Die Circuit City, Die!

I tend to have a somewhat contrary viewpoint when it comes to a certain economic conundrum we all find ourselves in. Even to this today I remain a bit of a right wing, laissez faire, free(er) market kind of guy with little government intervention. I hate the bailout package. I believe companies who perform and make bad decisions poorly should be allow to die and allowed to die hard. Now without going into the sensitive issue of when those companies actually happen to be commercial banks that are responsible for lending the U.S citizenry money and keeping track of our virtual tender, I'll describe one company I'll be happy to see fade into the abyss or get swallowed and consequentially transformed because it sucks and deserves to lose - Circuit City.

Growing up as a video game playing and heavy metal music loving teenager near Jacksonville, North Carolina, I was pretty elated when we actually got a Circuit city. It was essentially the super-store for the combination of my two high tech loves in my little part of the world.

But in going to that particular branch store in Jacksonville, I either didn't realize, or witness the decay of, the quality of their customer service. I never put much stock in to shopping atmospheres or service quality when making purchasing decisions until I get fed up with Wal-marts who pepper you with employees who speak with poor grammar, always look scraggly, maintain dirty and dingy looking stores, and somehow seem to attract legions of mothers who feel compelled to bring their less-than-five year old children to the store who can do nothing but pierce my ear drums as they cry at the top of their lungs¹. As I've come to find out, Circuit City is sort of the Wal-mart of electronics retailers. Here are the features I've observed in each of the 4 or so Circuit City's I've set foot in for the last 5 years (Jacksonville-NC, Charlotte, San Jose, Emeryville):

1. Staff who are very sassy and don't' talk to you as if you actual are a customer in their store
2. Staff who ignore you, continuing what piddly conversation they are engaged in with a co-worker when you are looking their way to ask a question
3. Stores that are cramped
4. Shelves that are disorganized
5. Dingy looking floors
6. Prices that are starkly *higher* than competitors (most comparisons I've made have been at least $5 every time in a direct comparison to Best Buy).

In that list, number 6 is excusable if Circuity City maintained a competitive advantage elsewhere. Unfortunately Circuit City does not have any competitive advantage whatsoever. It is like the company is fully aware they suck and do nothing to separate themselves from the competition - or do they realize how bad they are? Earlier this summer Circuit City basically gave contract extensions and raises to a sizable chunk of their mid-upper management to make sure they stuck around. It is as almost if the C-level guys in that company WANT to positively reinforce negative behavior.

The final straw came for me this past summer, as I took a bus to the Circuit City in San Jose, which was right off of a bus stop, to pick up a pair of headphones and a case for my Sansa Rhapsody mp3 player. The items were a relatively paltry purchase, but still a purchase nonetheless. I walked to the unattended check-out counters expecting a worker to disengage from a conversation they were having with other colleagues (it was a slow day and they were all shooting the bull with each other). I stood for about 1.5 minutes waiting on one of them, when it dawned on me that I'm either not standing where they expect me to check out (despite there being a counter with a cash register/POS terminal turned on) or that they just didn't flat out give a hoot whether I bought anything or not. I could have spent a fraction of calorie's worth of energy to walk up to one of them and ask where I needed to check out, but I decided not to. I could not fathom giving my money to a store with such porous of service when there are other competitors who I'd rather see get my money. So I voted with my feet and with my dollar, walked 1/4 of a mile to a Best Buy, made my purchase (and *gasp* the workers there actually smiled as they helped me there) and I've been doing the same ever since.

So to Circuit City, I hope someone eulogizes you when you die or get swallowed up. It will not certainly be me.

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1. Those babies are probably all crying as they too do not want to be in Wal-Mart.

Thanksgiving Hangover

Thanksgiving dinner rocks. Remorsing over my belly the next day... not so much. Periodically I'll do an evaluation of myself and realize that I'm starting to get a little bit out of shape and inactive. It just so happens that this time it occurs the day after I stuffed myself with a good 4,000 calories of food through the 24 hour period.

But oh was that pecan pie good! Now it is time to go run it off :)

My Book Meme Post

Using aerobic activity to help you get cut up makes sense.

The rules for this meme thing are :

* Grab the nearest book.
* Open it to page 56.
* Find the fifth sentence.
* Post the text of the sentence in your journal along with these instructions.
* Don’t dig for your favorite book, the cool book, or the intellectual one: pick the CLOSEST.

This excerpt came from The Encyclopedia of Body Building by Arnold Schwarzenegger, which just happens to be the first book on my book shelf - followed by a few tech books :)

Economy Trimming a Good Thing?

Perhaps our little economic downswing will give us a chance to trim the fat. All of the media focus, as I've seen it, has been on the housing/mortgage collapse which has in-turn sent our banks into a huge downward spiral with the rest of us bailing those lending banks out. I've got relatively strong opinions about it, but the end result is that some of the banks that took these risks die out or get bought up (already happening), the banks who managed it well come out on top (read: JP Morgan Chase, etc.), and that perhaps we get some sane legislation that keeps future risky loans (of any kind!) from bouncing around like hot potatoes. I love capitalism, but you can't let it run completely unchecked - or so my reading of Thomas Sowell tells me.

After reading the weekly Vanguard Economic report, I'm a little further convinced our downswing might do some good after all. I'll let this section of the report do the talking:

Productivity in the nonfarm business sector increased 1.1% in the third quarter, a bit better than expected but below the 3.6% growth rate in the second quarter. The Labor Department's preliminary data showed that hours worked fell significantly more than output. The surprising rise in productivity during an economic slowdown may indicate that businesses are more nimbly managing their workforces. "This shows the economy was weakening well before the financial events of late September," Mr. Aliaga-Diaz explained. Unit labor costs increased more than expected (at a 3.6% rate in the third quarter compared with a decline of 0.1% in the second quarter), but analysts are not concerned about inflationary pressure from wages. On a year-over-year basis, productivity gained 2.0% and labor costs rose 2.3%.

Essentially, what this tells me is that businesses themselves are also trimming the fat and as a result, will probably become more profitable and eventually more competitive globally. I've actually observed this personally myself at my own employer, and I welcome it.

While he probably delivered it poorly, when John McCain delivered his line during the campaign that the "economies fundamentals were strong", I don't think he was being insincere, just perhaps narrow-minded. Large business outside of the financial sector seem to be doing A-OK to me (I'm still buying stock right now, fwiw) - their balance sheets are fine. It's the balance sheets of the consumer that are out of order. Unfortunately this means less spending power for the consumer which will ultimately result in less revenue for businesses, and most likely price drops. But this also has the inverse effect of making our exports more attractive, which is a trend I'd LOVE to see happen. That prediction along with that report from Vanguard actually makes me optimistic now for the longer-term.