I'd like to discuss a news story that particularly annoys me. The story proclaims that Blockbuster is to close as many as 960 of its stores in the US as a means of streamlining their operations. That's up to 960 stores worth of employees that are going to be unemployed.
The reason that I am so irate is that the biggest reason for the closures is bad business management. The board of Blockbuster can't just blame their failures on the lousy economy. Sure they've been hit, but what happened to escapist industries supposedly thriving during a recession. Instead Blockbuster is limping along. The real reason for their poor performance is that they have clung to a traditional business model for too long and only attempted to jump on the bandwagon of new ideas when they had already passed them by.
The reason that I am so irate is that the biggest reason for the closures is bad business management. The board of Blockbuster can't just blame their failures on the lousy economy. Sure they've been hit, but what happened to escapist industries supposedly thriving during a recession. Instead Blockbuster is limping along. The real reason for their poor performance is that they have clung to a traditional business model for too long and only attempted to jump on the bandwagon of new ideas when they had already passed them by.
I am of course talking the rise of internet television, and mail-DVD renting services, i.e. Netflix, DVD vending machines, e.g. Redbox and on Demand cable television services. Numerous other companies providing services that Blockbuster should have been in a prime position to come up with years in advance. How did Blockbuster miss all of these opportunities? Why aren't they coming up with something new/better, not just carbon copying the aformentioned other companies' ideas?
Source
Blockbuster to close up to 960 stores
(LINK)
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Have got to love being the lawyers, though ...
ReplyDeleteYour source talks Blockbuster consolidating physical locations to focus resources, and earlier this year hired Kirkland Ellis re: raising capital (though it was rumored to be a discussion bankruptcy filing). Interesting: Kirkland received a lot of attention (not altogether negative) for charging $ 18.50 a minute for similar bankruptcy services in January of this year. $ 18.50 a minute??! See http://www.bloomberg.com/apps/news?pid=20601109&refer=home&sid=agfjWe9ZN25Y
"Your Honor, my client has no money because ... "
I LOVE love the law!
In any event: maybe closing this many chains will force the company to be more innovative?
See you, Rory! Have a good week, Sls.
Ha ha, it's true, the law can be hilarious at times.
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