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Circuit City Falls Victim to Recession, Begins Liquidation

1/16/09, 12:25 pm EST

Photo: Beck/AFP/Getty

Circuit City has become the latest victim of the economic downturn wreaking havoc on the electronics and music industries. The company issued a press release today announcing it will seek the approval of the Bankruptcy Court to begin liquidating all its assets.

“We are extremely disappointed by this outcome. The company had been in continuous negotiations regarding a going concern transaction,” Circuit City vice chairman James Marcum said. “Regrettably for the more than 30,000 employees of Circuit City and our loyal customers, 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.”

Circuit City filed for Chapter 11 bankruptcy protection in November 2008, closing 155 stores before the end of ‘08 while it sought a buyout; an attempt to merge with Blockbuster fell through in July. With the retail giant closing its doors, music fans are left with one less place to buy CDs, as well as stereos and the other audiophile gadgets — just last week, thousands of newly developed electronics debuted at Las Vegas’ Consumer Electronics Show (CES) (click here for our rundown on the best).

As Rolling Stone has reported, the flagship Times Square Virgin Megastore is closing, and Best Buy is devoting less floor space to CDs. Yesterday industry blog Coolfer pointed out a blog post by echo’s Mark Montgomery, who attended Billboard’s Digital Music Conference and heard that “the CD might have two more years in Walmart.” Walmart is currently the nation’s second-largest music vendor, behind iTunes. As of now, the outlook for physical album sales is certainly bleak.

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Comments

Itchyfinger | 1/16/2009, 1:19 pm EST

IS CIRCUIT CITY BURNING??!!! BURN, SLIME-INFESTED CITY – BURN, BURN, BURN!!!!!

These scumwads cheated me out of my installation disc when I purchased a Vista desktop (when there wasn’t a choice to avoid Vista for non-mac users), so I have no product number to enable Microsoft Office! Their worthless warrantee excludes the software, including drivers and setup programs which none other than they are responsible for installing!

Kevin the Robot | 1/16/2009, 1:21 pm EST

In the 90’s, Circuit City was the place to buy cds. They had a better selection and prices than any music store. I use to drive an hour out of town every month just so I could go to one. This is where I discovered import singles and fell in love with incredible b-sides by bands like Oasis. Nowadays, their music selection is 1/10 the size it was 10 years ago. They only carry new releases by big named artists and good luck trying to find it in the store. The store’s become an injured horse and its time someone took out behind the barn and shot it.

Bob Saget | 1/16/2009, 2:40 pm EST

“Circuit City Falls Victim to Recession”???? ARE YOU JOKING? Anyone whose ever spent more than 5 seconds in that store can tell you this was a long time coming. For the past few years Circuit City was the most poorly run company I’ve ever seen. The employees looked like they were never trained, the store itself was horribly organized, and its like they never even cared to try to compete with similar stores in value, customer service, etc. This was not cause or the result of the current economic crisis but POOR MANAGEMENT. I feel bad for anyone who lost their job and my heart goes out to them; but good riddance!

Ken | 1/16/2009, 2:58 pm EST

About 10 years ago, I visited a Circuit City in Omaha, NE, the city I live in. I was pricing refrigerators for a new house. They had a model on display, with the regular price tags and everything. I decided that particular model was the one I wanted, so I got the salesman’s attention, and told him we wanted to buy that particular fridge. His reply was ‘Oh, well, they don’t make this one anymore and we don’t have any more in stock. But, we do have this nice one here for just a little more…..’ I asked him if he’d ever heard of bait and switch, and I walked out. I never went back to Circuit City, so good riddance.

CCity Zombie | 1/16/2009, 3:43 pm EST

I worked there…Our store was one of the 155 that closed just before Christmas. I cannot say I am disappointed by this news. We were treated like crap and still have not received our bonus for staying during liquidation.

Weegie | 1/16/2009, 3:45 pm EST

Bought a high priced VCR back in the day from CC………….it died after 5 weeks, 3 days after the warranty ended….i’ve been waiting for revenge for 14 years :)

Anonymous | 1/16/2009, 3:48 pm EST

Circuit City is really going out of business because of this greedy a-hole kid:

youtube. com/ watch?v=epP3jETf8Og

(remove the spaces)

Some one | 1/16/2009, 5:08 pm EST

I love the comments all of the web about people holding grudges on this company for more than 10 years… Get a life. it is sad that all the people are loosing their jobs, buy other than that I have no comment. Don’t blame the people who worked on the floor. Blame managment. Even if there were bad people working on the floor it is managmenta fualt for not recognizing and fixing that issue!

iLly | 1/16/2009, 6:15 pm EST

Wow. I’m so sorry for you, mother fuckers.

Pamela | 1/16/2009, 11:33 pm EST

The last time I was in CC was several years ago looking at a GPS on sale for over $500. The sales person’s attitude was so bad I walked out and Best Buy matched their sale price. I’ve been to BB dozens of times since but never back to CC.

CCity | 1/17/2009, 2:18 am EST

Store 3375 here: you cannot even imagine what the employees at Circuit City are going through right now unless you YOURSELF works at one. The saddest part is hearing that guests are either (a) thrilled we’re going out of business or (b) hoping for a good deal. Karma-what goes around-comes around. People like IchyFinger have no compassion or heart for those of us who VERY SHORTLY will be using HIS OR HER tax dollars and sitting in the unemployment line. I’ve worked with some of the best people at Circuit and I’m incredibly sad to see us go.

Strange Times | 1/17/2009, 4:10 am EST

Their stores were so poorly run and looed so messy inside it was a wonder how they lasted so long. Goodbye and good riddance. The economy didn“t kill them. They took care of their own fate a long time ago.

G | 1/17/2009, 9:56 am EST

I currently(or not so much) work at a Circuit City in Maine and can honestly say(despite not having a job)GOOD! I’ve worked there for a little over a year now and you wouldn’t believe how bad of a company this is ’till your worked for it. There was just no sense to the actions regarding store operations. Anyone in there a bit ago when they had the promotion about opening up 65 new stores?! And then there’s how poorly they treat employees who AREN’T management. This company never cared about it’s employees, kept us in the dark about EVERYTHING. Wost job I’ve ever had(and i did landscaping for 6.35 an hour) and say good riddance.

van | 1/17/2009, 1:41 pm EST

circuit sucks, i’m glad they fall. their stuffs are always higher than other company. I remember couple years ago when I went there to buy a cheap labtop those god damn sales person wouldnt sell to me they had me to another city store TWICE then I got really pissed and threaten to call their manager that’s when they finally descided to sell it to me. If they have a good discount then their workers will tell you it sold out and wait for their friends to come and buy it. I havent been going to circuit city for years now because of what happen then.

Joe The Customer | 1/17/2009, 2:19 pm EST

The problem with Circuit City is the same problem that plagued CompUSA, the bottomline comes down to poor customer service and unknowledgeable salespeople.

For whatever reason, top executives in these company’s seem that they do not understand this concept. Merchandise alone will not generate a sale.

The consumer has to feel confident that they are dealing with people that know what they are talking about and that the stores have the merchandise in stock and ready for the customer to take home. It’s a very simple concept. Give the people what they want or fail! Rest In Peace Circuit City.

About Time | 1/17/2009, 3:28 pm EST

Given the way they’ve run their stores I’m not shocked this didn’t happen sooner. Have you gone in there? It’s downright terrible. Good companies will survive this crisis. The crap ones will be gone. This is no different. Best Buy remains the best, I think we’ve all gone there and bought alot of stuff there.

Shawn 412 | 1/17/2009, 5:17 pm EST

Backing up this qoutebelo it happens to be very accurate.
“the bottomline comes down to poor customer service and unknowledgeable salespeople.”

Today I went into a CC store to see all the hubbub, they jacked prices from last time I went in to a CC ( a week prior to liquidation)
spoke to a few eager consumers about how things (merchandise)went up not down only a few select items ranging over 1500.00 USD were given a 10% discount as for the small stuff it was like I mentioned marked up like a PC mouse. Enough for now I guess we will see in next few weeks how it goes I will post up again once prices analyzed.

jav | 1/17/2009, 7:40 pm EST

Wow, there really are alot of nasty people who patrol these threads. CCity I agree, the people who work for the company are going through terrible times. Van, how’s the third grade spelling and english coming? He’s probably too good for ccity, he’s more a MC D’s man.

Bitchy Richy | 1/17/2009, 10:28 pm EST

Circuit City really shot themselves in the foot several years back when they got in bed with the DVIX technology that was the short-lived rival to DVD. They only stocked DVIX in their stores, and refused to sell DVD until it had already proven to be the market leader. Then they kept stores in undesirable locations where the rent was cheap, and fired experienced employees in favor of know-nothings hired for bottom dollar. It’s sad to see a loss of consumer choice in the market, and especially if it adds to Wal-Fart’s market share….but anybody could have seen this coming.

Joe | 1/18/2009, 6:31 pm EST

Thank God Axl Rose was smart enough to go to Best Buy instead of these jokers.

Anonymous | 1/19/2009, 12:48 pm EST

Yeah Joe… Best Buy is doing awesome at promoting Chinese Democracy!

That was a smart move by Axl and co.

jl | 1/19/2009, 10:39 pm EST

Circuit City was (and unfortunately still is) all about trying to extract money from customers anytime they get a chance. They never approached the business from the idea of building long-term customers. They might as well be selling used cars. Service is their worst aspect, try finding anyone there who knows anything about what they sell. Funny, their motto used to be “come to circuit city, where service is state of the art.” Not only are they now in trouble, but they put out a large announcement stating that things will be on sale. Unfortunately, when people showed up on Saturday to help them pay off their creditors, it turns out that nothing is on sale. So even now, while they are just trying to pay off their debts, they are not doing much to encourage customers to come in and help them pay this down.

This lack of interest in building a relationship with customers is why they are done. Sorry for those who work there, they don’t make these decisions, but for those in charge, this is what they get. When your business is dependent on customer happiness, you might consider making them happy.

natespimp | 1/20/2009, 3:42 pm EST

Hey ccity zombie, Do you no the name of the liquidation company that we used. I did not recieve my bonus either..

Surley | 1/20/2009, 6:51 pm EST

I am glad they are going under. Terrible customer service, tons of bait/switch and crappy products. I hadn’t been in there for five years, but I went to see it burn. Nothing was on sale. They had jacked up prices in order to give faux discounts. At 10am the first day of the liquidation they claimed not to have anymore iPod touch mp3 players. Yeah right. Bastards.

Barrack Obama | 1/20/2009, 11:25 pm EST

I think Circuit City is ready for change.

John F. Higgins | 1/26/2009, 8:08 pm EST

Ignorance is Bliss!
I Did not realize CC was PRO -Profit and Customer Satisfaction non-existant! I was a customer but NOT an exclusive customer(thank God!). Yes! I am glad CC is going out of business. Let’s keep the US market place reputable.

John F. Higgins | 1/26/2009, 8:08 pm EST

Ignorance is Bliss!
I Did not realize CC was PRO -Profit and Customer Satisfaction non-existant! I was a customer but NOT an exclusive customer(thank God!). Yes! I am glad CC is going out of business. Let’s keep the US market place reputable.

Shawn 412 | 2/11/2009, 11:46 am EST

Went back this past monday to look at prices, we hit the 30% on some items and 10% on computers (desk and laptops) 20% on routers and other various electronics. on another topic I ran into a customer whom did not understand the scope of a liquidation and wante dto exchange and or return a recently purchased item, they must not have read the signs or disclaimers all over the store. I did hear them mention that one of the associates told them they could bringthe item back if it did not work, true to the steady decline of CC they supported a 100% no takesies back or exchanges. Cunsumers know what your getting into and research what you plan to buy from liquidators prior to purchasing and alway do not make the liquidation your first stop when window shopping for prices other places may have the items competitvely prices or marked down.

Anonymous | 3/5/2009, 6:55 pm EST

i really fell bad for thoes people who are going to lose their job i am really going to miss that store

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