Why Circuit City Failed

For this weeks' blog I decided to do a little research into why Circuit City went bankrupt.

I read some things online from previous employees of Circuit City about why they think the retailer failed. I found an article with the opinions of people on why the store failed on consumerist.com. On of the past employees said that he thought one major downfall was the fact that Circuit City stopped carrying kitchen appliances. This is a major chunk of sales in electronics stores and not carrying them anymore definitely hurt their sales and improved the sales of stores who did carry appliances. Another reason he thinks that the store failed was that people are more interested in self-service shopping these days and at Circuit City the employees are commission based. They try to push items on people because they will make more money but that really doesn't work well with small items like batteries and accessories. Another ex-employee feels that the stores should have gone more warehouse style like Best Buy instead of staying with their showroom like layout. People are interested in getting in, finding what they need and getting out and showroom styles are not as convenient as warehouse style layouts.

I also read an article about why Circuit City failed on www.time.com. The article compared it to its' rival, Best Buy, and what they did wrong. The main thing that was faulted was poor management. They were the leading electronics retailer in the 80's and 90's but didn't adapt to changing times in the 2000's. They became 'complacent' with locations, causing people to go to closer places like Walmart instead of driving way out to Circuit City. Another thing the retailer did wrong was not to move at the same pace as the rest of society. They stopped carrying appliances, barely got into the gaming craze, and did not do much to improve their website.

The main reason I stopped going to Circuit City in favor of Best Buy is because there was one closer to where I lived. They seemed to have more of what I wanted at that time like iPods and cell phones and from what I understand, they have better prices. I also stopped going to Circuit City because I heard that they are not equal opportunity employers and treat certain employees better than others based on personal issues such as sexual orientation. Overall I just think that Circuit City couldn't keep up with the competing stores and didn't do enough to improve on their stores.