Circuit City to close 155 stores by end of year

Circuit City to close 155 stores by end of year

NOVEMBER 4, 2008 - The Richmond, Va.-based company said it will shutter 155 of its more than 700 stores in 55 markets by December 31, laying off about 17 percent of its domestic work force. Circuit City also said it will further reduce new store openings and plans to work with landlords to renegotiate leases, lower rent or terminate agreements.

Two stores in the Jacksonville-Orange Park area will be closing. The Circuit City store at 6155 Youngerman Circle near Orange Park and the one at the OakLeaf Town Center, 9625 Crosshill Boulevard will be closed today for inventory and will reopen on Wednesday with clearance prices.

The move comes as Circuit City heads into a crucial holiday shopping season that could determine its future, amid slower consumer spending that has even the least vulnerable retailers worried.

"The weakened environment has resulted in a slowdown of consumer spending, further impacting our business as well as the business of our vendors," James A. Marcum, vice chairman and acting president and chief executive officer said in a statement. "The combination of these trends has strained severely our working capital and liquidity."

Marcum called the decision to close stores "difficult, but necessary."

Circuit City spokesman Bill Cimino said the decision to exit 12 markets was based on store performance rather than for competitive reasons.