Circuit City set to close stores

Circuit City is going to reduce its workforce

US electronics firm Circuit City says it will close about 20% of its US outlets in a bid to return to profit.

The firm said it would shut 155 out of a total 700 stores by the end of December. The move will mean cutting 17% of its US workforce.

Circuit City faces tough conditions with consumers cutting spending in the downturn, sending second quarter sales down further in September.

Best Buy recently said it would consider buying rivals' closed stores.

"If store-fronts close, a big number, you can bet that we will jump in and connect with those customers ... and take advantage," said Brian Dunn, Best Buy's chief operating officer.

Circuit City has faced particularly tough competition from Best Buy, which has increased its market share.

In September, Circuit City's chairman and chief executive Philip Schoonover stepped down.

At the time the firm said it would embark on a turnaround plan to improve its outlook.