Stores Going Out Of Business
Many stores are 'Going Out Of Business'
Office Depot, T-Mobile, Blockbuster, Macys, Zales. We've all heard the rumours in 2010. In 2008 we heard about The Sharper Image and Linens N Things. Next came word that Circuit City would be closing its doors. Smaller retailers also announced closures. KBToys added its name to the list in a shocking move for a toy store: it announced upcoming store closures before the Christmas shopping season of 2008. Rumors spread about Home Depot being the next one to go under. Where was the axe going to fall next?
And after that axe falls, which companies will re-emerge? The Sharper Image is back as a brand name. Circuit City is back in business. Linens 'N Things was back quicker than they went.
Blockbuster, after a long time struggling with competitor in a new format of movie rentals such as Netflix and Redbox, filed for Chapter 11 Bankruptcy protection on September 23, 2010.
Blockbuster, based in Dallas, earlier this year said it would close hundreds of stores and said it was struggling with liquidity problems. It had warned investors it might file for bankruptcy protection and was delisted in early July by the New York Stock Exchange.
Movie Gallery Inc., the parent company of Hollywood Video, filed for bankruptcy protection in February 2010 and liquidated several months later in August. Although Blockbuster has made key changes such as eliminating late fees and providing online and kiosk rental services, however these changes weren't enough to turn the company around. Video rentals are not the only victims to new technology: traditional book sellers as well as record & cd stores have fallen prey to mega-companies iTunes and Amazon.com
Blockbuster said Thursday it plans to keep its 3,000 U.S. stores open while it evaluates them. Digital and mail businesses will all continue to operate normally. Operations outside the U.S. and domestic and international franchisees are not part of the Chapter 11 reorganization. Blockbuster's U.S. DVD vending kiosks, owned and operated by NCR Corp., are also not part of the reorganization and will continue to operate normally.
In short, Blockbuster is continuing to operate. They're not gone yet.
How's this for enterprising? The name of this store was 'Going Out Of Business', until the Texas Attorney General decided that the name was deceptive. Read all about it at the Walletpop blog. Other potentially deceptive marketing ploys:
- The Japanese town named 'Usa' selling products labeled "Made in Usa".
- Tshirts manufactured by a company called "Made in the USA".
Who's Going Out Of Business?
10 Brands That May Disappear In 2011
Information provided by 24 / 7 Wall Street
On July 8, 2010, Yahoo Finance listed 10 Brands That May Disappear in 2011. The 10 troubling companies and the tell-tale signs of problems ahead are listed below.
- After declaring Chapter 11 bankruptcy in August, 2009, Readers Digest cut its readership guarantee from 8 million readers to 5.5 million and cut the number of printed editions yearly from 12 to 10.
- Blockbuster - While Blockbuster itself may survive in a different, on demand or mail-in / kiosk format, its brick-and-mortar stores are dead in the water. It is now contemplating Chapter 11 bankruptcy to reorganize its debt.
- Dollar Thrifty Automotive Group - With over $1.5 billion USD in 'debt and other obligations', Dollar Thrifty Automotive Group is for sale. Potential buyers include both Avis and Hertz.
- T-Mobile - Offering no 4G network and coming in last place amongst America's four top wireless networks. T-Mobile "has no future in the US." Talks of a merger with Sprint / Nextel have been mentioned.
- Moody's Corp. - Moody's has tarnished its name beyond repair with mortgage-backed securities and rumors of a compromised rating system to get business. It has 4 civil actions pending, charges brought against it by the US government, and possible actions pending from overseas authorities. It is also certain to be regulated, a move which will surely hurt its sales.
- BP - BP will most likely separate its businesses and operations in a restructuring move geared to salvaging the brand.
- Radio Shack - RadioShack may be taken over by BestBuy, who would ditch the less-favorable RadioShack brand name.
- Zale Corp. - Zales recently made Forbes list of 'firms with extreme financial risk.' It is being squeezed out of the market by superstores like Wal-Mart.
- Merrill Lynch - Merrill Lynch has been acquired by Bank of America, but that almost certainly means it won't be long before Merrill Lynch becomes Bank of America Investment Management.
- Kia Motors Corp. - Kia is owned by the same parent company of the much more successful Hyundai brand. The usual happening for companies where one line is more successful than the other is to dump the less-productive line and focus on the successful sibling. This will be the case for Kia, being no match against Hyundai.
Yahoo Finance's Businesses on the Brink
with info provided by Investopedia
On April 1, 2010, Yahoo finance listed 5 companies struggling to stay in business and this was no April Fools Day Prank. Yahoo's picks and the reasons for trouble are listed below
- Blockbuster.com This former movie rental king has a debt of $963 million and shares trading at under $0.30 each. Major competition includes Netflix and Redbox kiosks.
- Rite Aid has $6 billion debt and $150 million cash. Operating at a loss, its competitors are Walgreens, CVS and Wal-Mart.
- Borders - is developing a Kobo e-reader to compete with the likes of Barnes & Noble's, Apple's and Amazon's technologies. Borders shares are going for under $2 a share currently and they have a few big loans of $42.5 million and $360 million, both due within the space of a few months.
- Palm reported a net loss of $102 million last quarter. Palm shares have dropped 77% over the past 6 months in the midst of competition from other smart phone makers Google, Apple and Research in Motion.
- YRC Worldwide has shares trading below $0.50 a piece and narrowly avoided a bankruptcy last December with a $470 million debt-for-equity swap. This trucking company hasn't posted a profit since 2006.
Check Your Gift Cards
When a store declares bankruptcy, there's a good chance it will stop honoring gift cards. Check your wallet and redeem any gift cards you're holding when you even start to get news of an upcoming business closure!
Top 10 Stores Predicted to go bust - September 2009
Taken from the front page of Yahoo.com
Logging on to yahoo.com I was intrigued to see their article on Ten Big Companies That Are Veering Towards Bankruptcy. Who are the predictions?
Their information was taken from The Business Insider (September 18, 2009) and is based upon market cap to enterprise value ratios.
Recently Announced Closures
Air America Radio - announced 1/21/10
Japan Airlines - announced 2/20/10
Movado - announced 5/28/10
Movie Gallery / Hollywood Video / Game Crazy - announced 4/30/10
Bernard Callebaut Chocolates - announced 8/3/10
Companies In Trouble
- Barnes And Noble
- Las Vegas Sands
They went bust, liquidated, and now they're back..
- Circuit City
- Linens 'N Things
- The Sharper Image
Going Out Of Business Ads From Years Past - Linens 'N Things, Mervyns, Gottschalks, Circuit City
What Brings You Here? - Lots of people could be interested in why a company fails.
Maybe you're looking for liquidation sales, on the trail for hot bargains. Or - you heard a rumor about a favorite store of yours, a business competitor, a place that ripped you off previously and you'd love to see hit the wall: your motive is curiosity. You might be an investor, either a lender or a shareholder and are looking for keys to a company's (or the consumer or supplier of another company's inventory) financial well-being. I'd be interested to see what brought you to this page.
What information were you looking for at this Squidoo lens?
Coverage on individual stores rumored to be going out of business.
Barnes and Noble Going Out Of Business?
No - its just a corporate ownership change for the bookstore giant.
In their August 4, 2010 article, Barnes and Noble May Put Itself Up For Sale, MSNBC reports that the ownership or at least corporate governance of the world's largest bookseller is going to be shaken up soon. Billionaire Ron Burkle (owning 18% of the company's stock) has been battling with Leonard Riggio (the company's founder and largest shareholder with approximately 30% ownership of shares) over which direction the company will take.
Burkle has aligned himself with Alethia Research and Management Investment Group (which holds a 16% interest in Barnes and Noble shares). Burkle is not interested in a takeover, but is expected to propose 3 new board members at the next directors' meeting (to be held before September 30). Riggio is considering joining an invester group to buy the flailing bookseller.
Barnes and Noble share prices have been falling steeply since late June when the company released statements showing fourth quarter losses and low income expectations. Much of this trouble can be attributed to research costs tied to the digital market. Should Barnes & Noble fans or owners of the Nook digital reader be worried? NO.
Your thoughts and predictions.
Books on Amazon Related To Business Closures - From a variety of points of view
I've found a few books at Amazon.com that relate to business failures, from all perspectives. There's a legal text on Chapter 11 bankruptcy law, a book of investment tips regarding troubled companies, tips on how to send a company to the wall, a business success how-to manual detailing the biggest mistakes companies can make for their financial well-being and, lastly, a book documenting the retail downfall in 2008.
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Why did you stop by to read this lens? I'd love to know what angle you're looking at this information from. Were you enlightened about anything? Relieved to hear that your favorite store is not going out of business? Saddened to see that the rumors were true? Surprised by news of a company closure that you never expected? Leave a comment here!
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