Circuit City, which cut 10 percent of its U.S. workforce this year and hired people willing to work for less, is losing market share to larger rival Best Buy Co. Sales in stores open at least 12 months fell 5.6 percent in the third quarter.Apparently they didn't realize that when people are going in to buy big ticket items (tvs, etc.) that they like to talk to someone knowledgeable rather than a high school kid.
Friday, December 21, 2007
Karama is a behatch
Circuit City Loss Widens; Shares Plunge on Forecast
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2 comments:
The guy that runs this company is pretty smart -- maybe it is the economy?
2 counter arguments - 1) why is best buy also not dropping? and 2) "Circuit City could only blame itself though for its sizable earnings miss. "We believe that these issues are primarily self-induced and are within our control to improve," said Chief Executive Officer Philip J. Schoonover.
When a consumer a consumer purchases big-ticket items, Circuit City employees try to also sell them accessories, installation services, and extended warranties. Sales of these high-margin add-ons dropped during the third quarter from a year ago.
Layoffs of experienced Circuit City employees likely dragged down company salesmanship. Earlier this year, Circuit City announced it would fire around 3,400 employees and replace them with lower-wage workers."
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