Circuit City, Where Service Was Never State of the Art

Circuit City – We Told You So…

In what was probably the easiest call in the last ten years, we told you Circuit City was going to go all the way (read our November 12, 2008 post if you don’t believe us). Back then we said you shouldn’t “be fooled by their reorganization plans; Circuit City is down for the count and not getting up. Lousy leadership is lousy leadership, and court protections will change nothing.

“While Chapter 11 might provide a short-term reprieve and allow them to stock their stores for Black Friday 2008, they’ll not be around for Black Friday 2009. (Heck, they probably won’t make it to Good Friday.)”

We were right, and we just want to gloat.

Circuit City, unable to work out a sale of the company, said Friday it will close its 567 U.S. stores and cut 34,000 jobs. Nice going, guys. Please don’t blame this on the economy. You were the nation’s second-biggest consumer electronics retailer and you failed to build a sustainable business. There’s no excuse.

What’s amazing about the retail bankruptcies during this recession: KB Toys, Mervyns, Linens ‘N Things and now Circuit City; is that none of them are surprising to us. If you ever stepped foot in one of these stores and compared them to their biggest competitor (Toys R Us; Macy’s; Bed Bath and Beyond; and Best Buy, respectively) you’d know who was the best and who was not. You’d understand that it would not take much to cripple these also-rans.

Whether it was another big box selling the same goods or Wal-Mart, Circuit City never stood a chance. They could not be expected to survive even a slight downturn if their leadership was unwilling to have the singular goal of building a sustainable business. Their selection was inferior, their prices appeared non-competitive, and their salespeople were clearly on commission. It was never “fun” to shop at Circuit City, and the leadership should have recognized this.

That was their job. Of course, the employees could have told them… if they bothered to ask.