Common Cutbacks

The nation's second largest electronics store announced plans to Monday. The news came just one week after the company decided to , eliminating somewhere in the vicinity of 8000 jobs. Monday's announcement also indicated could be on the way.

How serious could those cutbacks be? Just ask Circuit City's competitors. Electronics chain Tweeter is in the process of right now, about one year after it filed for bankruptcy. And CompUSA at the start of the 2007 holiday season. Only 16 locations remain open today, following a earlier this year. Sharper Image, Mervyn's, and C-Mart have also shuttered their businesses in recent months, and even Best Buy -- the relative winner in its league -- has seen shares drop this year.

Troubling Trends

Some players, including Circuit City, point to the current economic climate as being the catalyst for the electronics retailing meltdown. Others blame from general discount stores such as Wal-Mart, while others yet point the finger back at the . Each contention has its own merit -- and, in reality, the problem is likely a combination of all three.