Circuit City closing hits 40 employees

Circuit City store manager Joe Johnson

Inside Circuit City late this morning, two walls of big flat-screen TVs were switching among channels in unison. Customers -- not very many on this bitterly cold day, it must be admitted -- were wandering the aisles picking at this and that: TVs, computers, cameras, CDs.

But the sales reps were mostly huddled together, talking quietly about the news they'd just been given by Store Manager Joe Johnson: Circuit City is about to close forever.

The bad news had just arrived: the chain with almost 600 electronics stores in the U.S., and close to 800 in Canada -- with a total of 30,000 employees -- is going to liquidate and shut down. It's stock, worth $41 a share eight years ago dropped to 4 cents this morning.

The Green Bay Road store -- located about 40 feet south of arch-rival Best Buy -- opened in 2002 and has 40 employees. Johnson, who has run it for three years and been with the company for nine, said he's been told an outside liquidation company would come here in a day or so, and prepare merchandise for sale. He expects it to be a "reverse auction," where merchandise is priced at its regular price, and then the price is reduced perhaps 10% each week, until everything is sold.

Customers who have purchased extended warranties for electronic goods will not be affected, he said. Those warranties are handled through a third-party company, GE Assurion, and will remain valid and are fully funded. Normal warranties are provided by the manufacturers. Circuit City will no longer be offering extended warranties.

Johnson was clearly disappointed this morning. "I've got good, good people here," he said. "This store has been one of the top 20 performers in the company, and the Wisconsin District has been the leading district in the U.S.

"We're like a family. If anyone is looking for good employees, they should contact me." Under state law, Circuit City employees will receive 60 days' notice before pay and benefits halt.