Circuit City will close 155 stores and lay off 7,200 employees, or 17% of its workforce, as it continues to restructure its business. These closings represent more than 20% of U.S. stores and includes the exiting of 12 markets.The store closings will shrink the number of locations the chain operates in the U.S. to 566.
The chain also faces credit issues with its vendors. Circuit City said certain vendors have changed payment terms, including demanding cash for inventory before shipping merchandise, as the all-important holiday shopping season approaches. Vendors also have limited the credit available to the company for purchases, including in some cases not providing customary increases in credit lines for holiday purchases.
We just hope that Best Buy and other more general retailers (Target, Wal-Mart) will take up the slack. While we all love to shop and buy online, there's nothing quite like walking into a huge gadgets retailer and touching and feeling all of these gadgets before buying them. Don't you think?
More at the Richmond Times-Dispatch.
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Does anyone remember that Circuit City, just a few years ago, was the best performing company in Jim Collins' book "Good to Great"? Obviously, Mr. Collins' approach to management is worth some reconsideration given the fall of Circuit City. It would seem a new approach to management would be worth considering. Read more at http://www.ThePhoenixPrinciple.com