The Wall Street Journal reports that electronics retailer Circuit City is facing a very tough decision: either close 150 stores, or file for bankruptcy protection.
A decision to declare bankruptcy could have a major negative effect on the company, potentially eroding consumer confidence in the retailer and raising doubts about whether the company would be around to honor warranties and other deals. While closing a large number of stores could raise many of the same issues for consumers on a local level, it could also produce a short-term holiday windfall both for the company and consumers, since the company could use the move to generate an estimated $350 million in revenue through job cuts, reduced real estate costs…and liquidating inventory.
