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Fired By Circuit City? They Might Want You Back

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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

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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)

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Comments:

74
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I'm glad this backfired on them.

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I never shopped at CC even before the layoff. In general they never struck me as anything more than a upscale PC Richards or any other commission store.

The problem is, generally, the consumer whos going for a big ticket item is MUCH more informed than the people trying to sell it. Commission sales are 20th century... they should stay there and stores should move to a better model.

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Allow me to be the first of many to say to Circuit City: Bwahahahahahahaha!

Good luck, Peter.

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I heard about the old lady who got canned from circuit city for being "over paid", and I went there once after. I was buying a digital camcorder and "department" manager had absoltely no clue. The camera I wanted didn't have a display...well there was a display model but the display model was broke...what could that possibly say about the camera? This sales associate, and manager couldn't tell me anything more then what was on the box. This kid was maybe 19 years old.


The service sucked but I think a better reason not to shop at circuit city is because they don't support their employees. The problem is we live in a wal-mart age. Everyone wants stuff cheeper. Costs must be cut. Those costs are generally the low level employees problem. If every american decided to not buy products from companys who have mass lay-offs, or outsource employment....we would live in a much better country with a lot more happy customers and employees, and employers. We might pay a little more for our products, but whatever.

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Too bad I don't shop at CC to begin with. This would've given me a reason to stop.

Also glad to see it backfired. Douchebags.

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The VERY LEAST they should have done was offer a signing bonus.

Rehiring folks they canned just by sending a letter is cheaper for them than any kind of recruitment drive.

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I haven't shopped at CC since the mass purge in May 2002. I worked there over the holiday season 2001. It was commission only, and I brought in good money. I found a permanent job and quit just before the purge. They took everyone off commission, and offered them a salary that was around the average commission for a rep.

Hmm. Let's do the math here. Your best performers will be pissed and leave, and your worst performers get a raise. How does that make sense?

I was in the Entertainment dept (TVs, stereos, etc.) The best of us learned everything we could about the technology and the different products, because it closed sales and made us dough. We also pushed accessories, because they had the best commission percentages.

If I am making $11 an hour regardless, why put in more work?

More idiocy...our top seller set up a receiver, hooked one speaker up with standard speaker wire, and an identical speaker up with Monster speaker wire. There was a noticeable difference switching between the two, and we sold a ton of Monster wire with that demo. I was adding a roll of Monster wire to about 75% of my receiver/HT in a box sales. However, this was not part of the authorized floor plan, and we were made to take it down.

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The did the same thing at the CC I worked at in high school 7 years ago, after the holiday sales rush was over they laid off around 30 people because the store wasn't moving enough product, then 2 months later tried to get most of them back.
some employers hint at the fact that you are a disposable employee, but CC makes it painfully obvious.

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I remember going to CC about 3 months ago to look at the tvs. All the tvs were playing ESPN HD and there was a football game going on. An employee was watching the game. I asked him to temporarily switch the channel to an SD channel so I could see the picture quality. I kid you not, he got this pissed off look on his face and most reluctantly went to find the remote. If this is the type of people CC is employing, well good luck to them.

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Wow, stupidity is endless at Circuit City.


Hey guys, your beating Best Buy...and that's not a good thing.

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I used to shop at CC because they were slightly less douche-y than Best Buy.


As it stands now, there isn't one single major electronics retailer where I would be happy walking in the door. The result: it has been easily two years since the last time I bought any sort of gear whatsoever.

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I wish someone inside CC would publish the name of the bean-counter who originally thought the cuts would be a good idea (in the face of overwhelming historical evidence to the contrary).

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Hopefully each and every one of them (assuming they don't already have a better job) writes them back and tells them to go pound sand. Serves them right!

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I'm part of the HighClue set, so I'll just go to Costco or Fry's, and save the money. If I'm going to have nonexistant assistance, I might as well save money in the process.

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I dont shop at CC because BB's return policy is much better. Customer service just isn't about the guy in the company-colored shirt.

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Awesome. I hope exactly 0 ex-employees take them up on that.

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[sarcasm] Wow! Such a well worded letter like that is sure to bring back only the top-notch employees, and not the ones who couldn't find better jobs elsewhere in the market! [/sarcasm]

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Wow, they could have saved a lot of hassle by just reading the internet a couple months ago. I seem to recall the Consumerist running this story when they fired everyone and we all said it was a bad idea. Good going, CC!

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@jurijuri: Well, CEO's know better, don'tcha know! We're just a bunch of ignorant simpletons who don't understand how the "real world" works.

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i was in a circuit city awhile back and was trying to get someone to explane a router system for printers.....i seemed to know more aqbout the subject than anyone in the store, and i know know next to nothing about the subject.....maybe i'll sign up for a job........not.

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Well, as a corporate move, what they did was pretty insane and somewhat despicable. From personal experience, however, the CC near my home (Northern Bay Area) has improved dramatically in the last few years.

I spend a decent amount of money there, mostly because it's close. But almost all the big ticket stuff (picked up a plasma HDTV and 7.1 sound system this year) I'll buy online and pickup at the store. Both times they've offered to deliver the items for free, and most of the sales people are friendly/helpful.

Anyway, long story short, it may be only a tiny fraction of the many CC stores in the country, but some of them are still worth shopping at.

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So, if they're trying to eliminate high-wage employees, and they realized they actually need qualified, modestly-higher-paid sales clerks, shouldn't they now go after, say, the entire executive staff?

Solely to, you know, reduce overhead and pass the savings onto customers. Of course. The lynchings, beheadings and little French ladies knitting while they watch the executives being burnt alive would simply be to add "color" to the proceedings.

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I know a guy who was caught in that purge, who got one of these letters. He sent them back a ridiculous list of demands that they'd have to meet, in writing, if they really wanted him back. Of course, it won't work, but he says he was highly satisfied after hitting send...

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I really don't have much to say about CC. I e-mailed customer service and the top executives (addresses courtesy of the Consumerist) this past sunday after
they had a computer sale that began at 10:00 online on the 18th. I attempted to purchase the Acer laptop and submitted the info several times on their Website and it kept rejecting the info. A few minutes after 10:00 a message came on and said that you could only purchase the computer in a B/M store. It listed stores nearby that had them in stock. I called one in Wadsworth where I had to call 5 times because the first 4 times I was "disconnected". The 5th time I began to give the person my credit card info to purchase the last computer in stock and while he was writing down the info he said that he was not allowed to do a phone order. When asked why, he said that the manager told him so. My last attempt was at the Niles, Ohio store where the manager said that it was on sale online only!


Bottom line: I could not buy the computer online and have it shipped, I could not buy it online and pick it up at a store and I could not buy the computer at a B/M store because I was told that it was on the interernet only. Duh?


I have not received a response from the CC folks as of yet. It would be interesting to hear their response.

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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.

did everyone catch that part?

@Falconfire: i disagree with your assessment. you may know more than the average salesperson, but that would put you in the minority when it comes to the average shopper.

i worked in a commissioned position & i knew more about my products (& comparable products elsewhere in the marketplace) than most people who came in. i could spout numbers on any model as quick as someone could query, but more importantly, i could tell you why i thought this particular model was (or was not) the best investment for you.

of course, i invested the time to find out about the poducts (& the shopper) & used my free time at work to look up reviews online, so maybe that's just me. but i tend to think that a commissioned worker has more incentive to provide you with a better experience. the wage worker doesn't care to learn more b/c he'll never earn more. to quote a personal hero: "But you know, Bob, that will only make someone work just hard enough not to get fired."

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That letter just about sums up everything that's wrong with Big Business in America today. Burn in Hell, Circuit City. Costco, Amazon, and the local Custom TV and Stereo store get my business these days.

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They did the same thing a few years ago when they got rid of commissions. I was working at Best Buy at the time, and we couldn't figure out why the nearby Circuit City was closed that morning. We found out in the afternoon what went down. A lot of their people ended up getting jobs at Best Buy after that. A friend of mine was one of them to get fired because he was making something like $20 an hour with his commission.

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haha karma's a BIATCH. stupid assholes, the same is with Teavana. don't ever shop there. I was one of the last employees to actually work with the owner and lemme tell you, he's the biggest fattest (and I mean fat as in morbidly obese) greediest money grubbing fuck ever. he has no concern for his employees and chooses to let competent people go because they have good ideas that make him look bad and he refuses to pay them what they are worth. this in an environment where a highly trained salesperson is way more productive than a noob, I mean seriously who knows shit about tea? I didn't til I had to write the training manual

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@HOP: "i was in a circuit city awhile back and was trying to get someone to explane a router system for printers..."

Erm...I've worked in IT for years and can't think of a single thing I would be able to call "a router system for printers." No wonder they were confused.

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The problem with what Circuit City did, and with the way Best Buy treats their customers on a day-to-day basis is that there are so many other options, it can make your head swim. If Circuit City's management acts like jerks, there are dozens of other places in town & hundreds online. They all match each other's prices, so it really does come down to ethics and they way they treat the customer.

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Crutchfield and Amazon FTW!!

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did everyone catch that part?

@mac-phisto: I'm sure everyone they sent a letter to caught it.

They want these people back but aren't even willing to say that they'll get their old job with the same pay they had before. "Oh, it'll be a similar kind of position with pay somewhere around what other people are paying. Isn't it exciting?!?!"

I hope at least one person mails back a picture of a giant middle finger.

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@Indecision: You, sir, win two free Internets. Please provide your address and they will be shipped, free of charge, via FedEx ground.

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@HOP: "i was in a circuit city awhile back and was trying to get someone to explane a router system for printers..."

@Indecision: "Erm...I've worked in IT for years and can't think of a single thing I would be able to call "a router system for printers." No wonder they were confused."

Networked printer, possibly a wifi printer. If the sales associate was knowledgeable they would have figured out this person was wanting to share a printer and helped him with options. (WiFi printers are pretty cool.)

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This explains a lot.

When my boyfriend's computer died in October we needed to get him a new one immediately (computer=life; you know how it is). We price compared online and found that there was a model he was interested in for a pretty decent price at the Circuit City on La Cienega in LA. We drove over there and promptly waited for a full hour before we could even get the attention of an employee. I think we were there for about 20 minutes before I even SAW an employee. When we did get someone to help us, it took half an hour for them to find the keys to unlock the case of laptops. Thank god we didn't have any questions about the computer itself. Even Best Buy, which I loathe, looked good compared with Circuit City.

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After Circuit City engineered this debacle I refused to shop their any more. I don't read their ciculars in the Sunday paper. If I come across any of their offers on the deal sites I follow, I ignore them.

There has to be a penalty for stupid management.

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@Indecision: translation: print server. not everyone noes teh lingo, r0x0r.

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I'm positively 1000% sure that all those employees CC laid-off spent all the time next to the phone, just waiting for CC to call them back in.

Oh absolutely sure...yessiree.....

/sarcasm

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I was one of the "Laid off" and I received the letter recently. I went into my old store to see what the deal was and they offered me my old job with an additional $1.15 and hour. Plus now they are offering additional spiffs on products they concider "High Margin" so that we will sell products that make the company money. They are also making me go through another training so I am up to dat with all of the new technologies like 1080p and 120hz TV's. I took my old job back and hopefully things will work out better.

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No offense to Peter or any of the other well informed sales people who were laid off, but I honestly take the advice I get from anyone working at a retail electronics shop with a big serving of salt anyways. If I'm going to drop over $100 on something, I'm going to research it's features, capabilities, and reviews myself. When I go to the store, I'm either looking at the product for my own "hands on" demo, or I'm ready to buy.

And yes, I realize not everyone is as thorough as I am...but I don't understand how someone can go and spend over $1000 on a TV and trusting only the guy at the store to tell them they're getting a great deal.

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11 an hour is barely a living wage imo. I very much hope that when these "overpaid" salespeople got fired, it turned into a blessing in disguise by getting better gigs.

Maybe this is the start of a new trend of companies working FOR the customer rather than against. We'll see I guess.

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@Sparkstalker: Peter here.

Good for you. There's nothing I liked better than someone who came in and actually knew what they were talking about. It made my life easier, and theirs as well because if there was a gap in what they knew I could communicate with them easier since there was a jumping off point. Sometimes there was a gap in what I knew as well and I could learn from the customer (a rare occurance, but it happened.)

One of the things I always tried to do myself - and train others to do, since that was a large part of my job - was to show my knowledge to customers and let them understand that I actually knew what I was talking about. Not only about the merchandise, the vendors and our company processes but also the marketplace: our competition, the future of the industry and especially the at-home options, such as the channels available in HD on D*, E* and cable. It wasn't necessarily going to win over a customer who understandably doubted that I was working in their best interest, and it shouldn't. But at least they knew they were dealing with a competent individual who wasn't reading off a tag, something CC and its brethren haven't bothered to train for on an official level for quite some time now. It's the little things like that which can make a sale: anyone can look up whether a TV has one or two ATSC tuners, but knowing Charter's HD channel lineup for a customer that just has basic cable can make a big difference.

The other issue of trusting the salesman not to sell you something just because the company wants them to is, unfortunately, trickier in any sales environment. That's where your knowledge comes in handy; most people that knew their stuff well could see I was just trying to get them the best deal. Our cheap stuff was usually crap; our expensive stuff was, in most cases, more than they needed. They knew it, saw that I knew it, and the rest was a good sales history.

At least until March.

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I went to CC to buy Halo 3 the day after launch. You know, the day after the entire world heard about a game called Halo 3 being released and every store being completely plastered in Halo 3 material. So I go to the counter and ask the CC rep for one copy of Halo 3, and I get back a confused and somewhat vacant stare, followed by a "what is that?". I pointed to the enormous display case about two feet behind her, set up solely for Halo 3.

"Oh, one of those things. OK. Do you want the more expensive one?"

Yeah. I can tell you're one of their star reps.

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Wow, that is tasteless.

Hey, Andy Grosse, do you realize how offensive it is, after you fire someone to make a buck, to then send them a letter in condescending PR-speak about how you are offering THEM an opportunity to join your "team."

I imagine these corporate pinheads have some fancy business degrees or somesuch, but are they that completely divorced from the rest of humankind that they don't have an ear for how insulting and hollow this kind of language is?

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@quail: "Networked printer, possibly a wifi printer."

I figured it might be something along those lines, but there's still really no way to tell. Though you're right that a good salesguy would have been able to determine it from conversation. Personally, I would have started asking questions about what sort of end result he's looking for, and infer it from there.

But someone asking me for a "routing system for printers" is going to get an initial reaction of "Huh?"

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If I were one of these techs. I would only come back on the confirmation that the manager than came up with the idea to fire the 3400 in the first place had his job publicly terminated.

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I don't want to sound cynical, but this wasn't a 'gaffe' by Circuit City. It was a strategy for cutting the salaries of some of their employees. This is made obvious in the line that everyone is pointing out, "we're excited to offer you a position comparable to your previous role at the most competitive rate possible".

In other words, "We're glad we got to dump your salary for two months! Now, we're happy to offer you the paycut that we didn't have the balls to offer you before!"

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@PaulMorel: It was a gaffe because the company, like many in retail, thinks all success comes from Richmond, VA and all failures come from YourTown, USA. They thought they could cut the higher paid, bring in cheaper help, and those employees would be as good as the ones dismissed as long as they followed the edicts from corporate. They don't really believe that success lies in having good associates as much as people in the box that follow their instructions, when in fact our success usually was a result of the opposite.

There's the smallest amount of sense in bringing in lesser paid folk when you consider that all the fired employees were once new off the street. And it's not true that all good employees were fired, just that a great number of them were. However, most of the good ones took time to get to where they were, meaning in the interim you have a floor filled with inadequate help - and no veterans to train them to be better in a hurry. Plus, the new employees - and the good ones that remain - now work for a company that showed just how hard work will be rewarded, meaning their morale is circling the drain.

The company's results were even worse than they thought, very few of the fired returned, and they're having problems with labor across the board. So they're retreating and trying to get some of the released back to stem the bleeding. Too late.

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@Indecision:

Part of why technical sales people should be paid more is that they do have to deal with the typical user who knows nothing about IT.

"I want a routing system for a printer."
"That doesn't exist!"
End result: No sale.

"I want a routing system for a printer."
"Are you trying to print to one printer from two or more computers?"
"Yes."
"OK, I have some options for you. *give options, possibly including a tech visit to configure a shared printer or an external print server*"
End Result: Sale.