I know I will endure the wrath of many contributors to “Talkback” by writing this: Phil Schoonover, who left Circuit City as chairman, president and CEO on Monday, is not entirely to blame for the chain’s problems.
Circuit City experienced years of questionable decision-making before Schoonover got there in 2004 and took the top jobs in 2006.
Here are some costly decisions prior to his arrival:
- 1997 — Divx pay-per-view disc format, backed by Circuit, which eventually costs the retailer tens of millions (if not more);
2000 — Circuit drops a core category, major appliances, just as the market is about to explode at retail. National competitors and independents benefit as Circuit City moves to low margin “grab and go” CE products;
- 2002 – CarMax, its profitable used-car chain, gets spun off by Circuit. The car retailer is still alive today and profitable.
- 2003 — Circuit fires many of its commissioned sales force, which again helps independent retailers who hired their ex-employees and made plenty of its suppliers wonder why it was still selling to the national chain.
Sure, Schoonover made plentyof his own mistakes. He was hired to turn things around, which he didn’t.
But plenty of damage was done before he got there.
More on Circuit City will be posted Monday, Sept. 29, when its quarterly financial is scheduled to be released.