Retail Casualty: Circuit City

This one hits at home.  I am a native Richmonder and have lived in the area all of my life.  I have friends who work or have worked for the company.  It’s HQ was here.  CarMax started here (CarMax was owned by Circuit City, but was spun off years ago.)  Circuit City is probably one of last national retailers to have called Richmond home.  Best Products closed up many years ago.  Thalhimer’s and Miller and Rhodes-not quite national, but they had stores in several other states, were bought up and are no longer around.

Circuit City filed for bankruptcy protection back in November of 2008.  The holiday buying season did not do much for Circuit City’s bottom line.  The remaining 567 stores will be liquidated and thirty thousand people will lose their jobs.  The company had hoped that a buyer would be found for the company, but none came forward.

Circuit City began life as Wards Company in Richmond, Virginia in 1949.  The company was founded by Samuel Wurtzel.  During the 1950’s, the company expanded and, by 1959, there were four stores in the Richmond area.  From that time through the 1980’s, the company tried many formats and operated stores under several names, including 'Wards Loading Dock, Sight N Sound and, of course, Circuit City.  The Loading Dock was the company’s first large format store.  That format was the more successful and customers also liked the Circuit City name, which became the company name in 1984 when it began trading on the stock exchange.  By 1990, the chain was a significant national chain.  It entered New York by acquiring the remnants of Lafeyette Radio. 

It entered the banking world by founding the First North American National Bank, which it sold to Chase Bank in 2004.

Circuit City’s biggest problem was, of course, Best Buy.  Circuit City really did not anticipate the emergence of Best Buy and, unfortunately, they are paying for that mistake now.  Other factors include the big box warehouse stores and the internet.  Circuit City was just too slow in trying to catch up and, sadly, never really offered anything to make them standout.  They could not compete in price and, over the years, developed a poor reputation in the customer service department.  I can remember many times where I either needed help and could not get any, was swamped by sales people when I did not need them or, get this, was made to wait or just plane ignored when the attractive woman JUST came in the area.  Happened many times. 

Admittedly, I am part of the reason they are going under.  I pretty much stopped shopping there years ago, for the very reasons mentioned above.  When Best Buy opened a store right across from the Circuit City I frequented, I was unimpressed and continued to shop the City.  However, about six months later, I went to Circuit City to buy a computer.  The service was terrible.  They made me so mad, I went across the street and bought one at Best Buy.  I’ve been shopping there since.  Oh, I still went to Circuit City, when they had a sale or had something I could not get at Best Buy.  I don’t remember the last time  I bought anything there.  Probably sometime before Christmas, but I don’t remember.

In a month or two, Circuit City will just be another footnote in the retail history of the nation.  While I may not have shopped there regularly over the last few years, I will miss them.  Anytime competition is diminished, the consumer will suffer.  Circuit City’s demise removes a big competitor from Best Buy and others.  I feel worse for the 30 thousand or so who will lose their jobs.  I suppose the only good thing about this is the timing.  They did at least make it through the first of the year.

 

Note: this is a repost from my ‘Half Byte’ blog.