Circuit City To Close All Stores
Only a week after the Associated Press reported that there may be some hope for embattled electronics retailer Circuit City, the store has announced that they are closing up shop forever. This means that 34,000 more jobs will be lost, and the nation will have one less electronics superstore to comparison shop at.
The economic news has not been good on many fronts, and consumers are feeling the pinch in all directions. For the satellite radio consumer, it means one less outlet where customers can buy satellite radio gear. For Sirius XM there is a possible bright side. With Circuit City gone, the company will not be spending money on shelf space, ads in Circuit City flyers, nor will they need to send sales staff to the over 500 Circuit City stores any longer.
The company should think twice before thinning out the sales staff though. In many ways, the average big box retailer employee does not understand satellite radio well enough to even begin to speak about it with any real authority. From mispronouncing the brand, not comprehending the merger, and not even knowing that the music is the commercial free aspect of the service, many problems exist. The company should consider bolstering the sales force in remaining retailers, from those that once serviced Circuit City, to better educate those that sell to consumers.
Knowledgeable retailers such as TSSRadio may well benefit the most. Small independent companies that have a passion for the service offer consumers far more than the Circuit City’s or Best Buy’s of the world could ever hope to accomplish.
Yes, the closure of Circuit City means less exposure for satellite radio, but did the benefits in the existence of Circuit City outweigh the costs associated with servicing those stores? Two years ago, when retail meant more to SDARS, the impact would have been measurable as a negative. Today, with weak retail anyway, I am not so sure that would be the case. Certainly the print ad budget and shelf space payments dedicated to Circuit City will go away. The question is how everything will impact the bottom line.
Position – Long Sirius XM, No Position Circuit City or Best Buy, TSS Radio is a site sponsor of SiriusBuzz
Thanks, Tyler. Does this bankruptcy give any clues about Sirius’ ability to refinance now? Are the credit markets getting worse again. I was starting to see some articles suggesting that there were signs of thawing. I wonder if BOA and Citi needing more money now has reversed this trend.
How much was Circuit city under water?
Tyler, Thanks for bringing up a big problem that exists for Sirius Xm. Lack of knowledge by most sales people at the retail level. I think we all discount the aftermarket potential of Sirius Xm. Be it installs or portable products, I just think this area is being overlooked. If I was in charge of overall aftermaket sales, I would either give or offer huge discount of Sirius Xm products along w/ a period of free subs to the retail sales person. The only string attached would be some form of a class w/ a written test on the basics of SatRad. The higher the score the better the discount (or even free). I can’t tell you the number of times I go into Best Buys or Circuit Citys and ask the sales person what SatRad is all about. I would say 75% of the time they come up way short on their knowledge. But the good news is when I come across a sales person in the know, it’s usually because of they are subs. Most of all those 25% are enthusiatic about the product and will tell you why and how great it is and why you should buy it. With the auto industry in a long downturn,you have to go after this area. Both my Sirius radios are aftermarket intalls. It’s ignorance or arrogance not to realize the potential of this market!
Maybe Sirius gets a spike in subs from clearing out of their inventory of satellite radios at very low prices ?
Either that or they are returned to Sirius.
Dunno if the store closings are going to put a lot of new receivers in people’s hands (or, more importantly, new subscribers’ hands).
I was in Circuit City this past weekend (looking for any semblance of a deal — I guess I’ll need to wait until the end of February for that!), and while a lot of merch seemed to be moving, satellite radios didn’t seem to be among that merch. If you looked at how picked over the TVs, and BluRay players were, you’d know this store was closing.
If you looked at satellite receivers, you’d think “Wow. This store keeps everything so well stocked.”
I would think these receivers would get returned or sold off at big discounts. I hope Sirius is on top of this & can get some value from the inventory.