Relevant Circuit City DD from their 2nd q 10QSB :
MY PREAMBLE :
GnF partnership with CC appears to be a mutual strategy for growth . GZFX investors should think outside the ' BOX ' of GnF being the more needy or desperate of the two partners , where this is a symbiotic partnership where EACH company needs the other , IMO . CC is in a highly competitive market and GnF offers additional growth to CC . Another BIGGIE for CC is the additional customer base they acquire via GnF customers for all of their other products . EVERY customer counts , in the consumer world of garnering customer loyalty .
If you read CC's second quarter 10QSB you will observe a clear focus on their Canadian acquisition of Radio Shack and their clear desire to make those over 900 stores competitive and profitable . With that in mind , CC has a VESTED interest in their GnF partnership working viably , insomuch as they have +900 more Canadian stores to benefit as well . The best marriages exist where BOTH partners need each other equally .
It is my assessment that CC needs GameZnflix as much as GameZnflix needs Circuit City .
Taken from CC's 2nd quarter 10QSB :
FISCAL 2006 OUTLOOK
Our strategy for improving our operations, financial performance and shareholder value includes the following:
o upgrading processes, systems and talent to improve the core business
o evolving the core business to generate incremental revenues and profits
o innovating to create new businesses, related to our core business, to produce long-term growth
Key initiatives to upgrade the core business include the following:
o store revitalization program
o promotional and marketing effectiveness
o product transition and pricing management
o multiple sourcing alternatives
o inventory management, including improved customer-encountered in-stock levels and reduced net-owned inventory
o collaborative vendor relationships
o information systems enhancements, including a company-wide data warehouse, as well as improved supply chain, merchandising marketing systems
Key initiatives to evolve the core business include the following:
o portfolio management of merchandise product categories, matching our investments in merchandise product categories with the strategic intent of the specific business
o expanded service offerings, including expanded PC Services offering nationwide
o continued investment in Circuit City brand awareness and in marketing by our Circuit City Direct business, ensuring a consistent multi-channel brand
o improved customer experience led by Associate engagement
o reduction of performance gap between the best and the poorest performing stores
Key initiatives to innovate include the following:
o win in home entertainment - be the retail destination for home entertainment products and services
o digital home services - develop breakthrough consumer electronics service offerings
o multi-channel retailing - move focus from transactions to relationships and provide solutions to customers wherever they want them
Based on our performance during the first six months of fiscal 2006, we updated our fiscal 2006 outlook.
We revised the range of expectations for total sales growth. We now expect total sales growth of five to eight percent. The previous expectation was total sales growth of three to six percent.
We revised the range of expectations for the domestic segment's comparable store sales growth. We now expect domestic comparable store sales growth from the low- to mid-single digit range. Our previous expectation was comparable store sales growth in the low-single digit range.
We reaffirmed the range of expectations for operating margin (earnings from continuing operations before income taxes as a percent of sales) of 1.3 percent to 2.3 percent.
The fiscal 2006 outlook is based on the following assumptions:
o continued sales growth in flat panel televisions, portable digital audio players, digital imaging and PC services
o sales growth in the international segment
o approximately 25 to 30 new and relocated Superstore openings
o more effective advertising and promotions to drive traffic
o an improved customer experience to increase the close rate
o enhanced customer-encountered in-stock levels
o continued growth in our Circuit City Direct business
o a stable macroeconomic environment
To bite the worm of incite is to bite the HOOK of the antagonist . They win .
