Worker value-add?

Layoff the long-time, experienced salespeople and sales seem to mysteriously decrease tremendously.... wow, who would've figured this would happen !??

The article, and by inference the CEO, seemed to blame low consumer demand and perhaps the general state of the economy for the poor sales. Then they mention, seemingly out of nowhere, that they would:

Schoonover said the company will pay attention to giving sales associates the "necessary knowledge and tools needed to improve both sales and margin." The company had laid off 3,400 high-paid workers and replaced them with lower-paid new hires in March

Seems like a lesson that modern execs do NOT get, i.e. that experienced technical people that are actually doing work on the ground, have significant value-add for a corporation and may be responsible for a significant contribution to company profits. Individual people's skills are important. But in an era where execs are trying to commoditize jobs and lower pay for the affected workers, by hiring cheaper workers here or via globalization, overseas, there occasionally are instances that prove the lie to this new accepted economic assertion.

This economic fad will prove disastrous in many cases and , like 'new math' , will cause suffering for those adversely affected by it until it's adherents quietly accept the failure of it's theory.

They now indirectly acknowledge that firing all that 'experience' was wrong and now seek to fix this by trying to stuff experience quickly into the new hires!? Some things take learning but also smarts gained from actual experience.

Obviously they layed off the wrong group of people for a Circuit City turnaround.

Circuit City same-store sales fall 11%

December sales down for electronics retailer, reaffirms fourth quarter guidance.

January 7 2008: 6:59 PM EST

RICHMOND, Va. (AP) -- Electronics retailer Circuit City Stores on Monday said same-store sales fell 11.4 percent in December, as strength in the final two weeks of the month failed to offset declining sales of tube televisions, camcorders and other devices earlier in December.

Based on its sales results, the company continued to back its forecast of a "modest loss" before taxes for the fourth quarter, despite America's traditional holiday hunger for televisions and other high-tech gadgets.

"Our sales performance, while disappointing, was in line with our expectations," Chief Executive Philip J. Schoonover said in a news release.

Schoonover said the company will pay attention to giving sales associates the "necessary knowledge and tools needed to improve both sales and margin." The company had laid off 3,400 high-paid workers and replaced them with lower-paid new hires in March.

Attention also will be paid to expanding sales of Firedog, the company's PC services and home-installation business, Schoonover said.

The company said comparable domestic sales decreased for televisions, camcorders, DVD hardware and digital imaging products. It saw the most strength in video games and navigation devices.

Same-store sales, or sales at stores open at least a year, are a key indicator of retailer performance since they measure growth at existing stores rather than from newly opened ones.

Shares were unchanged at $4.21 in after-hours trading.

For the month, the company said significant sales decreases in tube and projection televisions more than offset high single-digit sales growth in flat-screen televisions. Sales of camcorders and DVD hardware fell by double digits.

Revenue from Firedog increased 15 percent, Circuit City said. Sales of extended warranties were $36.1 million, compared with $52 million in the same period last year.

Domestically, Internet and call center sales grew 17 percent in December, the company said.

Last month, Circuit City reported a wider-than-expected loss for the third quarter, driven by lower extended warranty sales and restructuring costs. Circuit City had also said it has received a commitment to more than double its $500 million credit line to $1.3 billion.

Analyst Chris Horvers of Bear Stearns said the results fell short of expectations, partly due to the softening in flat-panel TV and notebook computer categories.

"Circuit (City) is a show me story right now and I think the management team has to show that their plan is going to work," Horvers said.

Unless there's some improvement in the first half of next year, Horvers said, investors will look at the stock skeptically, including seeing risks of it going out of business.

For the three months ended Nov. 30, Circuit City's losses ballooned to $207.3 million, or $1.26 per share, from $20.4 million, or 12 cents per share, a year earlier. Excluding tax-related accounting items, losses totaled 64 cents per share in the latest period.

Sales slipped 3 percent to $2.96 billion from $3.06 billion a year earlier, with sales at stores open at least a year falling 5.6 percent.

"Our efforts to turn around the business have led to greater disruption than we anticipated, but we continue to believe that we are on the right path to return to sustainable, profitable growth and increasing shareholder value," Schoonover said in Monday's news release.

Circuit City (CC, Fortune 500) announced last month that it approved millions in cash incentives to retain its top talent following the departure of several key executives over the past year. Executive vice presidents could claim retention awards of $1 million each and senior vice presidents could get $600,000, provided they stay with the company until 2011, according to a filing with the U.S. Securities and Exchange Commission.

Rival Best Buy (BBY, Fortune 500) is scheduled to release its December sales figures on Friday.h

Attention also will be paid to expanding sales of Firedog, the company's PC services and home-installation business, Schoonover said.

The company said comparable domestic sales decreased for televisions, camcorders, DVD hardware and digital imaging products. It saw the most strength in video games and navigation devices.

Same-store sales, or sales at stores open at least a year, are a key indicator of retailer performance since they measure growth at existing stores rather than from newly opened ones.

Shares were unchanged at $4.21 in after-hours trading.

For the month, the company said significant sales decreases in tube and projection televisions more than offset high single-digit sales growth in flat-screen televisions. Sales of camcorders and DVD hardware fell by double digits.

Revenue from Firedog increased 15 percent, Circuit City said. Sales of extended warranties were $36.1 million, compared with $52 million in the same period last year.

Domestically, Internet and call center sales grew 17 percent in December, the company said.

Last month, Circuit City reported a wider-than-expected loss for the third quarter, driven by lower extended warranty sales and restructuring costs. Circuit City had also said it has received a commitment to more than double its $500 million credit line to $1.3 billion.

Analyst Chris Horvers of Bear Stearns said the results fell short of expectations, partly due to the softening in flat-panel TV and notebook computer categories.

"Circuit (City) is a show me story right now and I think the management team has to show that their plan is going to work," Horvers said.

Unless there's some improvement in the first half of next year, Horvers said, investors will look at the stock skeptically, including seeing risks of it going out of business.

For the three months ended Nov. 30, Circuit City's losses ballooned to $207.3 million, or $1.26 per share, from $20.4 million, or 12 cents per share, a year earlier. Excluding tax-related accounting items, losses totaled 64 cents per share in the latest period.

Sales slipped 3 percent to $2.96 billion from $3.06 billion a year earlier, with sales at stores open at least a year falling 5.6 percent.

"Our efforts to turn around the business have led to greater disruption than we anticipated, but we continue to believe that we are on the right path to return to sustainable, profitable growth and increasing shareholder value," Schoonover said in Monday's news release.

Circuit City (CC, Fortune 500) announced last month that it approved millions in cash incentives to retain its top talent following the departure of several key executives over the past year. Executive vice presidents could claim retention awards of $1 million each and senior vice presidents could get $600,000, provided they stay with the company until 2011, according to a filing with the U.S. Securities and Exchange Commission.

Rival Best Buy (BBY, Fortune 500) is scheduled to release its December sales figures on Friday.