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The Last Will and Testament of Circuit City
Posted by
timothy
on Sun Mar 08, 2009 03:40 PM
from the oh-the-huge-manatee dept.
from the oh-the-huge-manatee dept.
Harry writes "Sunday is the final day of business for Circuit City, the once-dominant national consumer electronics chain done in by the rise of Best Buy, the crummy economy, and multiple failings of its own. I paid a final visit of respect to my local store, and found that they'd gotten rid of just about all the unopened electronics products, and were therefore selling off stuff like broken computers and the toilet-paper dispenser from the restroom. Whether or not you were ever a fan, it was a sad scene." NPR has a segment on the end of the Circuit City era as well.
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Submission: The Last Will and Testament of Circuit City by Anonymous Coward
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sad? (Score:5, Funny)
"Whether or not you were ever a fan, it was a sad scene"
Newbie.
Really? (Score:5, Insightful)
Re:Really? (Score:5, Insightful)
Why is their death sad?
For a lot of people the only substantial consumer electronics retailers are best buy and circuit city. After circuit city is officially gone, best buy will have numerous markets without even token competition for consumer electronics (unless you count walmart).
Hence even losing a lousy retailer is still a loss for the consumer. One could potentially expect to see best buy starting to carry even less variety of product, as they won't have much to worry about competing against.
Parent
Re:Really? (Score:5, Insightful)
Buy online. Between newegg and Amazon I get everything I need with no hassle and good prices. The only time I have bothered to go to a brick and mortar store like BB in recent memory was for a cable. After seeing how outrageous the price was I went home and ordered that online as well. I'll pay a 100% premium for a last minute local need, but not a 1000% premium.
Parent
Re:Really? (Score:5, Informative)
I like Office Depot things I used to go to BestBuy or Circuit City for that I don't buy on NewEgg. Cables, SD cards, maybe a keyboard, a landline telephone. They have a nice selection.
Parent
Re:Really? (Score:5, Insightful)
Online isn't a complete substitute. I can't walk into Amazon's camera department and give a bunch of the cameras a try to test their shutter release delay. I did do that in Circuit City and Best Buy a couple years ago. (Wound up buying a camera from CC; it was on sale, and with the free SD card that came with it, wasn't much worse than online, and I had reason to want it then.)
Of course, you can still go into Best Buy to give it a shot, then buy online, but if the hypothesis of the parent is correct and people would lose selection, that's not great. (You can also look at stuff like dpreview.com, since they actually have these numbers for some cameras, but it's hard to change "0.1sec" to "acceptable/unacceptable".)
Parent
Re:Really? (Score:5, Insightful)
Those of us who are afraid of Uncle Sam spying on all our credit card transactions are called paranoid.
Parent
Re:Really? (Score:5, Interesting)
"Those of us who are afraid of Uncle Sam spying on all our credit card transactions are called paranoid."
My credit card purchases are not useful information for even the most toxic government. If anything they just add to the data burden such government would have to sift through.
If you decide to do things you don't wish government to be aware of, that same innocent activity becomes your smokescreen. You can manipulate the perception people have of you by what you reveal to them. You could even fake a persona by your choice of purchase, especially media. The way to hide FROM the system is to hide IN the system.
Parent
Re:Really? (Score:5, Funny)
That's all well and good until your pregnant wife has a sudden craving for pickles and plutonium and you don't have $1 million in cash lying around.
Parent
Re:Really? (Score:5, Funny)
I'm allergic to all synthetics.
Parent
Re:Really? (Score:5, Interesting)
Are you really that naive? Seriously?
It's easy to marginalize somebodies opinion by calling them "paranoid". That does not address the fact that government after 911 IS looking for tools to fight terrorism. The credit card companies already analyze purchasing habits to fight fraud. Is it really that much of a stretch that the credit card companies are going to use this data to provide targeted advertising? Detailed profiles on individual customers?
Of course they ARE. It's already happening. So why on Earth would the government not want in to start using that profile data to fight terrorism?
They ARE. There is a large list of items such as pre-paid cell phones that the government flags to start profiling certain people to determine just what threat they may represent. Purchase a pre-paid cell phone and have a middle eastern last name? Welcome to the "no-fly" list in the airlines.
Yeah, call us paranoid. There is no way governments have EVER been caught abusing their powers. Nope. No Sirrree.
Wait..... Wasn't Hoover obsessed with Martin Luther King and wrote scathing letters about he hated the man and abused his powers to spy on him and THOUSANDS AND THOUSANDS of others? Those are little things we call FACTS now aren't they?
Nahhhh. You're still right. We can trust everyone in the government to only violate our privacy when ABSOLUTELY necessary. I stand corrected and I see your point *now*. Gosh, I feel better.
Parent
Yup (Score:5, Funny)
Pretty much you are left out in the cold.
There is way better arguments for using cash than tin-foil-hat paranoia though:
1) Banks fucking suck. They don't always post your CC transactions right away so they can lie about your true balance and fuck you over with overdrafts and NSF's.
2) It is cheaper for the merchant. Cash = no merchant fees.
3) You can tip waiters and know they have the option of pocketing the cash instead of reporting it.
4) That is about all I can think of.
4.1) Oh yeah, the NBA, CIA, and Odwalla is spying on you when you use credit/debit cards. Only Russians and Odwalla spy on your cash transactions.
That said:
1) Pay in cash, and you can't reverse the charge if the seller fucks you over. You can sue them, yeah, but that is more expensive and you might not win. CC's let you chargeback.
2) Loose your wallet, loose your cash. Loose your wallet, deactivate your credit card.
3) You can import your bank statements (after everything settles down and posts correctly) into your favorite financial app and account for your spending.
4) The NBA and the NSA have joined forces to provide you with personalized mind control based on your credit card transactions. This is a good thing because all hail Uncle Sam.
Parent
Re:Yup (Score:5, Informative)
2) It is cheaper for the merchant. Cash = no merchant fees.
Depends. Often large stores want to get rid of cash as over a certain point the handling fees become prohibitive. Ever noticed how they always try to offer cashback?
Parent
Re:Yup (Score:5, Informative)
Plus of course there's the fact that credit cards tend to move lines faster. If this means a store can have only 4 lines open instead of 5, they're saving money right there.
Phil
Parent
Re:Yup (Score:5, Funny)
Oh yeah, the NBA, CIA, and Odwalla is spying on you when you use credit/debit cards.
If it weren't for this comment, I never would have known that the National Basketball Association and a juice company turned Coca-Cola subsidiary were spying on my credit card transactions. Thanks, Coryking.
Parent
Re:Yup (Score:5, Funny)
Parent
Re:Really? (Score:5, Insightful)
Parent
Re:Really? (Score:5, Insightful)
Circuit City only went out of business because most consumers already realized Best Buy, Walmart and the Internet offered better deals. In other words, they weren't even competing when they were in business. If they were offering a decent alternative they'd have been able to get enough customers to stay in business. If anything this just forces Circuit City's few remaining customers to wake up and realize what everybody else already knew: better deals can be had else where.
And I wouldn't worry about Best Buy becoming a monopoly. There's still Walmart, Target, Fry's and Ultimate Electronics. And then there's the Internet with hundreds of websites competing against Best Buy and each other.
Parent
Re:Really? (Score:5, Insightful)
Oh, you need the competition between the brick and mortar stores? OK. So, how do we guarantee that? Punish the big stores with higher taxes and give tax incentives to the smaller ones? Bail out failing companies? Companies fail for a reason. CC wasn't providing sufficient competition to BB. To make it worse, they were terribly mismanaged. If they had declared bankruptcy earlier, they might have still been in business. If they hadn't gotten rid of their best salespeople, they might not have gone bankrupt in the first place.
Parent
Re:Really? (Score:5, Insightful)
The real problem is that unless you are looking for a very mainstream part your local shop probably doesn't carry it or is out of stock. Sometimes this is true of even very basic stuff, and the big box stores are rarely any better than the independents (the worst of all is, of course, Frys). It's surprising that the B&Ms don't understand that the ONLY reason anyone does business with them is because we want/need something RIGHT NOW, but they clearly don't.
My canonical example is Central Computer, which has a reasonably convenient store in the City two blocks from a bus stop. They're local and I really want to like them despite their Taiwanese sketchiness, but they never have what I want. Wifi router? On the web site but not in stock. SATA disks? They have hundreds of the desktop grade one in stock but the enterprise grade are on backorder. A case? They'll have to have it shipped in from another store; maybe 2 days. The last time I was there I spent a lot of time wandering around just to see what they DO stock. What I learned is that there are plenty of USB cables, CPU fans, about 2 dozen of a single model of 24-port 100Mbit Ethernet switch, and single display case boxes of just about everything from graphics cards to parallel ATA controllers (I guess for emergency repair of those boxes you bought in 1998). It's anyone's guess how many of them are actually available for purchase, but I'm willing to bet that the one you want isn't.
This is exactly the sort of reason B&M retailers are doing so poorly. Circuit City of course had its own company-specific problems, but the problem is much bigger than any one company. The bottom line is that there are only three differences between B&Ms and Internet retailers. Two of them work for the B&Ms: in-person sales and service, and instant gratification. The third works against them: the difference in cost per square foot between a retail storefront in the City and a warehouse in Fernley, Nevada. In order to stay in business, B&Ms need to put their two advantages to work at least well enough to offset the differences in their cost structure. Circuit City clearly failed at the service side of things; I don't know how good their selection was but if they're anything like Best Buy they probably failed there too (I don't need 3000 square feet of CDs; this is a bloody electronics shop, not a record shop!). Other B&Ms will all go the same way unless they wise up and start using their differentiators to win business. Head-to-head competition by doing away with in-person sales and service and stocking only a few items in a space clearly focused more on promotion and hype than selection isn't going to win my business, and I doubt it's going to win yours either.
I really really want to like B&Ms but they are forcing me onto the Internet for just about everything but food. We are all Just In Timers now.
Parent
Re:Really? (Score:5, Informative)
Very insightful post, but I'm wondering why you call Fry's "the worst of all". The Fry's near me, unlike most B&M stores which have horrible selections of computer equipment, usually (I haven't been there in a while) has a very good selection, amazing actually compared to a typical BB or CC. You want a CPU, memory, case, etc.? They have lots of them. They also have weird parts, like laptop-to-desktop IDE converters, and also lots of electronics stuff like soldering stations, oscilloscopes, components (at a high markup of course), big spools of CAT5e cable, etc. Their prices really aren't that great compared to Newegg of course, and to be honest shopping there is an ordeal unless you like noise and chaos and annoying salespeople (they also have a horrible location in my town: Tempe, AZ. It's right next to Guadalupe ("Little Mexico") and is a great place to get your car stolen), but if you really need 1000 feet of CAT6 cable and connectors and a crimping tool, and you need it today, Fry's is the place to go.
Parent
Ya pretty much (Score:5, Insightful)
I quickly had written it off my list of places to go when it was in business and hadn't been there in years. When they were shutting down, I figured I'd go and check to see what kind of deals were available. Answer? None that I could find. Most things were no better than retail, I could go to Best Buy and get the same price. Oh sure they were "marked down"... but they'd been marked up first. There were a few things I saw that were lower than you might see in most brick and mortar stores, but not by much and not any lower than you'd find online.
I never understood why they thought that their high prices were sustainable. I mean I understand that retail stores charge more than online. No problem, you are paying for the convenience. However they charged more than other retail stores. Well guess what? I can drive to Best Buy just as easy.
Also you can justify higher prices with better service/experience. Some high end AV shops are like that. The prices are high, even when you consider the gear they sell (which is already very high priced) but the service is top notch. You can spend hours milling around, trying out things. They have knowledgeable people who will answer your questions and such. Thus you are willing to pay more.
Well CC didn't have that, at least not the ones I'd tried. Their sales people didn't know shit and were rather pushy.
Ok so if you aren't going for the service, and aren't going for the price, why go? Well the answer to that question for me and apparently many others was "you don't." Thus they are out of business.
I feel bad for their employees as this is not a good time to be looking for a job at all, and probably doubly bad looking for a retail job, but I do not feel bad for Circuit City. They were a crap business, and that's the whole idea in a capitalist market: You run a crap business, you fail and are replaced by someone better. Best Buy is by no means perfect, but they are better than CC.
Parent
Re:Ya pretty much (Score:5, Interesting)
The Circuit City near my house had those great big "Going out of business, massive discounts" signs up, so I decided to go inside and take a look.
There was nothing I couldn't find for cheaper online, even including the price of S&H.
I was quite surprised, though, to find some plain, 256 MB sticks of PC133 SDRAM (you know, the stuff that came before DDR). It was some plain Circuit City branded stuff. I was mildly pleased to see that that Circuit City catered to people with old computers.
Then I saw the price tag. They were trying to sell it for $109.
One hundred and nine dollars. For technology that's fifteen years old, and has been mostly obsolete for the last five.
What the fuck.
I was so appalled by this that I actually asked one of their sales associates why they were charging such an unreasonable price for obsolete hardware. He responded in true Slashdot fashion, with a car analogy: "It's like the way people pay lots of money for an old car - it's old, but good!".
So yeah. They're going out of business because, apparently, nobody there knows anything about anything.
Parent
Re:Really? (Score:5, Insightful)
Then over time, other companies started accepting returns for any reason as well. The gimmick of "matching your competitor's price" stopped bringing in as much traffic. People in the US aren't actually willing to pay for good service, so the service quality started to decline, and they failed to keep up with their competitors.
But back in the day, they were really innovative (well, as innovative as one can be as a chain retailer).
Parent
Great place to work (Score:5, Funny)
I remember in the early nineties when the Circuit City car audio installation department employed all those otherwise out of work recent EE grads. Good times.
Where do EE majors work now? The wife is looking for work.
Re:Great place to work (Score:5, Funny)
Clearly, you jest. You really expect us to believe you are married and you read slashdot?
Believe it or not, even geeks can get married. Slashdot has been around a while now and the demographic is getting older.
;)
This has resulted in something akin to sublimation [wikipedia.org]; many Slashdotters have gone straight from not getting laid because they can't get a girl to not getting laid because they're married.
Parent
Re:Great place to work (Score:5, Interesting)
Okay, so I know I'm sticking my neck out here by admitting this on /., but I work at Best Buy. I can also say that no one in a Best Buy store below a supervisor position has any fear of losing their job any time soon unless their store is SEVERELY under performing. Maybe it's not the whole company, but I'll tell you at my store if a supervisor wants to fire someone and goes to a manager (since a sup can't fire an employee) the first thing the manager will ask is what the sup has enacted to correct the behavioral issue with the employee. We're not graded on magazine subscriptions and haven't been for a year+ and even then it was only cashiers that ever were (not salespeople) and I doubt anyone actually got fired for it. As far as selling the service plans, we have periodic corporate memos going to all employees that care to read them saying that the service plan is not for everyone and that our job is to let the customer know they have the option, not that they have to have it. Sure management would like you to try to sell it and show the value in the plan, but no one CAN get fired for not selling a service plan, let alone actually does.
Say what you will about the customer experience but don't claim the employee experience is something it's not.
Parent
Re:Great place to work (Score:5, Funny)
Parent
Re:Great place to work (Score:5, Interesting)
You haven't worked at Best Buy long enough to know better.
I worked at a Best Buy back in the late 90's and early 2000's, eventually becoming the Senior product specialist in the Computer department. The service plan USED to be pushed VERY hard. We were graded on the percentage of overall revenue that was service plans. I remember being told by MANAGERS, not supervisors, that if some customer didn't want to buy the $220 service plan with their $2000 laptop, that I should discourage them from buying it, or try to get them into a cheaper one. We learned all the tricks, what to point out that looked fragile or otherwise likely to break due to "normal wear and tear", etc.
It was always a big deal that we weren't supposed to "inboard", which meant reducing the price of something in order to get the customer to buy the service plan. But the unwritten rule was to not get caught doing it, since reducing the price to include the service plan both got the sale and increased the percentage of the sale that was the service plan.
This may sound really weird to you now, but back in the day, we'd set people up with the computer, and staple the service plan 8.5x11 trifold brochure to the - what's it called, the 3 part carbon copy paper they use to change prices. Anyway, the brochure used to have a blank square on the bottom of the back page, where you wrote in your employee number. Even though there was no commission, they kept track of individual performance, and would use that in your performance reviews, etc.
It's gotten better. When they refocused (after i left) on making the sale and getting the revenue, it became a more pleasant place to shop.
~X
Parent
Was decent, once upon a time (Score:5, Interesting)
Years ago, when I first moved to California, I had never seen a Circuit City, only Best Buys (and was suitably appalled by BB and business practices, they tried a bait and switch on me once).
I found the Circuit Citys I saw to be clean, maintained, decent prices, friendly employees. But then, a few years ago, I noticed a reversal taking place - the CCs near me had become, for lack of a better word, 'ghetto' - unfriendly employees, broken equipment on display, and lack of product - while the Best Buys had cleaned up and trained their employees. I switched back to BB, occasionally walking into CCs, and finding them just getting worse and worse.
Re:Was decent, once upon a time (Score:5, Informative)
That's because they fired all their employees and offered to rehire them at a lesser wage [signonsandiego.com]. Some Exec somewhere decided that 'knowledgeable' and 'trained' employees were stupid for the kind of job CC did so lets replace them with some HS kid off the street that doesn't know a thing.
The ONLY reason I set foot in a brick and mortar store is to feel in my hand what I'll be buying online. I did it with my Rebel XT before I pulled the trigger on an awesome online deal.
Best Buy and Circuit City have both appalled me as of late with the prices of their cables. $30 for a 6' USB cable? Sometimes if I know I'm going I'll take a MonoPrice print out and stick it up by the cables.
I have to wear headphones when I go in too because of the insane amounts of stupid spewed by the staff. On more than one occasion I've corrected something they were telling some poor soul.
Parent
Re:Was decent, once upon a time (Score:5, Informative)
If you hate it now, you're gonna get to hate it even more in the future ... Bell wants to buy 'The Source by Circuit City' [cnn.com] so they can pimp their crappy sympatico and bell mobility brands, screwing their franchisees in the process.
Sounds like a marriage made in heaven. After all, there's no love lost for BCE either.
Parent
Dibs! (Score:4, Funny)
I call dibs on the lady that worked in printers.
they cant even go out of business right (Score:4, Informative)
here in washington they couldnt even go out of business right!! The prices at 40% off were either the same as best buy or more!!
Overheard (Score:5, Funny)
and were therefore selling off stuff like broken computers and the toilet-paper dispenser from the restroom
At the checkout:
"You know, I've got a couple of these toilet paper dispensers, and they always seem to jam at the most inopportune times. Could I interest you in purchasing our exclusive 5-year extended warranty protection plan for only $179 more? It would really give you more peace of mind in the bathroom."
What took so long? (Score:4, Insightful)
Circuit City was dead to me when they lauched their DIVX plan back in the late 90's between that and their jacked up warranty policy (back then if you returned an item that you had purchased an extended warranty for, they pocketed the warranty fees) I had vowed never to step foot in one again. I managed to steer free from CC until a few months ago when I went by the local one to pick over the corpse during its going out of business sale.
They didn't know who they were competing with (Score:5, Insightful)
Even in death they sucked (Score:5, Insightful)
Even under liquidation they were selling their stuff for maybe 10% off. I can't tell you how many I watched walking out and telling each other "This is why they're going out of business..."
Re:Even in death they sucked (Score:5, Interesting)
Actually that sort of thing is handled by the liquidation company and in no way is set by the former Circuit City management.
Basically, as in all liquidation sales, they put everything up to MSRP, then take 10%(or whatever the starting discount is) off. Chances are you'd have gotten a better deal the week before liquidation began.
Parent
Re:Even in death they sucked (Score:4, Interesting)
I agree. I went in there a couple of weeks ago to see if there was anything worth buying. Even with all the discounts I couldn't find a thing. I was actually in the market for a keyboard - for which I would normally pay $0-$5 - and couldn't find anything under $50. They were selling 500G hard drives for more than it cost me to get a 1T drive months ago.
In general, retail prices suck - but retail stores do offer you the opportunity to try products in person. What we need is some hybrid model, say for example an Amazon store.
In such a store they would have many products on display or people to answer your questions about them, and for books they could have ebook readers and comfy sofas to let you browse most of their selection (most of it is print-on-demand anyway so they could do this), but there would be no need for the warehouse at the back for stock. You try things out there and order either there or at home, and a few days later your item is delivered.
There is of course no guarantee that people would actually buy the product from Amazon rather than anywhere else, but by providing such a service the company would gain goodwill, and they already manage that a similar risk when it comes to their review system. If a company makes it really convenient for you to figure out what you need, and they provide you the option to buy at a reasonable price, most people will buy. Companies like Amazon already provide that to some extent, but you can't try the product unless you find a retail store that carries it. And those are dropping like flies.
Places like circuit city make it easy for you to believe that what they want to sell you is the thing you want, and they give you the option to buy at an unreasonable price. That's a lose lose scenario.
Parent
Another perspective on the closure (Score:5, Insightful)
"I am writing this message in representation of the employees of Circuit City here in Richmond who are having to deal with inexcusable conditions being brought on by customers with retribution. Walk into any Circuit City store on any given day and you will find a handful of employees and a sea of customers. The fact that people have flocked to our stores en masse on a daily basis, creating Black-Friday style crowds, has been insulting to our employees and our business alike.
Where was this support when we needed it? Liquidation, for us, has brought great havoc on a series of levels. I've been working for the company for almost two years, and I have never seen anything worse than I have seen over the past month. Customers have gotten enraged over the fact that our discounts aren't good enough for them."
While I only shopped there if I wanted something *now*, I did go in once the closures were announced and you could see people loading up on stuff just because it was some % off. I never saw anything that I couldn't get a similar deal online at the time (and also came with warranty) so I couldn't understand the why people descended on the store en masse. The only explanation I can think of is a feeding frenzy brought on by greed. So from that perspective I can understand where the letters author was coming from
What do they expect? (Score:5, Informative)
1) customers do not owe businesses "support", If a business treats their customers with courtesy, good service, and respect for their intelligence they will earn customer loyalty even in bad times.
2) Customers tend to get outraged when they hear about 40% off sales and then go in and see that the 40% off item was marked higher than it had been the week before the sale started. Its not a matter of "didnt get the discount they wanted" its a matter of being suckered into a store and having their time wasted.
3) Their customers didnt kill their store, their bosses did. They shouldnt blame their customers for simply looking for an honest bargain.
Parent
Re:Another perspective on the closure (Score:5, Insightful)
What a stupid letter. The author complains about crowds in their store. How do you think they got there? Perhaps it had something to do with their company advertising amazing liquidation deals.
And then the customers take time out of their day to travel to CC to get these amazing liquidation deals, and there are none.
So they get pissed, asking where the great deals are.
Please indicate the point where you consider this to be a departure from completely rational behavior.
Perhaps blaming the customer instead of mismanagement is part of the reason you're going out of business.
Parent
A sad day (Score:5, Insightful)
It was a sad day when Enron closed its doors after making horrible management decisions that cost their employees, customers, and the general public billions. But curiously enough, nobody ever blames management. "The market is bad." Yes, the big bad evil market -- tell me, even in a recession or depression, does the market for electronics suddenly disappear? No. It might shrink, but a business that's properly built will shrink with it, not simply die off. A corporate mass-extinction like this has only one cause: Bad management. Period.
Never liked CC stores (Score:4, Insightful)
I never put much stock into the psychological games retailers play to get you to buy products until I went into a Circuit City. Whoever they got to design their stores obviously didn't understand what makes people feel at ease and happy. Every time I stepped into a CC, I couldn't wait to get the hell out. Something about the layout, the ceiling, and/or the lighting just made me feel uncomfortable. Then on course, you had the staff. When you wanted help, they were no where around. When you wanted to be left alone, they came in droves.
I admit their online->in store pickup functioned much smoother than Best Buy's.
The Real Reason Circuit City went under (Score:5, Funny)
History Of CC...By someone who was there for it (Score:5, Interesting)
Having an extensive memory like I do and also having lived in Richmond many years ago and then most recently; I feel I have a pretty damn good over view of the whole fiasco. The problem was with management. The problem was with management every single step of the way.
When I was a teenager, Circuit City was THE place to buy anything electronic. Why? The salespeople worked on commission so it was in their best interests to know what they were talking about. You could stand and talk with them for however long it took and the lions' share of them knew what they were talking about in every aspect of what you were considering buying. The service was so good that people used to refer other people to the salesman that had helped them by name.
I can remember CC winning design awards for stereo eq that came out on occassion as well as many other things. At the same time, their return policy was bar none, the best you could get anywhere. So what happened?
First, management decided they wanted a larger chunk of their employees pay. To that end, they cut all the salespeople and offered them entry level wages on a per hour basis. Almost immediately, the good sales people left. They moved on to greener pastures. Instead of walking in and talking to someone who knew what they were talking about, you got a teenager who was more concerned with who he or she was going out with on Friday night. Not that there is anything wrong with teenagers, I used to be one too. But, a teenager making minimum wage is never going to be able to compete with someone who lives and breathes whatever the product is that they are selling.
Next came the elimination of the large appliances. Who is honestly going to buy a washer and dryer from a 16 year old kid? You see, when people realized it was kids in there, the high dollar purchases ended. It ceased being THE store and became a store...like so many others. As many of the commissioned sales people left, many of the management also left. What they were left with was a company with salespeople who did not understand what they were selling along with a management team whose understanding of technology was "It's the next big thing!"
In a mad dash to recoup the losses generated by idiot management, they turned to many deals that were ill advised at best. The most glaring of these was the DIVX support. They tied almost all of their fortune to Toshiba and in turn provided the buffer zone financially if the whole thing fell apart. As we all know...Americans like to own their media (we can argue about that later).
When DIVX collapsed as everyone who knew anything about formats knew it was going to, CC took the brunt of it. Then as we all know, the dot com boom blew out and that was it. One of my favorite incidences that occurred was about 10 years or so ago, you found out you had been laid off on Monday mornings by a sign on your desk. If your stuff was in a box and there was Kleenex next to it on your desk and a security guard in your department wandering around, you were laid off. You can only do that so many times to employees in your headquarter town before you hit a point where noll amount of advertising is going to save your company from bad press.
But, time had moved on and Best Buy had shown up on the sidleines and was edging their way in. BB opened stores that were clean and bright and made their fortune off of friendly helpful people who knew what they were doing. As CC began to circle the drain, more stores closed, more layoffs took place, items got cheaper and their price went up. Where at one time in CC you could walk in and buy just about anything for a great price and have your neighbors over and have them oohh and ahh for the next three days; now, it was a shady looking place where you kind of expected someone to offer you 'grey market' items in a dark corner.
They never dropped their prices after they stopped paying their commissioned salespeople. In many ways, CC was THE MOST EXPENSIVE place to buy something. Yes, you
The American Dream Does Not Come True (Score:5, Insightful)
Action: Remove staff with knowledge and ability and start paying less to less capable people.
Reason: Keep immediate profits high.
Outcome: Reduced sales due to less customer service.
Action: Leave prices high.
Reason: Keep immediate profits high.
Outcome: Failing to see that the consumer electronics market is shifting to a Walmart model (aggressive pricing, low profit, high volume) sales go down.
Action: Eliminate deep discounts on open box, out of production, or discontinued merchandise.
Reason: Keep immediate profits high.
Outcome: Reduced repeat and casual traffic resulting in reduced sales.
This is what happens when any business runs itself based on the principle of "Keep immediate profits high" rather than "Keep customers coming back".
Gordon Gecko was wrong - greed is bad.
Awesome store (Score:5, Funny)
Yeah, I went in there yesterday for the sale. Got a pretty sweet deal on a Divx player. Anyone know how long the "waiting for server" screen takes?
RIP (Score:5, Interesting)
I think there are several poor business decisions that the company made in the past 10 years or so that can explain why they failed. Starting with their venture into the DIVX fiasco [wikipedia.org] (hint: if your "partner" in a business venture is a law firm, it's probably one to avoid). They probably could have recovered after they finally killed DIVX, if it wasn't for also deciding to get out of the major appliances business. Talk about pure stupidity there -- you see, most major appliances customers are older people, homeowners, with money, and while they're buying that refrigerator or dishwasher today, in six months, they'll probably be looking for a new wide screen television or laptop. Getting rid of appliances just eliminated a huge segment of the market, and lots of sales!
Mistake #3 was just simply not figuring out your basic store structure. After I left the company, every time I walked into the store, I swear to God, they had a new format and arrangement! I could never find anything! If you can't figure out something as simple as this, you're doomed. Going along with this, Firedog was simply at least three years too late in responding to the Geek Squad -- Best Buy won that one easily.
The final nail in the coffin (and I'm sure this has already been stated in this thread somewhere, but I'll put it here just for my own completeness) is firing all of their experienced salespeople and replacing them with non-commissioned, inexperienced, Wal-Mart-esque, clerks. I do understand that ultimately, they had to ditch the commissioned model, simply because of the change in the marketplace. But they went about it totally wrong -- a better solution would be to take advantage of the high turnover rate in retail as it is, and just not hire new commissioned salespeople, and grandfather the experienced ones, who can then be a huge resource to the newer salespeople in teaching them the ropes.
So, it's sad to see them go, but not surprising based on their business decisions of the past 10 years. I did learn a lot from working there back in the 90s, especially regarding computers, installations, and technology in general, so I thank them for that. In the meantime, I guess I'll get my electronics from Newegg [newegg.com] or TigerDirect [tigerdirect.com]. At least until some new entrepreneur decides to open up a Buy More [nbc.com],... ;-)