From the AP wire, via WTOP.com via Fark.com comes the news that Circuit City's are all closing. You can read the WTOP article by clicking the above headline, or you can go here:
http://www.wtop.com/?nid=111&sid=1514456
Seriously, does this news comes as a surprise to anyone who has followed the news over the last few years, and can you REALLY blame "The Economy" for this happening? I'm sure you'll see over the course of the current news cycle about how Circuit City going under thrusts an estimated 30,000 new unemployed folks out into the streets, but honestly whose fault is it really? This article mentions the fact that their execs didn't take the "threat of Best Buy seriously", but their problems started way before this year when they decided it was a great cost saving move to layoff 3400 of the mid-range waged employees, employees who had worked for the chain for a number of years and who, being rewarded for their hard work and service to their stores, had earned themselves systematic raises, or promotional raises (again based upon their loyal service to the company). When they had announced that boneheaded move at the end of March 2007 I knew they were slitting their own throats and encouraging their customer base to be as loyal to them as they were to their employees. Employees who, by the way, were deep within their primary marketing demographic.
This is much more an example of horrible corporate strategy than bad economic times. Once all those initial layoffs started word of mouth began to spread. Disgruntled employees started disclosing the many flaws in their stores marketing and retailing money grubbing scams. Negativity ran through their sales demographic as those who did their research began to realize the many flaws and schemes that are prevalent in the retailing system. A second round of layoffs a few months after the first was really the icing on the cake, leaving CC with little if any mid range employees (those employees that would be experienced and in the trenches sort of speak) to watch out over their business, let alone give a rip about it.
My point is made by this story earlier in the week where two guys walked right into a CC in Salisbury North Carolina and walked straight out with a 67 inch flat screen (retail value around $3200), only to have an employee chase them out of the store to ask them if they needed something to help tie the set to the roof of their small car. The thieves told the sales rep that they did need some rope and the boneheaded under-payed (I assume he was probably not caught in the rounds of layoffs at least if her was still working there)clerk went back into the store to get them some. By the time he returned he thought it was odd they didn't wait for him as he watched them leave the parking lot securing the set to the roof of their car just by hanging onto it. That article is here (and I recommend reading it because it IS rather funny!):
http://www.salisburypost.com/Area/011309-Circuit-City-television-theft
The CC execs idea of cost cutting was indeed short sighted when in the long term salesmanship comes mainly from loyalty and word of mouth.
Certainly the economic downturn did factor into their bankruptcy, but in truth once this Corporate decided to cut out its middle, its HEART, they were destined to eventually bleed to death anyway. Another example of sad corporate greed eroding the middle class. Now you wonder why I don't care for Wal-Mart?
WAKE UP!!
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