Circuit City, Claire's and Linen's and Things are just a few companies that have recently declared bankruptcy during this tough economic time. According to fool.com, they predicted Circuit City would fail even before it did. Why? Well according to the website, even during good economic times, Circuit City still struggled. Consumers looked elsewhere to purchase electronics. Preferably, from top competitors such as Best Buy and Wal-mart.
Washington times.com was first to report that Circuit City would be closing it's 567 US stores. Circuit City Stores Inc, which is one of Washington's largest home-grown franchises simply could not clinch a deal to remain in business because it couldn't obtain financing from their lenders or their suppliers. Plus, the competition was extremely high considering Best Buy and Wal-mart are two of it's top competitors.
I believe retail stores fail because of the reasons listed above from the particular websites. Retail stores fail because of steep competition, bad economic times and poor support from suppliers and lenders. Hopefully, the stores that are in trouble, those such as Ann Taylor and Eddie Bauer will pull through this recession and remain in business once things start to look up.
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