Circuit City In Trouble

[stratman]

Circuit City laying off 3400 higher salaried employees, to be replaced by lower waged personel. They're citing the "plasma price war" as one of the deciding factors (big box stores were the other), smells like restructuring to me. First Tweeters now Circuit City, who's next?..............Some blame can also be attributed to internet sales.

Audioholics News Article: http://admin.audioholics.com/news/industry-news/circuit-city-lays-off-3500-jobs.html

 

[Sheep]

Or maybe people are finally coming to their sense and DON'T want to be dicked around with anymore....

SheepStar

 

[j_garcia]

I blame the iPod...


Not that I entirely care, because I rarely shop at CC anyway, but still not good news. "Big box" stores? I'm sure Costco is cutting into their profits

The market is just that way in the last few years... It wasn't really publicized but Cambridge Soundworks recently closed ALL of their retail stores and do business online only now.

 

[markw]

Or maybe people are finally coming to their sense and DON'T want to be dicked around with anymore....

SheepStar

If all the B & M stores go by the wayside, where will anyone go to audition new products?

It's one thing to ship a pair of speakers back and forth across the country for a trial, but when it comes to these TV sets, it can get pretty pricey, not to mention risky. Can anyone say "restocking fees"?


BTW, isn't Circuit City married to CompUSA, or is that someone else?

 

[j_garcia]

GoodGuys were associated with CompUSA, and that was just to acquire some of the brands they carried and to keep GG afloat for a little longer since they are gone now (closed by CompUSA). And now CompUSA is on their way out as well...

 

[stratman]

Internet sales are fine as long as there is a balance of B&M versus virtual stores. As Mark pointed out, if you theoretically negate all B&Ms, the friendly virtuals will no longer be too friendly, re-stocking fees, higher shipping rates, higher prices. After all competition is necessary for the consumer to get a break. One such example in my town was Home Depot, years ago when they were getting established they drove all the mom and pop stores out of business with below market prices in some items (it gets people in, then they get you going out), the mom and pops couldn't make money so they closed. Lo and behold we have no decent mom and pops left down here, the rest were "forced" to become ACE protectorates. Now Home Depot isn't that cheap anymore. All these chains will have to change their business model, learn to adapt or they will disappear much to our harm as audioholics.

 

[mazersteven]

If all the B & M stores go by the wayside, where will anyone go to audition new products?


?

Small Mom & Pop boutique stores thats where. If people would realize that you can get a deal from these places. Just like the big box stores, and have a better auditioning room.

 

[Tom Andry]

The problem IMO with the big box stores is that they don't really offer a considerably different product than Sam's or Costco. It is mostly the same products but at higher prices. More stores need to do what BB did and integrate Magnolia (or other mid-fi brands). That's the only business model that makes sense to me. The way to compete with Sam's/Costco is to not compete - offer something different (preferably better).

 

[Sheep]

If all the B & M stores go by the wayside, where will anyone go to audition new products?

It's one thing to ship a pair of speakers back and forth across the country for a trial, but when it comes to these TV sets, it can get pretty pricey, not to mention risky. Can anyone say "restocking fees"?


BTW, isn't Circuit City married to CompUSA, or is that someone else?

Since when is one of those stores considered a "good" place to audition speakers? Maybe they'll have to fix up their mandatory warranty police, and ditch the pushy sales tactics things will turn around. I worked at best buy, if you aren't selling, you aren't working.

SheepStar

 

[markw]

Although I mentioned speakers, note I used them in an exclusionary fashion.

Since when is one of those stores considered a "good" place to audition speakers? Maybe they'll have to fix up their mandatory warranty police, and ditch the pushy sales tactics things will turn around. I worked at best buy, if you aren't selling, you aren't working.

SheepStar

The crux of my statement was these biga$$, delicate, heavy TV's that are now all the rage. Speakers are pretty much a commodity nowadays. So are most electronics.

 

[markw]

the pricing structure of big companies don't work in mom & pop's favor.

Small Mom & Pop boutique stores thats where. If people would realize that you can get a deal from these places. Just like the big box stores, and have a better auditioning room.

Big stores with a high inventory turnover rate can buy much, much more product than a widdle biddy mom and pop store can. As such, they qualify for biiiiiig discounts.

And, since mom and pop can't match the price of a faceless Internet or big box store (at least while maintaining a reasonable profit) and eventually starve to death.

Remember, it's low prices that attract people to the Internet, not the showrooms and face-to-face service. Those last two cost $$.

A few "boutique" stores in this area work only by appointment and don't offer the type of stuff we here deal with. They don't even want to be bothered with walk-in hardware sales because they don't really profit from them. They push custom installations as their main profit maker and the hardware is secondary.

 

[MDS]

Yes, a lot of electronics products are effectively 'commodity' products now but it really does come down to price for a lot of people. IF there were any boutique audio outlets around here and they offered the same products at a marginally higher cost but with superior service and knowledgeable salespeople that gave you the straight scoop and were interesting to talk with, I personally would pay the difference to support them.

I guess at this point in my life I am not overly price conscious but by the same token I won't pay a huge premium for the same product. The big box stores are not that price competitive and definitely do not offer the same level of service and knowledgeable salespeople that some boutique type stores offer.

 

[j_garcia]

I am still price conscious, however I will also go with a local shop if the price difference is not that big for certain items, especially higher dollar items IF I like the service of the particular store.

IMO stores like CC that tried to do too much. Sell everything and be experts in NOTHING and they are reaping what they've sewn. With the knowledge on the web, the typical consumer knows as much or more than the salesperson at a typical place like this.

 

[stratman]

The problem with "boutique" stores is that they deal with "high-end" gear (Mark Levinson, Krell, Mc Intosh, etc, etc)so a person looking for Yamaha, Denon or other "mid level" brands will not be serviced, these stores (not all, but the majority) tend to cater to the wealthier clientele of A/V, they don't make their money in volume discounts they make it on expensive brands, customized service (costs money), and customer back patting. There's nothing wrong with that, certain types of customers are willing (and have the means) to pay for "sterling" service. You know, a glass of wine while they set up your listening "experience", they know you on first name basis, you get the drift. A store strictly dealing in mid level electronics only, has more competition to deal with, apart from the internet. People that walk into BB not only go for audio/video electronics, but home appliances, dvds, cds, phones, computers etc. So when they're not selling Yamaha they're selling Maytag or Dyson, bottom line: money is being generated, a mid fi store will find it hard to survive, example Tweeters (Sound Advice.)

 

[mazersteven]

The problem with "boutique" stores is that they deal with "high-end" gear (Mark Levinson, Krell, Mc Intosh, etc, etc)so a person looking for Yamaha, Denon or other "mid level" brands will not be serviced, these stores (not all, but the majority) tend to cater to the wealthier clientele of A/V

I disagree. I have never purchase one item from a big box store. All my gear has come from a boutique store. Yes they sell the high end gear, but also the mid, to low end gear. Some specialize in only high end. Some in mid, to low end gear. You can find almost anything you want in a boutique store except HTIB's

I purchased my Denon 6 months before Costco offered it for $100 less. And at a boutique store.

 

[majorloser]

The problem with "boutique" stores is that they deal with "high-end" gear (Mark Levinson, Krell, Mc Intosh, etc, etc)so a person looking for Yamaha, Denon or other "mid level" brands will not be serviced, these stores (not all, but the majority) tend to cater to the wealthier clientele of A/V, they don't make their money in volume discounts they make it on expensive brands, customized service (costs money), and customer back patting. There's nothing wrong with that, certain types of customers are willing (and have the means) to pay for "sterling" service. You know, a glass of wine while they set up your listening "experience", they know you on first name basis, you get the drift. A store strictly dealing in mid level electronics only, has more competition to deal with, apart from the internet. People that walk into BB not only go for audio/video electronics, but home appliances, dvds, cds, phones, computers etc. So when they're not selling Yamaha they're selling Maytag or Dyson, bottom line: money is being generated, a mid fi store will find it hard to survive, example Tweeters (Sound Advice.)

In South Florida, Brands Mart rules the roost. They have hurt (UN)Sound Advice for years. Even BB has a tough time competing with them. Granted, shopping at Brands Mart is really considered combat.

(I'm still glad I left )

 

[Audioholics]

I wrote up a news article on this with some facts and opinion mixed in...

http://www.audioholics.com/news/industry-news/circuit-city-lays-off-3500-jobs.html

 

[stratman]

I disagree. I have never purchase one item from a big box store. All my gear has come from a boutique store. Yes they sell the high end gear, but also the mid, to low end gear. Some specialize in only high end. Some in mid, to low end gear. You can find almost anything you want in a boutique store except HTIB's

I purchased my Denon 6 months before Costco offered it for $100 less. And at a boutique store.

I'm curious, what do you define as a boutique store?

 

[stratman]

Clint I just read your article, spot on. Circuit City has some troubling days ahead. I remember there was something odd about CC, a couple of years ago they stopped selling home appliances, which is inventory that moves when your a/v is struggling, I could never figure out why. In retrospect, I believe it was a dumb business move. Like the Major said, down here Brands Mart rules the coop, they have the best prices in town( Panny 42 plasma, 975.00, I haven't seen that anywhere on line.) They also sell everything in electronics known to man, if you try to shop there on a Sunday, you'll have to bring a club.

 

[mazersteven]

I'm curious, what do you define as a boutique store?

A small audio/video store owned by a person or persons. Not a franchise chain store.

Like this one that I purchase my gear from.

www.tropicalvideosystems.com