Circuit City fired 3,400 of its highest-paid store employees in March, claiming that it needed to hire cheaper help in order to stop hemorrhaging money. It didn’t work. Only a few months later, analysts blamed the ill-advised job cuts for Circuit City’s poor sales.
From the Washington Post, May 2, 2007:
“I think even though sales were soft in March, this is clearly why April sales were worse. They were replaced with less knowledgeable associates,” said Tim Allen, an analyst with Jefferies & Co.
In particular, the televisions showing disappointing results are “intensive sales” requiring more informed employees, Allen said. “It’s a big-ticket purchase for somebody. And if they feel like they’re not getting the right advice or are being misled by someone who doesn’t know, it would be definitely frustrating. They will take their business elsewhere.”
Now Peter, one of the 3400 Circuit City fired, says he’s received a letter from Circuit City offering his job back. Peter writes:
I was one of the 3400 employees let go by Circuit City in March because leading my department to number one in the region for the month of December didn’t mean I was worth $11.35/hour. Whatever, I was quitting to get married and substitute teach in two months anyway, so it was fine with me. Anyway, today I received this letter that I thought was cute:
Dear [redacted],
This letter is a special invitation to rejoin the Circuit City team. We’re a new Circuit City with a lot to offer our customers…and you. If you’re interested – and I hope you are – we have a position waiting for you at any Circuit City superstore.
Over the past eight months, we have improved our customer service model, created new positions, and defined career paths for every store role. This means that at each stage of your career, you’ll know the steps that can get you to the next level. The new Circuit City delivers a superior experience for customers and associates, and that’s why we’re reaching out to former associates like you. You have the skills, talent, and experience required for this level of service, and we want you back.
Be a part of the new Circuit City, and join us just in time for the holidays – the most exciting time of the year. Because of your skills and experience, we’re excited to offer you a position comparable to your previous role at the most competitive rate possible. Simply present this letter to any manager at any Circuit City superstore. We will quickly complete the process and establish you as a regular – that is, not seasonal – associate.
Thank you and we hope to see you soon.
Sincerely, [signature] Andy Grosse – RVP
—–
Yeah, good luck with that, Circuit. If they’re so desperate for good customer service, maybe they should have found a better way to cut labor costs, like assess each store’s staff by merit vs payrate rather than just the latter and then impose a general store salary cap that allows for one or two better-paid salesmen to stay if it drives results. Naw, that’d make too much sense. This *is* Circuit City we’re talking about.
Yes, customer service is important. Especially when you’re selling new technology that people need help to understand, like HDTVs.
Have you shopped at Circuit City since the mass-firing? What did you think?
Circuit City’s Job Cuts Backfiring, Analysts Say [Washington Post]
(Photo:cmorran123)
More From Consumerist
-
The Last Vestiges Of Circuit City To Disappear On Dec. 31
-
$500 Billion Isn’t A Reasonable Amount To Sue For When Your Car Gets Towed
-
Former Spirit Airlines Mechanic: I Was Fired After Complaining To FAA About Service Issues
-
Papa John's Really, Really Cares That They Gave Me Wrong Pizza Crust
-
Florida Man Claims He Shot At Walmart Shoplifter’s Car So Cops Could Find It Later
In the 90s I took a second job at CC selling computers on commission. It was an interesting experience for many reasons but here are some points relevant to Consumerist.
The experienced TV sales guys made the most money. This was 10 years ago and I think they could earn 40-50k if I remember. This is for a job that requires no education. However, it does require sales skill which not everybody has (I learned I don’t have it). On the downside, there was nowhere to go from there and the hours suck.
I worked with a few very clever people who were there part time just long enough to get the employee discount. These were young people with a first house etc. They could buy all their major appliances and electronics at a significant discount and then quit. I don’t know if you can still do this.
never shop at a store or benefit a company that does not see value in their employees. That is the number 1 sign of a bad business. Look at car dealerships for example. Very few in the industry really care about their employees, those stores and companies are almost impossible to find an open position at because no one wants to leave, versus the other 90% of car dealerships out there where turnover is high because the dealer-owner thinks that every person working for them can be replaced at any time. The level of customer service, customer satisfaction, and employee satisfaction are night and day at those different stores…….I used to shop at CC and enjoyed the experience, but I will not shop there now b/c they don’t support the people that support them. A company is NOTHING without good people running it, and that means every employee just just the big $$$ makers on top!
@Myron: The discount, usually 40% above cost, sucks except on some cables and the occasional audio product. Best Buy’s, which is usually 5% above cost, is highly superior.
@PaulMorel: I think it is a gaffe by cc clearly they think they screwed up. Would you rather have 5 hard working good employees or 10 lazy employees for less money? We all know what cc wanted.
@Myron: “The experienced TV sales guys made the most money. However, it does require sales skill which not everybody has…”
Ah, yes. I was working in the computer department many years ago. While the salesperson in the TV department was out (slow day), I went over to look at their TVs.
I noticed quite a number of them were out of calibration. So I fixed the units that were off and normalized all the settings between the televisions.
BOY, WAS THAT MAN ANGRY! It seems that they detuned the televisions that didn’t produce as good of a commission, so that they could more easily steer customers away from them because of their “low-quality image”. LOL.
These TV guys are sales smart! Why didn’t I go back and defocus a few of the low end computer monitors?!
Ex CC employees:
This company left you to starve.While they helped themselves to even more of the money that your work produced,you were a “cost center” that could be deleted with the click of a mouse.Now they are starving (metaphorically,of course). Things must be worse there than they are willing to admit if you are getting letters like these.Here’s my take: Go to a good sporting goods store.Buy a pair of steel toed work boots.Lace ‘em up.Kick the living shit out of this company (metaphorically,of course) from their competition. Payback ‘s a bitch and I cant think of any company that needs a large helping of the big black bird than this sorry sack of bastards. I don’t shop at CC since this story made the news,and I really hope that they suffer for what they put you through.
My CC story. I bought a laptop on line to be delivered for pickup at the local store. Made the huge mistake of giving them my work e-mail (i known, very stupid) instead of the one reserved for online purchases. The CC spam started coming:everyday, sometimes twice a day and no unsubscribe link. It took over two months to get them to quit sending me e-mails
I had a bad shopping experience at Circuit City recently, but in the end we had a manager bend over backward to fix it for us, which I appreciated. I still prefer them to Best Buy because they didn’t flog all the magazine subscriptions/credit cards/extra crap.
Well, if you actually want a store that will tell you what stuff is and how it works stop by your local RadioShack and ask questions. I work at RadioShack and we know our shit. Two days ago I stopped by BestBuy to buy some stuff for my laptop and no one there knew anything at all, thank god I actually knew what I was looking for. And I just thought of people that get taken advantage of when they shop at BestBuy.
I worked at Circuit City for 4 years. I did not get fired, I walked out because of the way I was treated. I was the Lead Customer Service Associate. I did beyond the normal task. I rarely had any cashiers, filled pop and candy displays, scheduled interviews for managers plus receiving all the games, movies and music during the day.
I quit because no only were all the employees who knew anything were gone and my boss was lazy. The day I walked out I became ill. My manager came over and I told him that I was sick and needed to go home. He just looked at me, then walked out the front door and went to lunch.
Just a few months before the people were let go, we worked our tails off moving from a old mini store to a new super store. Some of us were proud of the new store and tried to take care of it. The upper management made it hard on even the store management. Since this happened, the director quit, the road shop manager was demoted and when you visit the store, no one helps you.
Thanks consumerist! I totally forgot about this reprehensible insult to the company’s employees, and I was going to go buy an expensive big screen tv at my local cc this friday. Now that I’m reminded of what shit heads they were to their employees, I think I’ll spend the extra $50 to get the same model elsewhere. That’s not the payback the company’s executive types deserve — they’ll have to wait for the whole “eternity burning in hell” thing to get what they actually desereve. But it will be a couple hundred bucks in profit the company will not be banking this quarter.
I worked at Circuit City for a couple of years. I was doing it as a part time job during college. It was actually a pretty good college job. At the time it was commission sales so most people there were pretty motivated and educated. The commission part shouldn’t be a deterrent from someone buying from the store. It actually is a good thing because if I over sold a customer they would most likely come back and return it. If it was returned the money would come right back out of my pocket and make my numbers look bad. So we tried hard to make sure they left with what they wanted and was did not push people into buying something. (I’m sure it wasn’t always the case, but good sales people know this)
In about 2001 they decided that they had to compete with Best Buy. Best Buy opened all over the place and was taking down Circuit’s numbers. The ingenious CEO’s of Circuit decided it was best to layoff all of the top earner’s because they could not pay them what they were making. I made mid $30k working part-time selling computers during college. Not bad.
It’s understandable that they wanted to be profitable, but I think there could have been a better way to handle this. They basically kept on all the mediocre sales people giving them a decent hourly. They fired all the top earners and people who should have been fired in the first place. Then they started to hire on a bunch of people at minimum wage to fill up the store. From what I heard they started to raise the goals of the mediocre sales people they kept on to something impossible so they had an excuse to fire them. They didn’t want to keep on people at $18-$15/hour when they realized people would do it for much less.
The old Circuit I remember was, at times, a fun environment to work in with good people. They were people who were knowledgeable and gave great customer service. It was a place for college students to earn a buck and this in turn brought good people into the store. With the rate they are paying now it’s obvious to see why the knowledge and customer service lacks. Their CEO’s obviously don’t understand “The Nordstrom Way”.
After a very recent experience with Circuit City, my respect and loyalty for them has been greatly reduced. Still thinking about it makes me cringe about how disrespectful the assistant manager was. This experience is so bad that Walmart and Best Buy are tempting in comparison.
I guess this is the result of their new “cheap” labor. They seem to be hiring inexperienced minors and even more inexperienced managers.
As one of the 4500 fired employees (don’t forget about the further 1000 employees they screwed the next month) I have to admit to having hysterics when I got that letter. My wife threatened me with mayhem if I were to go back. I caught the sneaky phrasing about how they want me back at just over minimum wage also. I suspect that all the truly qualified people caught that phrase they tried to bury in verbal obfuscations.
What they lost in me was someone who could interpret that printer/router question and create a sale out of it.
I seem to be doing pretty well now in my new commission sales job, thank you for asking. In the last 4 months in my new job I have received about 1 week worth of Circuit City abuse.
CC is not the only company to pull off that trying to bring employees back later BS. My wife worked at Walmart. I hated her doing it but she worked in the fabric department and she loved talking to the ladies about sewing and that nonsense.
All the month of December they wanted her to work extra hours and push for big sales with the promise of a big bonus for all employees if they exceeded projections. She did all they asked and was laid off a few days after Xmas. Sorry no bonus for you.
A few months later they contacted her and wanted her back. She was tempted because she missed the sewing ladies but I told her if she went back I would have a major problem with it. If she missed the sewing ladies so much, start a sewing club.
I haven’t bought anything in CC since the layoffs and plan to buy a HDTV soon. I will not buy it a CC (or Walmart). Looks like Costco for me. I hear they treat their employees with respect.
Called my local CC on Wed Crysis came out to make sure it was in stock. Every time I called it rang non stop until the phone was picked up and immediately put down on hold again ringing constantly. Tried throughout the day – exact same thing.
Went there next day picked up a copy went to checkout where an “experienced” sales person was training two others.
The trainer, after I had paid and was waiting for my sales receipt, went to give a couple of apparent employees their checks or related when they came next to me at the counter. The trainees did not know what to do and looked at me with s shrug and an awkward smile as the trainer was chatting with these guys who came up after. I stand there waiting.
You never make a customer wait in person for someone that comes up after them. Perhaps the trainees should train the trainer in proper etiquette.
Yea CC really needs some improvement. Last time for me.
I worked at CC for 2 years and was around when the big layoffs went down earlier this year. In the time that I worked there, the people who worked beside me became my second family, and it was the worst feeling to watch Janice, a woman who was a second mother to me be escorted right out of that building as if the 19 years she had invested in them meant nothing. I cried my eyes out, and just a few months later, turned in my own resignation.
Circuit City is disgusting, and their Northstar is a hallow and empty “commitment”. They don’t care about their employees or families, and they certainly don’t care about the people who become family within their walls.
That letter is insulting and disgusting, and I hope when Janice recieves it, she sends it back with a “f*** you” written across it.
Their going to hire the people who caused me to leave in the first place. Maybe they think we’re all dumb shoppers that won’t notice the old staff are back. Sorry CC, even when you have a good price, someone else will price match.
I worked at CC when I was about 19? back in ’99-’00. Worst job ever.
I went into one a few weeks ago to get my wife one of those 3.5mm cassette adapters for the car for her ipod, you know….. the ones you can get at walmart for like $5-9? they wanted $29.95 for it! I thought it was a mis-ring, but the register jockey let me see the screen…………yep, it was the honest to god price.
I worked seasonally at Circuit City this season… just for a part-time kind of thing, extra money for the holidays. Well, I showed up to work on time every day, took my scheduled break, and did everything that was asked of me. Apparently, working like that gets you fired. The assistant manager that fired me told me they hired too many people for the season, which I knew was false… we were UNDERSTAFFED in our warehouse. So just a couple of hours later, I tried to call the manager to give him a chance to tell me the real reason before I contacted HR, and he told the associate I was on the line with that he had nothing to say to me. I called HR, and was asked to call back. Before I had the chance to, the manager of MY Circuit City called me back, to tell me that I was fired due to poor performance. Really? That’s not what I was told earlier. I have come to the conclusion that they fired me because I was a female in a job usually operated by men. And that’s what I plan on telling my lawyer.
I never shop at Circuit City. Their employees are nothing but a bunch of blood thirsty lairs who made up all kinds of lies so they can sell you those expensive and useless accessories and warratnies. Not to mention those ass managers who never honor their own price match policy.
CC used to be good place to shop with honest and helpful employees. But I guess they all got fired due to “poor performance”, ie not enough warranty sales.
@svreader: CC Employee’s are not on commission.
I still shop at Circuit City myself, but especially at this time when they hire those “Seasonal Workers” who they dont train hardly at all are a bit irritating to deal with. In my area, the seasonals dont even wear the Circuit City Uniform shirts, they just wear red colored clothes and black slacks. So, I always just find the ones with the actual uniforms on when I have questions. Admittedly, the service is a little slack compared to months prior, and I guess it changes depending where in the country you shop, but Best Buy and Circuit City here seem pretty close service-wise.
I used to shop at Circuit City quite regularly, but when I heard about their plan to fire everyone who was being paid well I stopped. I also told all my friends and family to never shop there again and hoped they would go down in flames. My Father actually called me to verify which store he wasn’t supposed to be shopping at this Christmas, and I reminded him.
In that letter to the former employee I didn’t see an offer to rehire her at the previous or better rate.
This is the reason why Best Buy and Circuit City are doing poorly: The Internet.
When you run a web site you don’t deal with shoplifters or two thousand dollars per square foot rentals in Manhattan so you can charge less. Believe it or not but people like to be charged less. Brick and mortar retail is on its way out. Within the next 10 years it will mostly be gone and limited to high markup (ie shit sold to women) stores and services.