Circuit City: Will service suffer?
March 28th, 2007Circuit City will fire 3,400 sales clerks because, in the company’s eyes, the $10- to $11-an-hour employees are overpaid.
Circuit City Stores Inc. could save some money by slashing thousands of store associate jobs, but weaker customer service could turn off shoppers, analysts said Wednesday.
The company plans to hire new workers at lower pay. The cuts begin today, so I guess we can expect lousy service to start immediately.
Will this short-sighted, heartless blunder from the nation’s No. 2 electronics retailer amount to a setback for the digital TV transition? The shutoff of analog TV broadcasting is coming in 2009, but many consumers remain confused about how to receive digital TV or high-definition programming. Inexperienced, low-wage retail employees won’t help matters.
Circuit City CEO Philip Schoonover’s total compensation in fiscal 2006, by the way, was $8.52 million. According to my calculations, that’s about $4096 an hour.
• Links: MarketWatch, Bloomberg