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Credit-rating Service Advises Against Selling With Circuit City
It was yet another blow to the retailer that recently reported a $239.2 million net loss during its fiscal second quarter and experienced executive reshuffling.
However, Circuit City told the Richmond Times-Dispatch, its hometown newspaper, that it shouldn't be affected by a downgrade from the retail credit-rating service and that it still has a good relationship with vendors.
Things have looked steadily grimmer for Circuit City since Blockbuster withdrew its initial takeover offer last summer.
Is this the end for Circuit City?
The big-box retailer does appear shaky. Its gross profit fell to $509 million for Q2 from $546 million last year. It also withdrew its previously given fiscal 2009 forecast, citing new initiatives and a comprehensive review, which is currently undergoing.
The company’s problems are "all outlined in [their second quarter earnings] release," Bob Carbonell, executive vice president and chief credit officer for Bernard Sands, told the Times-Dispatch. "We're a credit reporting agency. We just report facts."
Circuit City spokesman Bill Cimino indicated to the Times-Dispatch that its vendors understand the position Circuit City is in. Circuit City is the No. 2 CE retailer in the United States behind Best Buy.
"We are in regular contact with our vendors and this action has not caused any issues with getting product for the holidays."
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2 Comments (displayed in order by date/time)
Circuit City stores are empty of customers, full of employees walking around.
They’re so hip on computers and “Firedog”. Ever try to buy a motherboard there? They have lines and lines of prebuilt computers and not one motherboard for sale. No memory or CPUs, either. They do have video and sound cards, paradoxically. I wonder if those “Firedogs” ever built a computer? If they haven’t how can we expect them to sell one? Maybe those “Firedogs” can bark at the “Firemen” to put out the flames! We have a Fry’s that just killing them and Best Buy. Does Fry’s have the lowest prices? No. What they do have are motherboards, memory, cases and CPUs that the rich doctor’s cash-filled kid craves. While they’re buying that motherboard, they’re buying video cards and monitors as well. They have no reason to go to CC or BB. In this huge city there is Fry’s, Altex (overpriced AND outdated motherboards), and Goodwill (ancient used AMD motherboards). Fry’s is really the only game in town and the store is crowded all the time.
The competitors just don’t get it.
Fry’s really built its reputation here by being the first store to have a real selection of LCD and plasma TVs and big, stuffed leather chairs to watch them in the store with. It was an event to go to Fry’s and take a look at those big Panasonic plasmas. Fry’s beat BB and CC to the punch and the others have been trying to make up by opening more stores. Idiots. Only one Fry’s and they’re killing them all. So-called Black-Friday Fry’s usually has about 50 registers going and there is still a line.
I think CC and BB have fallen into a trap: They’re busy trying to sell me something that I don’t want when all I want is to buy something they don’t have and don’t have any plans to.
They haven’t cause problems with getting holiday product because they probably aren’t stocking because there going bye bye :p