Liquidation madness: Did Circuit City sell off its ability to use math?

It's now been over a month since Circuit City began its liquidation. We've covered the liquidation to death; you probably won't get any real deal at these stores unless you're both canny and lucky. They jack up prices to MSRP, then start shaving off the percents, all in the name of the liquidation. That isn't news.

However, when they're failing to even deliver the on the 30%-off-MSRP price they promise, because they assume people can't use math? That's a bit of news.

I stopped by a nearby Circuit City last week to see how the sale was going. The 15%-to-30% signs have long since been upgraded to 30%-to-60%-off signs, but good luck finding anything useful for more than 40% off in the store. The front of the store had several stacks of brown boxes full of Onky, Pioneer, and other home theater equipment, all claiming to be 30% off. The actual prices they quoted told a different story.

This Onkyo TX-8555 stereo receiver was priced at $229.99. That's about the MSRP for it, but you can get it for $210 or lower if you shop around. After the "30% discount," the final price was $209.99. For those of you who aren't math-savvy, that's completely wrong. 30% off of the $230 receiver should be a little over $160. That $210 price tag is less than 10% off.

Circuit City Return Policy

Sad and depressing, but it needs to be discussed. Circuit City customers need to understand how the company is handling their returns during this transitional period — as they transition from company to nothingness.

We reported last week that during the liquidation sale, all sales will be final. But, what about folks who purchased an item right before the liquidation sale?

If purchased between January 1st and January 16th, your items have a 14-day return policy.  But, if you did some last minute holiday shopping, items purchased before January 1st have the original 30-day return policy.

If you have an item you're even just thinking about returning, head over immediately to make sure you're not disappointed.  —Leslie Shapiro

Circuit City Closing For Good

It's truly a sad day for consumer electronics. Today, Circuit City has asked the courts to approve the closing and liquidation of its remaining 567 stores in the US.  Unfortunately, the approximate 34,000 employees will also be losing their jobs, although they'll be paid for 60 days.

"We are extremely disappointed by this outcome," James Marcum, acting CEO for Circuit City, said in a statement. "Regrettably for the more than 30,000 employees of Circuit City and our loyal customers, we were unable to reach an agreement with our creditors and lenders to structure a going-concern transaction in the limited timeframe available, and so this is the only possible path for our company."

If there is a silver  lining, it's that the liquidation sale will start tomorrow and run until March 31.  The website will shut down on January 18.  All sales are final -- there will be no returns.

Please note: if you have Circuit City gift cards, they will be redeemable through the liquidation sale, but will be worthless after the stores closed.  Use them immediately. —Leslie Shapiro

The New York Times

Samsung to Circuit City: Payback's a Bitc. . .

Circuit City has a long list of problems -bankruptcy and store closings are probably tops. Well, Samsung just added to their worries.

According to a U.S. bankruptcy court filing, Samsung is demanding that Circuit City return nearly $74 million in consumer electronics. Merry Christmas.

Although Circuit City filed for Chapter 11 protection back in November, Samsung claims that the stores were insolvent at the time they received the goods.

What makes it worse is . . .

Circuit City Receives a Lifeline

Circuit City is not going down without a fight. Just a day after filing Chapter 11 bankruptcy, Bank of America comes to the rescue. To the tune of $1.1 billion. Yowza.

Not sure if that's even going to be enough — the company is $2.3 billion in debt, owing billions to companies like LG, Samsung, and Sony. Not exactly companies you want to blow off.

This credit line is hoped to be enough to pay salaries and secure new merchandise to carry the store until it's expected to get out of debt next year.

See more details . . .

Circuit City Files Chapter 11: Women and Children First

Just days after announcing that they're shutting down 155 stores and laying off thousands of employees, Circuit City just took another step towards the deep end of the pool. Today, Circuit City filed for chapter 11 bankruptcy.

Chapter 11 holds off creditors, temporarily. Circuit City has negotiated a commitment for a $1.1 billion "debtor-in-possession revolving credit facility to supplement its working capital," according to a report on CNET.

In addition to those layoffs, another 700 positions are looking at pink slips.

Ever the optimist, see what CEO James A. Marcum had to say.

Blu-ray Bargains: How Low Will They Go?

Feeling lucky? How lucky? Do you wait until Black Friday to pick up a Blu-ray player for a great price, or trust that the price at the floundering Circuit City will be your best bet? For a limited time (guessing at that — they're listed in the "Outlet" section of the store) the Sony BDP-S300 is available for a mere $176.96. Or, do you wait?

Circuit City isn't the only retailer with pre-Black Friday bargains . . .

Circuit City Shrinks Self

Things are tough, especially in consumer electronics. Circuit City is really taking it on the chin. As we previously reported, the rumor was that CC was going to close stores to try to stay afloat. Now, that rumor has become reality.

It was officially announced that Circuit City will close 155 domestic stores and lay off 17% of its workforce. The official statement: "Due in part to its deteriorating liquidity position and the continued weak macroeconomic environment, the company has decided to take certain restructuring actions immediately, including closing 155 domestic segment stores, reducing future store openings, and aggressively renegotiating certain leases."

The company was caught in the same squeeze the rest of us are feeling: "The sharply worsened overall economic environment led some of Circuit City's vendors to take restrictive actions with respect to payment terms and the credit they make available to the company." The company also said it has been unable to collect an income tax refund of approximately $80 million that the company believes the feds owe them. Been there, done that.

Circuit City, Cutting Off Nose?

You know the saying, cutting off your nose to spite your face? You have to wonder if Circuit City might have done the same. We reported earlier this week that the mega-retailer is going to shut down 150 stores and is laying off thousands of employees.

We blamed the economy. But we have to wonder if something else was behind their downward spiral.

Circuit City; Trimming the Fat

Circuit City is getting lean and mean. Cutting the fat, drastically, so to speak. In perhaps a last ditch effort to stay afloat, the second biggest consumer electronics brick-and-mortar retailer is closing at least 150 stores.  That's huge — about 20% of the 712 stores located in the U.S.

Thousands of employees will lose their jobs because of the closings and, according a story in the Wall Street Journal, they'll liquidate $350 million in consumer electronics inventory.

What's behind the closings?