It's a sad state of affairs at Circuit City.
(Credit: CNET Networks)I remember when "liquidation" meant something. There was a small electronics store in my area that was closing down a few years back. Signs all over read "Liquidation Sale." In the store, I found prices slashed considerably. Some good stuff was 75 percent off. It was a fire sale, and it was fantastic. That was a going-out-of-business sale done right. What Circuit City is doing now, though, I don't get.
The company is shutting down, as we all know. But I was still shocked when I went into Circuit City this past weekend and found a store that was a shadow of its former self. The signature red shirts on employees were ditched in favor of jeans and sweatshirts; DVD sales racks that were once barely browsed were overrun by customers who couldn't help but dive in to the store's 50 percent off DVD sale. But the real bargains that Circuit City claimed we all would love weren't so sexy after all.
I need a new HDTV. Usually, I buy my HDTVs from Amazon.com because I've found it has the best prices and delivery service. But since I knew Circuit City was going out of business, I decided to make a trek down there to see if there were any hidden gems at a good price. Signs said the TVs were 30 percent off, and when I looked around, I realized the inventory wasn't picked over, as I had feared. There were some nice Sony LCDs on the shelves, as well as Panasonic plasmas.
I was drawn to the Panasonic TH-58pz800u, which was on sale for approximately $2,600 at the store. I own the 50-inch model of that plasma and couldn't be more pleased with its quality. So when I saw it offered at such a discount, the wheels started turning and I was thinking about how I was going to be able to fit it into the back of my SUV.
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So long, Circuit City.
(Credit: CNET Networks)Circuit City, the world's second-largest electronics retailer announced on Friday that it has been forced into liquidation after attempts to sell itself to a third-party failed.
Circuit City's liquidation is sad, but it shouldn't come as a surprise. The company has been facing serious financial issues for the past few years and was delisted from the New York Stock Exchange after filing for bankruptcy and witnessing its stock price plummet to near worthlessness. Moreover, the economic crisis had a severe impact on Circuit City, and fewer creditors were willing to offer the company attractive rates as it tried to purchase goods for sale.
But it wasn't always like this for Circuit City. The company once enjoyed great success, and it can trace its roots all the way back to 1949.
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Why is it so hard for everyone discussing Circuit City's Chapter 11 filing and New York Stock Exchange stock suspension to tell the world what really happened with this company?
No, Circuit City isn't dying because of the credit crunch, and there's no way we can blame its demise on the preferential treatment competitors like Best Buy are receiving. And we certainly can't blame it on the online-retail industry.
For some reason, every story I see written about the topic gives the company line--Circuit City is forced to file for Chapter 11 protection because of the "tight credit market"--and yet no one tells it like it really is: Circuit City is dying today, and will be a mere memory in just a few short months, because the company's executives ran the business into the ground.
Some believe that with the online onslaught being what it is, there's really only room for one major electronics retailer in the brick-and-mortar space. Anyone who believes that has no grip on reality.
There is room for multiple big-box electronics retailers. If Circuit City executives established a business model that competed with Best Buy's instead of trying to copy it, none of this would have ever happened, and we would be wondering which retailer will have the better holiday shopping season.
Instead, we're digging Circuit City's hole.
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