At a recent gathering of marketing executives for consumer electronics manufacturers, the Nationwide Marketing Group’s PrimeTime! meeting, one of the big topics of conversation was Circuit City Stores. Based on comments reported by This Week in Consumer Electronics (TWICE), the ailing consumer electronics retailer can count on moral support, if not more, from its major suppliers.

Although Circuit City faces immense competitive pressure from Best Buy, Wal-Mart and other retailers, it still commands enough market share that the big TV manufacturers would like to see it hang tough.

"It is a lot better for the industry if we have a strong Circuit City,” said Scott Ramirez, Toshiba marketing VP for TV. “We need a variety of retailers. Circuit City, other national chains and independent retailers give the industry and consumers a variety of options."

Steve McNally, consumer electronics sales VP, LG Electronics, said, "We are light on retail competition right now. … We need Circuit City more than ever."

Circuit City "makes our business competitive," said Max Wasinger, sales and marketing senior VP for Mitsubishi. His company "values our relationship" with the chain, he told TWICE. "We want [Circuit] to survive and thrive. We don’t want [the industry] to rely only on a couple of national accounts. We also need local and regional retailers too."

Bacon’s bottom line: Circuit City’s challenge is to nurse its cash and stretch out its credit as it executes its turnaround plan. Support from the big suppliers is crucial for the money-losing company as it approaches the peak selling season this Christmas holiday. Sympathetic and cooperative suppliers – especially manufacturers of the big-ticket, high-margin items like big screen, HDTVs -- can buy the company more time by granting easier repayment terms. On the other hand, they risk getting stuck with a fistful of bad bills if Circuit City is forced to file for bankruptcy. Their support is crucial.