Screwing workers doesn’t pay in the end
A while ago I wrote about a stupid move Circuit City made regarding its veteran sales workforce.
The company decided last year to fire 3,400 of their highest-paid clerks and replace them with workers who would take less money.
My story sparked quite a bit of outrage in the blogesphere against the electronics retailer, and almost every analyst called it a dumb business decision that would take a bloody bite out of employee morale and also create a crummy shopping experience for customers.
But Circuit City management stuck to their guns. So what was the outcome?
It turned out to be a bust.
This from the Associated Press today:
Circuit City Stores Inc. is considering closing at least 150 locations and slash thousands of jobs to avoid filing for Chapter 11 bankruptcy protection, a report said Monday.
A report in the Wall Street Journal said people familiar with Circuit City’s plans said the store closings and job cuts could allow the retailer to liquidate $350 million in inventory that could be used to pay real-estate costs, including leases on abandoned sites. Circuit City, the nation’s second-largest consumer electronics retailer, could then try and renegotiate leases with existing landlords, the report said.
Surprise, surprise. Trying to create a third-world workforce in the Good Old USA doesn’t garner a lot of customer or employee loyalty.
Maybe they should hire back those former employees, the ones management thought were grossly overpaid at $8 to $15 an hour.
October 20th, 2008 at 11:54 am
Lesson from business 101: Don’t get rid of seasoned personnel who generate the most revenue in the name of saving some payroll dollars. If you do, you’ll cripple your sales efforts and hurt the bottom line. If you suspect some highly-paid staff of coasting on a high wage/benefits package, consider modifying compensation for those employees who are not meeting minimum sales/productivity targets.
Of course, that only works if the metrics allow for the fact that the seasoned folks may see their sales drop if they are assigned to help train in new staff to replace the few who will bolt at the thought of prodcutivity-based pay/inducements.
October 21st, 2008 at 12:39 am
Ya think?
The management team is off the rails on this one. If you were working for them, why would you want to help them survive?
October 21st, 2008 at 8:32 am
Gosh I really hate Curcuit City. Best Buy kicks them to the curb anyways!
Jiff
www.privacy-center.be.tc
October 21st, 2008 at 8:32 am
When they announced the firing of salespeople I stopped going to Circuit City and went to the competition instead. I haven’t stepped inside a Circuit City since.
Management types in this country have never learned the value of an employee. They see them as liabilities rather than assets, opponents rather than partners. . .
October 21st, 2008 at 8:45 am
Did you bother to think that maybe they were in trouble when they started the employee cuts? Many times that is what will spark the cut in employees, not necessarily the fact that the CEO and Exec’s want more money.
October 21st, 2008 at 8:47 am
Not that I think Circuit City laying off their veteran employees was a good idea, but nothing in your article definitively attributes the potential bankruptcy with the firing of the more seasoned employees. For all we know keeping those higher paid employees would have accelerated this downsizing. All I’m saying is at least make some effort to support your premise instead of just making some conclusory remarks.
October 21st, 2008 at 8:48 am
The two actions are not related. If they fire more workers, they may save enough money to keep more stores open.
:)
I have never bought anything in their stores just because of their sale rep.
October 21st, 2008 at 8:49 am
just wanted to say that the logic of the blogs author doesn’t make sense. she doesn’t show any link to the firings a year ago and them scrambling for chpt 11. perhaps that’s the case but the “evidence” cited doesn’t even hint towards that. now i’m not big on retailers but it’s sloppy/poor critical thinking skills that puts half witted ideas in peoples heads and i can’t stand that. build your argument around the facts don’t make the facts fit your arguement otherwise then you’re no better than the democrats/republicans/executives/boardmembers. (i mean they are one and the same pretty much). also a conclusion one could draw from the cited material is that had cc kept those 3400 seasoned employees they would have to file for bancruptcy and probably couldn’t do the quick reorganizing they’re doing now. for this you don’t need business 101 but instead plain old critical thinking/debate 101.
on a final note lemme just say this: break the mohawk valley formula ie worry about wealth forgetting all but ones self.
October 21st, 2008 at 8:49 am
Everyone is experiencing loss at this time. To attribute Circuit City’s losses to those employees is asinine. Businesses everywhere do that and more.
Suck it up and get a new job!
October 21st, 2008 at 8:52 am
I haven’t gone to CC for years. Why?
-sales staff is not knowledgable
-prices are not competitive
- and now bad PR - the word is the company doesn’t care about its employees or its customers.
So I don’t give a damn about CC. Garbage in, garbage out. Why don;t they just close and quit uglifying the landscape?
Try something else, and get it right next time.
October 21st, 2008 at 9:02 am
I like circuit city, thier items are way cheaper than best buy
October 21st, 2008 at 9:13 am
CC does suck, and their staff no nothing to help you most of the time. It’s like Game Stop, one of the managers there used to work at Sally’s Beauty Supply….seriously. But back to CC, not only does their staff suck, their stores inventory sucks you could go to Wal Mart and get the same things.
October 21st, 2008 at 9:13 am
I think this article is misleading and misinformed. Essentially, it’s saying that by taking steps to reduce labor costs, it hurt the company. It’s possible that the company was hurting before the layoffs and by doing the layoffs, they were hurting less.
However, it’s possible this article could be correct as well - perhaps the layoffs of their top performers killed the company.
It’s hard to say without getting the full picture.
October 21st, 2008 at 9:19 am
No surprise here if you have worked in stores like this before. I’ve worked for both Compusa & Staples… both are now gone where I live.
Bye Bye Circuit Sh!ty… Companies that keep you under 38 hrs to avoid health care & under 10 bucks an hour need to die off… It just isn’t right,period.
October 21st, 2008 at 9:29 am
Unfortunately it looks like Circuit City is headed for bankruptcy. I wonder why the Board didn’t remove the CEO sooner?
http://blog.sekiur.com/2008/10/circuit-city-on-thin-ice/
October 21st, 2008 at 9:31 am
I was appalled when CC fired all their employees and replaced them with lower priced versions. I used to be a fairly regular customer of theirs but after the mass firing I was no longer. I knew at the time they were getting what they paid for…cheap, inexperienced help with absolutely no loyalty. A good recipe for bankruptcy.
October 21st, 2008 at 9:34 am
Getting rid of your top producing sales people almost always months later, eventually produces a sales drop unless you have hot products your manufacturing. Since CC is a retailer and not a manufacturer they have no hot products.
The few times I went to CC I did not like their store, and I have not been to CC in the last couple of years.
October 21st, 2008 at 9:38 am
As much as I am for unions and for American jobs that can pay for mortgages and families rather than shared apartments and video game consoles, I have to object to the reasons stated here. The reason isn’t the lack of high commission salespeople who can generate sales.
The reason is that a lot of customers are able to get many of the same electronic goods at much lower prices from Best Buy, Fry’s, Costco, Wal-Mart. As for high-commission items like high-end stereo and big screens, there are big screen specialist stores, for example, that carry more inventory variety to attract shoppers, have specialist staff, and can afford to sell cheaper due to volume. That kind of operating environment means that Circuit City’s model became obsolete.
They tried to change, but they couldn’t become like Best Buy fast enough, morale was down and their real estate leases were crippling them.
October 21st, 2008 at 9:40 am
You’ve gotta be kidding me praising Best Buy. Check out consumerist.com about their SHADY business practices. Example: BB absolutely loves to offer mail-in rebates. But what you probably don’t know is this: BB implemented a policy that only permits one mail-in rebate per customer address. So if you bought a DVD and redeemed your $5 rebate in…say, 2004, then walk in tomorrow and buy a DVD player with a $40 mail-in rebate and list the same home address as the previous rebate, you won’t get your $40.
It has been well-reported about their troubles with fraud in regards to pricing on their website.
Add to that Best Buy’s “3 employees sitting around talking about last night’s 24 episode and are ‘unavailable’ to help customers” mentality, I will take my business elsewhere.
October 21st, 2008 at 9:43 am
With the economy being the way it is (yes i realize this is a broad statement). As chris stated perfectly: “Everyone is experiencing loss at this time.”… Excuse me for taking this out of context for my own thoughts, but it seems catch 22 to me. Circuit City could have kept these employees and maybe with their experience held on (doubt it) but risk bigger pay rolls. But when you fire them and rehire less for less, then you clearly are putting your own nails in your coffin. Those less experienced sales clerks and other personnel really do make a difference, which I can say having worked in retail in the past. With those new clerks, they had no chance of getting enough sales with a complete team of inexperienced workers.
All in all, they were doomed to fail in my opinion. Honestly I can’t remember the last time I’ve been to a Circuit City with the ever popular Best Buy and all the internet bargaining i can do these days.
October 21st, 2008 at 9:45 am
CC has always felt sub-par.
Sort of like the feeling you get from K-Mart after going into a Target. Just, a weird film of dirt envelopes the entire store and you feel sleazy for stepping foot into there.
October 21st, 2008 at 9:51 am
I agree that firing veteran workers isn’t necessarily a good idea, but how does this demonstrate your point? How do we not know this wouldn’t have happened with or without veteran employees?
October 21st, 2008 at 9:51 am
Circuit City’s layoffs of veteran workers is not necessarily the cause of the company’s filing for chapter 11 bankruptcy. It may be a sign of how the company was doing financially as payroll usually accounts for the largest share of the budget. You’re finding cause where there may not be correlation.
October 21st, 2008 at 9:55 am
Unfortunate another electronics retailer has gone, but hardly uncommon. I have to agree the evidence linking the firings to the ultimate decline of the company is nonexistent, even if the premise is emotionally appealing.
To those suggesting this is a good thing, remember that a decline in competition is rarely beneficial to the consumer. Essentially Best Buy or whoever will now be able to increase prices or decrease service levels a bit more without fear of losing as many sales.
October 21st, 2008 at 9:57 am
I worked next to a Circuit City before the firing of experienced employees. I knew several of the salespeople, older guys who knew their stuff and liked helping people get what they want and also make money doing it. Now the place is staffed by kids who basically chat with each other and you have to interrupt their conversation to get something.
I wonder if the executives of Circuit City had ever thought about thinning the ranks of top management? Surely getting rid of a bunch of VPs who come up with the asinine idea of firing your top salespeople would benefit from a herd-thinning.
October 21st, 2008 at 9:59 am
Large Corporations tend to make bad decisions based on financial gain, the relentless, unceasing, quest for increasing sales and profits. Often we forget that once a Company becomes a publicly traded stock market commodity, the store or institution ceases to have the human element of considerations other than purely monetary type. In essence there is no human “soul”, guiding the crucial decisions. The Corporation becomes purely profit orientated, the value of non critical workers becomes ever lower, and in steps “Mr Spock”, a Vulcan, always logical, and without human emotion becomes the accepted model for Corporate behavior. Paying dividends to the stock holders eventually becomes the sole purpose of the entity, other factors, such as human happiness, morale, and Family, are not given priority. Such an arrangement is bound to fail given enough time.
October 21st, 2008 at 10:06 am
Also intriguing to note the philosophical differences between Circuit City vs. Best Buy. The latter does “Results-Oriented Work Enviroment”. See: http://www.businessweek.com/magazine/content/06_50/b4013001.htm
October 21st, 2008 at 10:12 am
I work at two different circuit city’s in New Jersey.(one close to school during the school year, and another closer to home during breaks) I can say last years firings sucked. We lost many good employees, a few that did come back later to take supervisor positions and 3 awesome managers that got fired on the same day. Our inventory does suck alot of times, usually the sale items that we don”t get enough of, although it is no fault of the sales associates, they have no control over inventory, neither do most of the managers have alot of control. I don’t know what store you shop at but the two stores I work at have, for the most part, very knowledgeable sales associates that will help you with most of your problems, or if not at least go out of their way, if its not too busy, to find out the solution. We are not here to walk you step by step on how to set your network up, or give you lessons on how to do everything with your camcorder (although I usually help anyway). My point is, we are just paid to sell products and attachments so the customer gets more out of there product and maybe if we didn’t have as many cheap people always wanting discounts off laptops that we we’re already losing money on then ccity wouldn’t be quite as bad in financial trouble. Though I’ve been with the company for over 2 years and I make 10.35 now with a raise coming in a week or so, i’m interested in know what price range employees they will fire if they do so :/
October 21st, 2008 at 10:32 am
When will employers learn that employee satisfaction directly effects the bottom line?
October 21st, 2008 at 10:52 am
While I agree that firing their best employees wasn’t a great move, I don’t think there was anyway that they were going to avoid Chapter 11. They really had no chance to succeed and should have just cashed it in a couple of years ago. With Amazon and the rest of the internet, plus places like Walmart, there just isn’t a lot of room for brick and mortar stores like CC. In fact, there’s probably room for only one… for a while.
October 21st, 2008 at 10:56 am
Some of you are absolutely right, we don’t know if the firing veteran employees will eventually lead to the demise of Circuit City, but it clearly was a stupid business decision.
October 21st, 2008 at 10:58 am
Best Buy is no better.
In 2003, they fired 1500 employees from their corporate office, even though they were making record profits.
Shareholders > Employees Lives
October 21st, 2008 at 11:12 am
WTF? That is the worst logical leap I’ve seen in a long time. There are THOUSANDS of factors that could have affected Circuit City’s plunge. Take the poor economy for one.
You’ve provided no evidence whatsoever that there is a causal link between the store closings and the firings. Come on people, stop digging this stupid story.
October 21st, 2008 at 11:13 am
I was fired in 2003 along with any other sales person who made too much in commission. This makes me feel great. I always wondered how a company that was ran so poorly could stay in business.
October 21st, 2008 at 11:18 am
This is what corporations do when they want to raise the stock price and hold out more cash for upper management…
pigs.
October 21st, 2008 at 11:20 am
I agree with Chris that this story lacks evidence and actual research. This doesn’t however, change the fack that eliminating jobs is NEVER GOOD for us (Average Joe; assuming noone replying make millions a year).
October 21st, 2008 at 11:28 am
Yet again, targeting the wrong location for the cutting cost. If management makes a dumb decision like that, why is it they aren’t removed BY THE STOCK HOLDERS!!!
The larger paychecks up at the top, are suppose to have accountability associated. That’s why they are larger. The idea is there is more risk associated with the position. NOT LESS.
This is the same mentality that brought us the recent congress approved 700 Billion dollar bailout.
October 21st, 2008 at 11:34 am
“third-world workforce”?? You are greately mistaken and it does sound like too much of a stereotype. I have lived half my life in US and the other half in “third-world countries” and let me tell you that the salesmen are just as good if not better that their US colleagues.
October 21st, 2008 at 11:40 am
I don’t even know why circuit city is still around. The just finished building a new one where I live, and none of the people that work there are worth talking to. Most of them are just kids, or they’re hung over college students who really don’t care if you buy anything there. Nobody ever offers to help you unless you’re looking at something expensive. Best Buy is kicking their butts because their employees ask if you need help, and they seem to enjoy what they’re doing.
October 21st, 2008 at 11:51 am
Corporate America has evolved into something almost criminal over the last 50 years.
I am a conservative by nature and certainly am no social liberal but something has to change.
Corporations used to provide something tangible in return for the privledge of executives earning
a living far above that of the average Joe/Jane.
They provided steady gainful, long term employment for masses and provided defined benefit retirements program, that is, pensions.
Now employees are treated like animals and are the first to suffer when the equity outlook for executive stock packages become at risk. Also, the chump change thrown at 401K instead of pension plans does not come close to providing equality relative to stock option deals, especially when the employee is terminated early.
Companies are just tools for top executives to steal money, period….
October 21st, 2008 at 11:56 am
Circuit City was dying for years…
October 21st, 2008 at 12:05 pm
I’ve worked at CCity for over three years and when they fired all those vets, they fired about a third of my store. They replaced them with young kids and only paid them $8.25 an hour. I make over $13 and will probably be in the next batch of layoffs. But after everyone was fired people stopped coming in. They would ask for a sales rep they’ve known for years, we tell them what happened, and they just left. I mean, some of them were making $20-$32 an hour to stand around and stock CDs, but they were the ones that were there for the long haul. The new people have crazy turnover rates, don’t know anything, and don’t care. One more year of college and I’m gone, too.
October 21st, 2008 at 12:08 pm
sh’yeah… here’s a 100% true experience I had with circuit city just this past week.
I needed some speakers. They weren’t on sale, but since I read the consumerist, I know that pretty much you can get 10% off anything if you just ask nicely.
Well they weren’t having any of it. They wanted me to pay full (not even on sale!) price. So I walked out of the store.
On my way out, there was a manager of the store (according to his nametag, anyway… who knows) handing out flyers. I grabbed one, then said “you know why I’m NOT buying anything today? Because I KNOW you can take 10% off anything if you want, and nobody is willing to do it.” and walked out.
In the parking lot, I looked at the flyer.
15% off coupon for your next visit. NO SH*T.
THAT’S why circuit city is failing. It’s because their employees really don’t give two flying f*cks whether the company lives or dies. They wouldn’t give me 10% off when the coupons at the front of the store were for 15% off. If that doesn’t scream what’s wrong with circuit city, I don’t know what does!
(And no, I didn’t go back and buy the speakers. I bought them online for the same price as 15% off. Scorn me and you DON’T get my money, period!)
October 21st, 2008 at 12:12 pm
To the guy that complained about Best Buy limiting rebates to one per household…. When was the last time that you shopped at Best Buy? They haven’t done mail-in rebates in almost two years.
October 21st, 2008 at 12:50 pm
Hey Chris (#33), Circuit City was already fighting a downward trend when they made the layoff decision, and there are certainly multiple factors involved, but, in a business that derives the majority of its revenue by making sales, it makes no sense to get rid of those persons who are most expert in doing just that: generating sales.
Any corporate exec or manager with even a B.S. in business knows that it usually costs far more to train new employees than it does to retain existing ones. This is especially true in retail where turnover can be at a frantic pace (I know from experience–I’ve worked in retail management). I think Eve was right–the layoff of this particular group of employees was a dumb business decision–plain and simple. Was it the only thing pushing CC toward bankruptcy? No, but it has had a significant influence.
CC’s problems started way before the current financial crisis. While the state of the economy may be forcing their hand, it is not the factor that deserves the blame.
October 21st, 2008 at 12:50 pm
!!LOW IQ WARNING!! The bloggers logic seems to be faulty. She presents no evidence connecting the two facts and assumes that the point is made. :-/ duh!
October 21st, 2008 at 1:06 pm
Kids:
This contraction was designed with the company’s inception. Think Mel-Den, Silo, an Appliance Store. The affordable electronics giant is a stale decades-old yarn.
File it with cold-water energy.
October 21st, 2008 at 1:10 pm
Eff that–let’s go to Fry’s!
October 21st, 2008 at 1:13 pm
This is how shopping for electronics goes at CC, BB, Fry’s (not Bay Area locations), anywhere bricks and mortar really.
Customer: (Obviously reading box and looking at shelf tag)
Employee: Can I help you?
Customer: Do yo know if this supports USB 2.0?
Employee: Umm
Employee: (Takes another box off the shelf, begins reading it)
Employee: Umm
Employee: Let’s see
Employee: (Turns box around in hands)
Employee: Umm
Employee: Hmm
Customer: Yeah, okay, says right here that it does.
Employee: Oh, cool. Anything else I can do for you?
October 21st, 2008 at 1:30 pm
This didn’t work for Circuit City because salesmen were never their problem, it’s their high prices that make them fail. Anyone who comparison shops knows that anything you get at Circuit City can be found at Best Buy and possibly Target/Wal-Mart for substantially less cost. Salesmen don’t factor as anything but an annoyance to me. So they actually got it half right in dropping overpaid salesmen, but failed the next step of becoming competitive with their main competitors in price. Good riddance.
October 21st, 2008 at 1:45 pm
It’s called flushing the “corporate culture” down the toilet, and is always fatal.
October 21st, 2008 at 1:55 pm
I used to work in the computer department for Circuit City about 5 years ago when employees were still paid on a commission basis.
My hourly rate averaged over $22 per hour. They used to write people up left and right for small things. Now that I think about it, it made it easy for them to fire people since they had a record of “write-ups”. It would probably discourage an employee from considering a lawsuit since they would feel that they were in the wrong. I was fired even though I was one of the top sales people, or maybe because I was? I’m not sure.
The main reason that they were switching from commission to hourly was because they figured that Best Buy, who was starting to kick their butts, paid employees hourly, and were able to keep costs down and margins up, so it should work for Circuit City too. They were wrong because people expected to get service at Circuit City. Since then, they’ve tried to duplicate the look of the stores so that they would look more open and warehouse-like. It didn’t work. They tried changing their color scheme. Nope. They started Firedogs to compete with Geek Squad. No go.
I guess people just wanted good service.
October 21st, 2008 at 2:05 pm
They did this at the Sears store I worked at. The top appliance salesmen earned around 70-90k a year. These guys had been doing the job for decades, they knew everything about the products, they even had repeat buyers who would only by from them. Anyways to cut costs they fired them replaced them with a couple college students. The overall department sales went down, customer satisfaction went down. All in all a bad idea.
October 21st, 2008 at 2:33 pm
Circuit City filing for bankruptcy couldn’t have anything to do with, oh I don’t know, the worst economic crisis this country has seen in the last 75 years? Nope, must be that firing of them employees, the fact that CC, as well as hundreds of other retailers worldwide are filing for chapter 11 is purely coincidence.
October 21st, 2008 at 2:44 pm
Ironic that the people at the top, making the most overblown salaries on the payroll would attempt to cut costs by canning the top paid (and most productive) employees on the lower tiers.
BRILLIANT! Talk about earning that golden parachute.. *sigh*
October 21st, 2008 at 2:50 pm
Circuit isn’t failing solely because of the people that were fired over a year ago. Sure that may not have helped their case but look at any retailer’s profits over the past year or so. EVERYONE is doing poorly because we are in the greatest economic decline since the depression. Firing some seasoned associates (95% of which were not employed at Circuit when they were still commission)will not make your stock drop to where it is. What the company needs to focus on now is trying to win its consumer base back. Forget about shareholders and put us, the customer back as number 1 priority and hope we make it out of this shitty economy.
October 21st, 2008 at 3:30 pm
This is a typical slash-and-burn tactic of companies entering their dying stage. Happens all the time. Stockholders and their overpaid executives squeeze the guts out of payrolls and make a few extra bucks before the shit hits the fan.
October 21st, 2008 at 4:19 pm
As a former Circuit City employee, I can tell you that everyone at the company knew that this was going to happen when the layoffs were announced. When will retail stores like Circuit realize that their sales come directly from these employees? As a High School student, I was making close to $14 an hour but was FANTASTIC at my job. I constantly sold more than any employee in my district and made the company countless thousands of dollars because I was compensated to do so. What motivation exists for employees when they are told to meet the same demanding sales goals and paid just as much or less than someone flipping burgers at McD’s? The knowledge I had to know in order to properly sell computer and video equipment was immense, but I was constantly learning about every new product to serve my company and serve my customers. A company is successful when it realizes that those lowest on the totem pole generate the majority of profit and compensates those employees accordingly. RIP Circuit, you failed your shareholders and your employees.
October 21st, 2008 at 4:30 pm
American companies lay workers off because they know Wall Street will have an orgasm if the corporation fires workers or ever better, move the manufacturing facility to a third world country.
October 21st, 2008 at 4:47 pm
This had nothing to do with the sales force, stockholders, executive pay or any of that crap - it has to do with the economy and the simple fact that Circuit City stores in general fall WAY below consumer expectations on every level. In the stores I’ve visited, floorplans change every other week, are poorly stocked and prices are NEVER competitive with any other electronics retailer. I go in the store and ask to find a simple item and it takes three salespeople to locate it??? Then it’s twenty dollars more than what I could have bought it at Best Buy??? Circuit City closing? Good riddance!!
October 21st, 2008 at 5:12 pm
As a former employee of CC, I completely agree with this article. I worked for the company until 2003 when the employees were on commission. One thing that I loved about CC was that back then, you had to know the products that you were selling and you took tests on each item. All other companies that were hourly (BB and CompUSA), they couldn’t care less about you knowing the products.
I still remember the day (2002)that all the employees were called into the store and told by management that CC was going to hourly rates. We then were called in 1 by 1 to talk with the managers and we were either terminated or allowed to stay with an hourly rate that was based on the last 3 months. Not including the fact that the best workers worked more than 40hrs a week, so most were given less than what they actually made. They fired anyone who made over $15 an hour and kept the people who did nothing. Profits for our store slowly declined as customers came in looking for their normal sales people only to find out that they were fired.
They got what they asked for and have no one to blame but themselves. You keep the bottom-half workers to take the place of the top-half producers, it’s a customer service issue waiting to happen. CC gave me valuable tools in what I do today, but I stopped shopping there long ago because of the poor selection and the way the employees, and my friends, were shown the door.
October 21st, 2008 at 5:38 pm
Sears is sort of doing the same thing to their electronics department. They aren’t firing per say, but continually cutting commission rates. I don’t think this will bankrupt the company because they do more than just electronics, but at least expect a continuation of service quality to drop; getting people to give a shit costs money.
October 21st, 2008 at 6:51 pm
Frankly, I am motivated by price…and before I make a purchase, I first check the price at major online retailers (e.g., OneCall, NewEgg, Amazon) before I walk into a brick and mortar. In the cases where CC or BB could match the price, I would go with them for the convenience of returning the item locally if necessary…or because I needed something quickly and couldn’t afford to wait for delivery. Thus, service doesn’t normally rank that high for me as a criterion when buying. That said, BB has still managed to drop the ball for me in that area a number of times.
Example - I have made a number of major electronics purchases at brick and mortars over the last five years…including (off the top of my head) four large televisions, two laptops, and a higher-end receiver. In most cases, the prices at CC and BB were similar. While the selection at BB was normally better, CC usually also had the model that I wanted. I normally don’t go in browsing. I research first. Thus, I am mostly just trying to pull the trigger when I walk into one of these stores…and I have literally walked into BB to buy such an item and walked out empty handed *each* time. In all but one instance, I ended up buying them at CC. In the other case, I purchased the item at another brick and mortar…not BB.
Why? Believe it or not, service. Seriously…and I am just trying to pull the trigger on a purchase. I don’t need hand-holding. I am a software developer with a BSEE. I just need basic assistance. e.g., Do you have this model in stock? If not, is it available at another local BB? Can you match a price from retailer X. Can I use this coupon on your sale price? Not rocket science. In the past, CC was great in this respect. In contrast, even finding someone to help me at my local BB is often a challenge…and when I do manage to get someone to help me, they are often an ill-informed young sales person who states inaccurate facts…at times, with an arrogant air. Ironic, since many of these sales people appear to not have much more education than high school…if that.
In contrast, my past experiences at my local CC were great. The sales people were older, more professional, and better informed. Well, at least they lied less. Thus, I bought three of those $2K televisions at CC and both laptops…and the HK receiver.
Fast forward to present day - I recently purchased a large higher-end Samsung LCD television at CC…and thought that I was at BB. The young salesperson tried to talk me out of the purchase and push me toward a more expensive model, would not back off on the extended warranty upsell, and swore to me that a $150 Monster Cable brand HDMI cable would make a world of difference to my picture quality. I actually took the time to explain why that last statement was inaccurate and even quoted a recent study (and also explained what the D in HDMI stood for), but he would not back down. Yes, I suppose seven years of college and a BSEE pales in comparison to his expertise. Either way, he lacked a basic mature salesperson’s perspective of when to sell and when to back down and settle for the current sale in-hand.
Thus, my positive view of CC is pretty much gone. I do regret, however, that they are having hard times since that may end up stifling competition in areas in which the close stores…but that will just motivate me to buy more items online I suppose. I find that both stores have refocused so heavily on mainstream consumer devices that I often cannot find the specific model of a product for which I am looking regardless. I suppose that they need to chase their market…and an educated consumer is not it. Thus, I suppose their staffing now reflects that reality.
October 21st, 2008 at 7:02 pm
We can’t put up with this anymore. These chains and corporations will keep exploiting our hard work if we keep supporting them (buying from them, working for them, investing in them). It’s possible! We can do it, beautiful people!
October 21st, 2008 at 7:38 pm
ok so i work at a circuit city and this is fucking bullshit
my store has been doing amazing lately and thats because we teach our noobs how to bring in the money
if they kept only the good workers and not hired bad noobs who cant learn shit we wouldnt be in this situation.
but at leasst my store wont be closed!!
-chadtherobot
October 21st, 2008 at 7:44 pm
I worked at CC in Idaho Falls when they did the lay-offs. Not only did it hurt the business (many customers wondered where the old managers and sales people went, angry that the replacements were not knowledgeable) but they also changed the entire way the store operated. I was “offered” a position as the brand new “Tech/Imaging/Roadshop Supervisor. This new position was basically a management replacement, but with none of the benefits or pay. The old tech manager and roadshop manager were making triple what I was making. Then they told me that I was no longer eligible for my 6 month raise, and would not receive them again. All the responsibility and none of the pay. Needless to say, I quit.
October 21st, 2008 at 7:53 pm
I don’t think you can go out and claim that there is a causality between firing their veteran sales force and filing for chapter 11… it could be that they were well on their way towards chapter 11 and that firing these individuals allowed them to stay afloat for a bit longer. Or merely that the competitor was better and business went else where.. Not that i disagree with you, but claiming a causality between x and y without include a, b, c is wrong.
October 21st, 2008 at 10:12 pm
The workers are the money. It all starts with them.
October 21st, 2008 at 10:44 pm
One of my co-workers was laid off from Circuit City as a salesperson. He actually knew his products and possessed sale skills necessary to sell effectively. Nowadays, many inexperienced employees with little knowledge in their products seem to work at these stores.
October 22nd, 2008 at 7:34 am
If I have a Circuit City credit card and there is a balance on it when they go out of business how do they collect?
October 22nd, 2008 at 10:18 am
Having worked for Circuit City in the past, up to the point of getting into their management in training program I can safely say that every store I had the displeasure of working in not only took part in this kind of whiplash reaction to a common problem, but it was encouraged. In my time with them I went through 3 store managers, 3 operations managers, 3 pc managers, 4 tv managers, and saw a number of good, well mannered, productive employees fired to make way for people who would do the job with half the enthusiasm for a fraction of the cost. Keep in mind this is over the course of maybe 1 year. Having worked for both of the big electronics retailers I can say without a doubt that as fake and hoakey as Best Buy is, at least they pretend to care about their employees. Circuit City is perpetually behind the times whether you’re talking about blindly sticking to commissioned sales or outdated register hardware and software.
October 22nd, 2008 at 10:56 am
Those of us on here that agree with the article’s argument have all probably had the experience of leaving a store because they could not get an appropriate level of information needed to make a particular purchase from one of the sales people. Although the writer has not expressly stated this, it’s surely implied by the fact that most of their readers participate in a free market society, and if they have never voted with their dollars, I encourage them to do so. Would you expect the author to stop their article in order to explain the discovery, significance, and existence of the concept of the wheel? We are talking about self-evident facts in a free market society. If you hire sales resources who are not experienced with your product you WILL miss sales opportunities. Not every shopper is willing to do the research themselves. The degree of severity on each side of that equation is certainly up for debate. However, the dynamic implied in the authors argument is sound.
November 6th, 2008 at 6:21 pm
imo the problem was likely there way before this happened. this was just a symptom of the problem not anywhere near the cause.