Circuit City Reschedules Black Friday for This Wednesday
by John Paczkowski
Posted on November 3, 2008 at 10:26 AM PT
Black Friday, the beginning of the traditional Christmas shopping season, will kick off far earlier than usual this year, thanks to Circuit City (CC). In the aftermath of a particularly nasty second-quarter loss and a 95 percent decline in share price, the long-suffering electronics retailer said today it is shuttering 155 of its stores across 12 U.S. markets and sacking 17 percent of its domestic workforce. At last count, Circuit City employed some 43,000 people. So the cuts could send some 7,300 workers to the unemployment office just in time for the holidays.
Awful, ugly news. That said, there is a silk purse to be made from this particular sow’s ear. Store closing sales begin on Wednesday, so this is an auspicious time for the employed to get a jump on the annual holiday consumer binge. Those who aren’t put off by this near-funereal assessment of the economy from Circuit City’s acting chief executive James A. Marcum.
“Since late September, unprecedented events have occurred in the financial and consumer markets causing macroeconomic trends to worsen sharply,” said Marcum. “The weakened environment has resulted in a slowdown of consumer spending, further impacting our business as well as the business of our vendors. The combination of these trends has strained severely our working capital and liquidity, and so we are making a number of difficult, but necessary, decisions to address the company’s financial situation as quickly as possible.”
Happy holidays, huh?
Circuit City shares are currently trading at around 38 cents.
Comments
circuit city was running out of cash months ago. with credit markets dried up it had nothing else to do, except 2 options:
1) close stores asap and renegotiate leases
2) file bankruptcy
cc blew it when they laid off their talented sales staff in order to “boost margins”
it worked for a quarter and then backfired as customers were greeted by know nothing sales staff
Posted by Sam Harrison at November 3rd, 2008 at 1:41 pmp.s. instead of your photo above crossing out “open” just highlight the words: “we’re dust”
Posted by Sam Harrison at November 3rd, 2008 at 1:42 pmIt’s interesting to me, as a MN resident, that Circuit City isn’t closing any stores here in Best Buy’s backyard (the BB headquarters is just down the street).
Posted by Peter Callies at November 3rd, 2008 at 2:46 pm