomed combination.

 

No shit!

Hell, it' amazes me that Blockbuster itself hasn't already gone out to pasture. :umm

 

It's like someone from the doomed Titanic throwing a life preserver over to the equally doomed Lusitania. :o

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Hell, it' amazes me that Blockbuster itself hasn't already gone out to pasture

 

There aren't any other retail rental locations around here anymore. Hollywood video is gone

 

As for CC. I'm shocked it did not go out a long time ago. The organization of the stores are a mess, they only had the customer service register open at the few here, and they were always out on sale items

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I recently hit the Blockbuster here in my town looking to rent a Bluray that I wanted to see but not buy. The price of renting a Bluray title was laughable. I passed. But I was actually surprised how many customers were in the store. About fifteen I'd figure. It was a Wednesday evening. I have no idea if that one sampling was typical.

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There are numerous reasons buyers beyond Icahn are not lining up. Circuit City is in an extremely competitive business with heavy pressure from Wal-Mart Stores

 

I once watched an analyst predict the fall of most electronic chains because of Wal-Mart by 2009. It seems to be coming true. He mentioned CompUSA, CC and Best Buy as well. I can't stand walking into the local Wal-Mart by me and they don't hold a candle to Best Buy in terms of selection.

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I avoid Circuit City like the plague unless there's a REALLY good deal... which I'll do in-store pickup for.

 

I can never find anything in their DVD section because of their top down ordering system, which should have been fixed 5 years ago...

 

New video games are behind the customer service desk where you cannot even look at them because I guess they are too cheap to get the plastic security cases Best Buy has.

 

The problem with a lot of these companies is that they don't have people that know their product at the top.

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New video games are behind the customer service desk where you cannot even look at them because I guess they are too cheap to get the plastic security cases Best Buy has.

 

Exactly. I love going into BB and browsing the movie area, then I usually head to the games section and browse there as well. When I go to CC i cant browse the movie area without moving rows of stuff, and as you mentioned the games and stuff are behind the customer service counter. People can complain about many things when shopping at BB, but you gotta admit they have the layout down well

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CC went down the tubes once they got rid of their commissioned people.

I agree...

 

I was at the store a few months back (received a $50 gift card for xmas) and it was the tuesday No Country for Old Men came out. Looked over the new release section: no dice. Looked over the blu ray selection: no dice. So I look around for a csr and see none... go over to CDs and get "that's no my section" from one employee...

 

So I go to guest service and the conversation goes:

"Hi, I'm looking for 'No Country for Old Men' on Blu-ray"

"Oh, Blu-ray ... I don't think we have that"

"But it's advertised in the paper"

"Yeah, did you see it in the Blu ray section?"

"No ... I was wondering if you could look to see if you have it in the back or behind the desk with the video games"

"No"

"Can you look it up in the computer"

"Sorry, I don't know how to do that"

...

"Thank you".

 

And I walked out. Went across the street to Best Buy and found it instantly with the new releases. Urgh :)

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While I've had nothing but crappy experiences in their stores, I have to say that I've had very good results with their online sales. A recent example was their 2 $20 titles for $30 online game sale. Free shipping, and it got to me two days after I ordered.

 

Being the cheapass gamer I am, I worry that if they go away, there's that much less of an incentive for everyone else to compete pricewise.

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CC went down the tubes once they got rid of their commissioned people.

 

I worked for CC when I was fresh out of high school back in the late 90's. When they had commissioned sales people that had people that knew their products and were overall customer based.

 

They made another fatal mistake before getting rid of commissioned people. That was getting rid of major appliances. They cut out a 17.5% margin area of the store that always did well and didn't take a lot of training/sales people to maintain and decided to add software so that they would seem more focused.

 

The second problem was trying to become best buy and throwing out all of their good sales people because their hourly rate was too high from their commissioned status previously.

 

Thankfully I left long before they got rid of commissioned sales people but my friend was working there when they gave the severance checks to everyone and waved goodbye to their future. With commissioned sales people, the successful ones understand the business, understand the products and understand their customers. These people go on to make good managers. When they switched this process they lost their management recruitment areas and they began to spiral.

 

I did a short time at best buy when I was going back to school and it was the worst 6 months of my life. I don't think CC would have been any better at this point. But they've both lost sight of what the point of having a retail location is, and that is knowledgeable and helpful sales people. I would never depend on either of the stores for their opinions on what I should buy or how to set things up. I would research it online or ask questions on knowledgeable forums like this one. I'm sure I'm not typical but I loathe going into these places anymore.

 

/rant, sorry might be some pent up rage there ;p

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For DVD's, games, etc I have no problem going into BB. For everything else it's a good thing in NYC is we have PC Richards which are on commission. The sales staff is knowledgeable on everything they carry. At least the 3 in our area I have been to. Despite BB, CC, and all these other giant stores still do very very well. They are more focused then the others. Bigger selection of TV's, video players, Major Appliances, etc and do not focus at all on DVD's, Games, etc. even though they do have a small selection. If you try you can always get the sticker price brought down even more. Sometimes by a large margin.

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I agree CC was better to the customer when they were on commission but the company got raped by "creative" salespeople who figured out how to manipulate discounts. It happens in most commission based systems but CC's POS system and sheer size at the time made it impossible for their Loss Prevention department to manage. The only solution was going hourly like Best Buy.

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They do have some killer online sales though. I was browsing a few months ago one day and saw a Samsung 19" HDTV LCD for $250. I bought it on the spot and picked it up later that day. The next day the price was back up to $350 and I have not seen a price come close to that to this day.

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I agree CC was better to the customer when they were on commission but the company got raped by "creative" salespeople who figured out how to manipulate discounts. It happens in most commission based systems but CC's POS system and sheer size at the time made it impossible for their Loss Prevention department to manage. The only solution was going hourly like Best Buy.

 

Only 5-7 people at any location had access to price changes. You couldn't just change the price and ring it up. CC's POS system, while old was very thorough and decently thought out and left a significant paper trail that was quite easy to follow.

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Only 5-7 people at any location had access to price changes. You couldn't just change the price and ring it up. CC's POS system, while old was very thorough and decently thought out and left a significant paper trail that was quite easy to follow.

 

I have no doubt there were good stores and good employees who walked a straight line. I can tell you I was given access to CC LP figures around the time they finally made the switch. It was a change they had to make to survive.

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