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Circuit City files for Chapter 11 Bankruptcy

rpaloalto said:
LOL that is so true. I hate going in their. Their is always some teenager coming up to you. Asiking if you need help. You politley tell them no thank you. Two minutes later your asked again. And then again and again.
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Heh. This happens to me at a lot of stores. Then one day you'll walk into the store with the express purpose of buying product X, and you will stand there for 10 minutes waiting for someone to come help you so they can get it for you. You could do jumping jacks and wave wads of cash around in your hands and they'd still ignore you, because they're too busy pestering people who DON'T want to be helped.

Still, I will always remember Circuit City as the company that tried to kill DVD. Yeah, I'm still bitter.
 
Time to buy BBY. Once Circuit City flops, Best Buy will be the only large CE retailer in many, many markets.
 
Yikes...

This is going to be one nasty holiday season.

The company's biggest creditors are its vendors: Hewlett-Packard has a $118.8 million claim followed by Samsung ($115.9 million), Sony ($60 million), Zenith ($41.2 million), Toshiba ($17.9 million) and others. Smaller creditors include GPS navigation system maker Garmin, Nikon, Lenovo, Eastman Kodak and Mitsubishi.

Well, its been fun CC. Looks like you're going to tank badly. Yes, Chapter 11 may protect you from your creditors, but that damn sure as well doesnt force them to send you new product.
 
ReanimationLP said:
Yikes...

This is going to be one nasty holiday season.

The company's biggest creditors are its vendors: Hewlett-Packard has a $118.8 million claim followed by Samsung ($115.9 million), Sony ($60 million), Zenith ($41.2 million), Toshiba ($17.9 million) and others. Smaller creditors include GPS navigation system maker Garmin, Nikon, Lenovo, Eastman Kodak and Mitsubishi.

Well, its been fun CC. Looks like you're going to tank badly. Yes, Chapter 11 may protect you from your creditors, but that damn sure as well doesnt force them to send you new product.
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K-Mart was able to do a pull around using the Martha Stewart line as leverage with the rest of their creditors.

CC has no saving grace in any product line, the liquidator they hired when the closures started doesn't look like management expected the company to survive.

I was at least expecting days to a week after Thanksgiving to be the final announcement. But the slide looks like the creditors want out and will push them into the hole.

The creditors want their money, and the landlords are going to fight hard to keep their money even with a closed CC store in their complex -- since they cannot fill them, and legal fights with the tenant with the signed contract is easier than getting a new tenant right now.

aka, it sure looks over, now the death watch to the last store closes.

Basically I'd expect them to try for December 24th or Jan 1st -- but expect an all sales final notice for the liquidation to show quite soon so they don't have to handle Christmas returns.
 
Here in Sacramento, Circuit City cannot compete against Best Buy, Costco or Wal-Mart, all of which are in a far better financial position and have enough "buying pull" to purchase consumer electronics on a large scale at a discount.

I could see Circuit City starting their "out of business" sales within a week.
 
joeshell383 said:
Time to buy BBY. Once Circuit City flops, Best Buy will be the only large CE retailer in many, many markets.
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Or not.


MINNEAPOLIS (AP) -- Electronics retailer Best Buy Co. says it is sharply cutting its fiscal 2009 earnings outlook below analyst estimates amid what the company called the toughest retail environment it has ever seen.

Richfield, Minn.-based Best Buy expects earnings per share between $2.30 and $2.90 for the fiscal year ending in February, down from a prior estimate between $3.25 and $3.40 per share.

The retailer forecast revenue between $43.7 billion and $45.4 billion, as well as 1 percent decline in same-store sales, or sales at stores open at least 14 months.

Analysts expect earnings of $3.02 per share and sales of $46.23 billion for fiscal 2009, according to a Thomson Reuters survey.

Best Buy's same-store sales dropped 7.6 percent in October. Same-store sales are a closely watched performance indicator because they measures sales at existing locations rather than newly opened ones.
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A few months ago, I saw a report on the nightly news that something like 20-30% of all businesses will not be able to survive the next two or three years. I almost avoid watching the morning news because it is almost always BAD news about the economy, unemployment, job losses and company bankruptcies.

Here in the Silicon Valley, Applied Material is expected to cut jobs, Intel reduces sales projections, Mervyn's (HQ here in the Bay) is gone, and even Mother's Cookies is done.

I've got my eye on BBY. I believe it, along with the rest of the market, will slide further due to the upcoming frigid holiday un-shopping season. I've already got my limit order set on them...
 
It's never a good idea to be in debt to your vendors. I worked at Mars Music up until they closed up shop. During the last 9 months or so it was really hard to make any sales. For the most part in the recording dept. (where I worked) what we had was on the floor as a demo. We would sell the demos below cost (also costing us commission), Then the vendor would send us a new unit to demo and then sell below cost. There was very few things valued over a few hundred because the vendors were not getting paid.

The millions that CC seems to own vendors is totally the fault of the vendors. Why was no one there to stop and say "Maybe we should see some money before sending more product"
 
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