I’ve been reading about Circuit City in the news the last couple days. Apparently they have a new strategy to lay off about 3400 store workers that they believe they are paying over “market” wages to. So, these people, who have undoubtedly been good performers for them (which is how they got pay raises) are just tossed out on their ears. That hardly seems like a good business decision. Why would a company throw out many of their higher performers to hire new employees that have to be trained. I think Costco has shown that paying a reasonable wage and benefits has very positively impacted their business. I don’t need to shop in a store with a bunch of ignorant employees that make the same wages as a fast food worker. I expect expertise and knowledge about the products they offer.
So, good luck Circuit City. I hope that your plan fails miserably. I can tell you that you’ve lost some revenue from me.
I would be tempted to agree, but without knowing just *how* egregiously overpaid these workers were, it’s tough to say.
And I don’t get the impression that CC is competing real well with Best Buy and other retailers. Perhaps they took a look at the problems their friends over at CompUSA are having, and decided that they needed to do something drastic, quickly. I wonder if one’s opinion of CC might change if, by laying off 3400 highly compensated-individuals they were able to retain tens of thousands of merely well-compensated individuals?
Who needs to go into the store anyway? We purchased a wide-screen TV from circuitcity.com last year and saved a hundred bucks for the effort.