Circuit City Woes
02-05-03 | 12:41 AM
#1
Thread Starter
DVD Talk Gold Edition
Joined: Oct 2000
Posts: 2,456
Likes: 0
Received 0 Likes
on
0 Posts
From: Pittsburgh, PA, USA
02-05-03 | 08:19 AM
#2
DVD Talk Legend
Circuit City Sets New Sales Approach
BY GREGORY J. GILLIGAN
Times-Dispatch Staff Writer
Circuit City Stores Inc. plans to announce a restructuring plan this morning that likely will stop paying commissions to store sales personnel.
While the Richmond-based chain would not discuss details, several sources indicate that Circuit City plans to shift from its usual pay structure to one in which salespeople are paid an hourly wage.
Doing so would mean a huge cultural, philosophical and operational change for Circuit City, which has long heralded the fact that it pays salespeople a commission.
The company has believed the pay system provided customers with better service and product knowledge. And it allowed Circuit City to differentiate itself from chief rival Best Buy, which stopped paying commissions in 1989.
Customers feel pushed
Yet many shoppers often are turned off by pressure from salespeople working on commission. And Best Buy continues to take market share away from Circuit City by talking up how its format does not use commissioned sales personnel.
"If this is the case, they are throwing in the towel on the way they do business. They are giving up on their business model," said Aram Rubinson, an analyst with Banc of America Securities in New York.
The changes also mean Circuit City is yet another step closer to looking like and operating like Best Buy, other analysts said.
"They're losing their niche if this is the case," Rubinson said. "Best Buy is at the plateau of the learning curve on this and Circuit City would be at the beginning of the learning curve."
BY GREGORY J. GILLIGAN
Times-Dispatch Staff Writer
Circuit City Stores Inc. plans to announce a restructuring plan this morning that likely will stop paying commissions to store sales personnel.
While the Richmond-based chain would not discuss details, several sources indicate that Circuit City plans to shift from its usual pay structure to one in which salespeople are paid an hourly wage.
Doing so would mean a huge cultural, philosophical and operational change for Circuit City, which has long heralded the fact that it pays salespeople a commission.
The company has believed the pay system provided customers with better service and product knowledge. And it allowed Circuit City to differentiate itself from chief rival Best Buy, which stopped paying commissions in 1989.
Customers feel pushed
Yet many shoppers often are turned off by pressure from salespeople working on commission. And Best Buy continues to take market share away from Circuit City by talking up how its format does not use commissioned sales personnel.
"If this is the case, they are throwing in the towel on the way they do business. They are giving up on their business model," said Aram Rubinson, an analyst with Banc of America Securities in New York.
The changes also mean Circuit City is yet another step closer to looking like and operating like Best Buy, other analysts said.
"They're losing their niche if this is the case," Rubinson said. "Best Buy is at the plateau of the learning curve on this and Circuit City would be at the beginning of the learning curve."
So, they want to be another Best Buy. I agree that their sales people have always been a little pushy, but I must say that I have recieved good customer service from CC, probably because of that.
02-05-03 | 10:45 AM
#3
DVD Talk Special Edition
Joined: Mar 2002
Posts: 1,152
Likes: 0
Received 0 Likes
on
0 Posts
From: Salt Lake City, Utah
Yet many shoppers often are turned off by pressure from salespeople working on commission. And Best Buy continues to take market share away from Circuit City by talking up how its format does not use commissioned sales personnel.
02-05-03 | 12:15 PM
#5
DVD Talk Platinum Edition
I always liked CC better than BB, for overall shopping experience. I never found CC people to be any pushier than BB people, and it has been my experience that CC people are more knowledgeable about their products. Also, my CC is laid out better, and less junky than my BB, and is usually less crowded (of course, this is part of CC's overall problem - fewer customers). CC also has never given me any grief on a return or price match.
If I am buying somethat that both BB and CC have at the same price, I will buy it at CC.
If I am buying somethat that both BB and CC have at the same price, I will buy it at CC.
02-05-03 | 04:43 PM
#6
DVD Talk Gold Edition
Joined: Oct 2002
Posts: 2,134
Likes: 0
Received 0 Likes
on
0 Posts
My problem w/ CC (at least the few I've been to) is that there selection of older releases is ALWAYS low, and that it takes forever and a day to find anything I'm looking for. At BB, five minutes tops to find something. I think their set-up is just alot nicer. As for customer service, CC wins hands down.
02-05-03 | 11:31 PM
#7
Senior Member
Joined: Nov 2002
Posts: 724
Likes: 0
Received 0 Likes
on
0 Posts
From: Illinois
Well, I used to work at CC from 97 to 01 and when I started I was 17 years old making about 15 bucks an hour on comission. My years there were some of the best times of my life. Many of my friends still work there (until today). The only problem is that when they got rid of comission they had to cut their pay for the top sales people. The way the deal worked here in our region is that if you made over 16 bucks an hour you were laid off. EVERY SINGLE ONE OF MY FRIENDS WAS LAID OFF. Even people who have been working there for ten years. Kinda sucks for them and their families.
I know that some people who read these forums work at CC. If you got laid off sorry to hear that and good luck to you.
I know that some people who read these forums work at CC. If you got laid off sorry to hear that and good luck to you.
02-06-03 | 08:30 AM
#8
Senior Member
Joined: Jan 2000
Posts: 489
Likes: 0
Received 0 Likes
on
0 Posts
From: Down South
Not to slight the effect of this move on CC employees but it also screws a deal that I had worked over the phone. The guy I spoke with is probably gone now. My offer to buy an extended warranty on a big TV is of substantially less value to the employee who will be making the deal now. Aw crap!!
02-11-03 | 04:28 PM
#9
Cool New Member
Joined: Feb 2003
Posts: 49
Likes: 0
Received 0 Likes
on
0 Posts
I HATE Circuit City. It's amazing how you can immediately tell when employees are on commission just by walking through the door. You feel like a piece of meat as they size you up.
Best Buy employees are, in general, idiots...but all I ask for when I walk into a store is to be left alone until I'm ready to check out.
I really have no use for "knowledgable sales people" or stores like CC. Any question I have, I prefer to find the answer to through research outside of the store. There are so many websites that review products or feature customer reviews or websites like this one that have message boards full of practical information.
Whether anyone likes it or not stores like (the old) CC are a thing of the past.
That said, it's a very sad thing to the people who worked there and are now "over-qualified." A good friend of mine has worked there for a long time and now I need to call him to see if he still has a job.
And it's also sad for the people who prefer places like CC to BB. I never wished for CC to fall on hard times or go out of business. I just wished not to go there...unfortunately for them, I guess a lot of other people felt the same way.
Best Buy employees are, in general, idiots...but all I ask for when I walk into a store is to be left alone until I'm ready to check out.
I really have no use for "knowledgable sales people" or stores like CC. Any question I have, I prefer to find the answer to through research outside of the store. There are so many websites that review products or feature customer reviews or websites like this one that have message boards full of practical information.
Whether anyone likes it or not stores like (the old) CC are a thing of the past.
That said, it's a very sad thing to the people who worked there and are now "over-qualified." A good friend of mine has worked there for a long time and now I need to call him to see if he still has a job.
And it's also sad for the people who prefer places like CC to BB. I never wished for CC to fall on hard times or go out of business. I just wished not to go there...unfortunately for them, I guess a lot of other people felt the same way.
Last edited by boutitboutit; 02-11-03 at 04:30 PM.
