A week after it announced 155 store closures in the U.S., Circuit City on Monday filed for Chapter 11 bankruptcy.
The electronics retailer "plans to continue operating the business without interruption," according to a statement.
On Nov. 3, Circuit City said it would shut down 155 stores in 28 states, and reduce its workforce by 17 percent.
The company said Monday that it also laid off an additional 700 people at its corporate headquarters for a total workforce reduction of 20 percent.
The move comes amidst concern from Circuit City vendors about its financial situation.
"Despite aggressive efforts to secure vendor support, vendor concerns about the company's liquidity and ability to pay for its purchases in this difficult economic climate have escalated considerably since" the company announced plans to shut down some of its stores, according to Circuit City.
No additional store closings were announced, but the company said it reserves the right to "review additional cost-cutting initiatives."
"We understand how difficult the recent announcements have been on everyone at the company, and we recognize the changes personally affect many people," James A. Marcum, vice chairman and acting president and CEO of Circuit City Stores, Inc., said in a statement. "In the meantime, our stores remain fully operational, and our associates are focused on consistent and successful execution this holiday season and beyond."
Circuit City lists its total assets at $3.4 billion and its total debts at $2.3 billion.
In April, Blockbuster announced that it offered to acquire Circuit City Stores for $1.3 billion, but Circuit City declined the offer.
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November 10, 2008 1:29 PM
Circuit city's filing for chapter 1 tells of many things but 2 things in particular - 1) Businesses across many sectors (not just banking) large are getting wacked and 2) after we reach the bottom of this recession, there will be many opportunities for people and companies to stake their claim on the new landscape.
Listen to the tone of airwaves, minus the recent election of President-elect Obama, everything has been so negative! Honestly, think about how negatively our society portrays almost every situation. Acquiring a negative perspective is easy, but stand up and make a statement about yourself - tell yourself you will not victim to this negative jargon! If you find yourself in a hole, ask yourself this question: what will more likely improve your chances of being successful - continuing with a negative outlook or transforming your thought patterns into a positive outlook?
I work with many high level c-level executives that have experienced tremendous success in their life. The one binding characteristic between all of them is that they do not let external, uncontrollable factors influence their inner dialogue and visions for future success. In fact, many of these people use a vision board - a collage of images that symbolize personal goals success - to help them keep focused on their positivity and desired outcomes. I might suggest using one yourself if you are currently in a rut. You should look at the helpful information on how to make one over at www.TheVisionBoardKit.com.
November 10, 2008 1:40 PM
It could be that they sold garbage for premium prices, but that's just my opinion.
November 10, 2008 2:27 PM
Remember when Circuit City was a favorite in "Good to Great" by Jim Collins. Remember when we thought being big gave you clout with customers and vendors to produce long-term returns (Michael Porter's 5 Forces Model). It's time we recognize that the old approach to management doesn't work in a rapidly shifting competitive world. There are winners in today's market, but they follow a different approach. Read more at http://www.ThePhoenixPrinciple.com
November 10, 2008 8:50 PM
There are layoffs but I still see thousands of high paying jobs.
www.linkedin.com (professional networking)
www.indeed.com (aggregated listings)
www.realmatch.com (matches jobs based on your skills)
Good look to the circuit city folks!