Why Circuit City Failed??

I remember when our family was looking for a new TV or a computer we would go to Circuit City. We would get great deals and have extremely good customer service. Now, you would get an excellent deal because they are now having a seventy percent offsale because they are closing down all of their stores but you might not find your TV or computer. As of January 16th, 2008, Circuit City came to the public saying they have decided to shut down all of their stores and start the liquidation process.

By what I have read in the articles, it seems that the reason why they went bankrupt was because of the creditors and lenders and CC just couldn't make a good agreement. They decided in November 2008 they were going to close twenty percent of their stores, which were 155 stores in USA. It also seems that Circuit City also went bankrupt due to poor management. It seems as they didn't know what to do financially.

I also believe that Circuit City failed in the retail industry because over half of their profits were made by internet sales. They didn't do a lot of business in stores compared to internet sales. And with our economy in a recession I believe that it made it worse for Circuit City. Not everyone can go and spend all this money on TV's, computers, etc, with the way our economy is. With the economy the way it is, people wants the best quality for the cheapest price and with competitors like Best Buy and Wal-Mart, Circuit City just couldn't keep up.

Articles:
http://www.bizjournals.com/orlando/stories/2009/01/12/daily51.html?ana=from_rss
http://retail.freedomblogging.com/2009/01/16/circuit-city-going-out-of-business/6058/
http://money.cnn.com/2009/01/16/news/companies/circuit_city/

Picture:
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