Systemax Revives Circuit City Brand OnlineBy Lawrence Walsh | Posted 2009-05-26 Email Print
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The defunct computer and electronics retailer Circuit City finds new life as an e-commerce portal in the portfolio of Systemax, which bought the online branding rights for $14 million. Systemax also owns direct-market reseller TigerDirect and computer retailer CompUSA.
Defunct computer and electronics retailer Circuit City is being resurrected as an online retailer by Systemax, the parent company of CompUSA and direct-market reseller TigerDirect.
Systemax, based in Port Washington, N.Y., acquired the rights to CircuitCity.com for $14 million plus a percentage of revenues generated by the site over the next 30 months.
"Circuit City is one of the iconic brands in U.S. electronics retailing with a 60-year legacy. With the longstanding leadership of our TigerDirect.com business and the growing contribution of our CompUSA business acquired last year, we think Systemax is uniquely positioned to best carry forward the great Circuit City brand in the online space," said Richard Leeds, Systemax’s chairman and CEO, in a statement.
Circuit City, once an electronics retail powerhouse, declared bankruptcy last fall and completed its liquidation of retail assets in February. The closing of Circuit City resulted in the loss of more than 35,000 jobs. The company’s failure also resulted in the shuttering of consumer and small business IT support service FireDog, a service created by Circuit City to compete against rival Best Buy’s Geek Squad.
The new CircuitCity.com carries electronic goods ranging from flat panel LCD televisions to notebook computers to data networking gear. Systemax says the site will feature low price goods, fast shipping, 24/7 customer and tech support, and user reviews and ratings of products.
While demand for IT goods remains sluggish, Systemax is bucking the trend with relatively healthy growth in consumer sales. In its recent quarterly earnings report, Systemax reported sales grew 4 percent globally and 21 percent in North America. Profits were up more than 14 percent, despite a 20 percent decline in business technology sales.
"Market conditions are challenging, but we are growing share and attracting customers," said Gilbert Fiorentino, chief executive of Systemax’s Technology Products Group, in a statement. "We are price-competitive and that's a necessary ingredient of success in our business. This strategy enables us to build a long-term and loyal customer base."