Circuit City is closing stores 62 stores in Canada and seven underachieving stores in U.S. cities as well as reshuffling its corporate ranks. A support center in Barrie, Ontario will also be closed along with Rapid Satellite, an online reseller of DirecTV service that Circuit City bought in 2005 and has subsequently tried to sell. The closings are equivalent to approximately 400 jobs in both countries. Executive VP and chief merchandising officer Doug Moore has left the company, while David Matthews, former president of Circuit City's multichannel direct sales operations, will now be responsible of the company's merchandising, marketing, services and supply chain teams. Former president of retail sales George Clark will take over as executive VP of multichannel sales, in charge of all domestic and international retail stores and Circuit City Direct.
Circuit City had actually managed double-digit sales growth in flat panel televisions during the month of December but overly aggressive pricing and possibly some ill-advised choices in inventory management hurt the company in the long run. Circuit City CEO Phil Schoonover said the moves were designed to counter an unexpected downturn in prices and margins for hot-selling LCD and plasma TVs. He also warned that this round of store closures will be followed by further unspecified cost-cutting actions in the next six months. The company currently operates 655 "The Source by Circuit City" retail locations in 158 U.S. markets, along with more than 800 retail stores and dealer outlets in Canada.
News source: DailyTech