Circuit City Liquidation Case Study

Company profile

Hyper Microsystems, established in 1996, is the leading stocking distributor of new, refurbished, OEM and used IT equipment and computer components. Hyper Microsystems is an expert in reverse logistics and liquidation business. We implemented multiple level process controls to better manage repackaging, refurbishment and overall recovery of consumer electronics and computer hardware and systems. Through strategic partnerships with Intel, Dell, IBM, Gateway, Seagate and other major manufacturers we are able to constantly provide competitive prices and exceptional service to all our clients worldwide.
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Situation

In November of 2008, Circuit City filed for bankruptcy protection and was looking for other options, including a possible sale. By January of 2009, Circuit City started searching for a company to efficiently manage the final liquidation of its inventory. The company was paying $50,000 a day in rent and needed somebody to be able to move the inventory very quickly. The challenge was to find a company who could provide one comprehensive solution for numerous inventory categories.

Hyper Microsystems was able to successfully coordinate the logistics of consolidating the entire remaining inventory of 440,000 items or 350 truckloads at the 7 Circuit City regional distribution centers into our warehouses in Chicago in 10 business days. Hyper Microsystems operates smoothly in fluid, fast-moving purchasing processes. On the Circuit City transaction, not only did Hyper Microsystems fund both the deposit and the balance of the Purchase Price promptly, it also vacated the premises of the 7 distribution centers significantly ahead of schedule which resulted in additional savings for the estate.

Circuit City Project exemplifies how Hyper Microsystems Inc handles projects of any size. Purchasing all customer returns valued at roughly $100M retail from Circuit City distribution centers, Hyper Microsystems Inc team ensured ahead of time that necessary processes, trained personnel and warehouse space were immediately available.

Benefits

Handling many new categories of products from Circuit City has led Hyper Microsystems to expand the business of refurbishing consumer electronics and processing them for sale. To maximize recovery value, returned assets are sorted, inspected and tested to determine the depth of refurbishing requirements according to manufacturer specifications. Hyper Microsystems has the capability of processing, repairing and remarketing of consumer electronic products on a large scale, offering companies the highest return for their inventory.