Case Study Of Circuit City: The Failure Of Wards

Superior Essays
Circuit City
The Failure of Circuit City
Jake Johnston
Mars Hill University Abstract Circuit City started out in 1949 as “Wards Company.” Within ten years, the store brought in $1 million per year. In 1965 Wards expanded through the acquisition of other television and home appliance stores; their move of horizontal expansion helped with their success. In 1984, Wards became Circuit City Stores, Inc. and became publicly traded on the New York Stock Exchange. From the year of 1949 until 2009 Circuit City was one of the leading consumer electronics retailers in the world, but with several poor business decisions in the early 2000’s, it filed for Chapter 11 bankruptcy in 2008 and closed in 2009. This paper will look into the decisions made to see if the failure of the company could have been avoided. Management
Introduction
Circuit City was established in 1949 under the name of Ward’s Company; it was one of the first electronics superstores in the United States (Hart). Wards grew moderately and within ten years, Wards became a four store chain that brought in $1 million a year (Hart). In 1965, Wards began expanding horizontally buying out several other television and
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Because of management decisions to do things the cheapest way possible in getting their out-of-the-way real estate in 2004, this gave their customers no reason to go to Circuit City instead go to the better placed Walmart or Best Buy (Hamilton, 2008). The management part of Circuit City was terrible in their decisions, they stopped selling their appliances, did not move as aggressively into gaming as it should have, and missed out on big in-store promotions with companies like Apple Computer (Hamilton, 2008). With these decisions to not be aggressive, this gave their competition the upper hand over Circuit

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