Posted on 05/02/2016 8:49:41 PM PDT by Hojczyk
Outdoor apparel giant Sports Authority has filed for Chapter 11 bankruptcy protection and the retail chain could close all or most of its 450 stores nationwide as it struggles to pay off a reported $1 billion debt.
Sports Authority is “pursuing a sale of some or all of the business,” a company statement said. “We have received initial expressions of interest from a number of potential buyers, and we are optimistic about the results of the sale process.”
Founded in 1928, the athletic apparel retailer was once the largest sporting goods chain in America.
In the years after its 2006 leveraged buyout by Leonard Green & Partners, Sports Authority saw a slump in sales due to competition from mega retailer Dick’s and online merchants.
In its initial bankruptcy filing last month, Sports Authority was hoping only to close 140 stores while keeping its remaining stores open under its well-known trademark name. Closing all of its 450 stores could leave 14,500 people without jobs.
And Sports Authority may soon join the ranks of a growing number of now-shuttered brick-and-mortar retail giants. Circuit City’s 2008 bankruptcy and complete implosion was followed by Blockbuster in 2010 and Borders in 2011.
Alternatively, some big brands like K-Mart (filed Chapter 11 bankruptcy in 2002) and Radio Shack (filed Chapter 11 bankruptcy last year) have found some economic success by dumping debt through bankruptcy.
(Excerpt) Read more at breitbart.com ...
Survived the Great Depression, but couldn't survive the Obama Administration.
The Sports Authority near me in Lakewood,CA used to be a Circuit City. It’s a shame, as the store is super nice, well-stocked and clean. That location seems to have bad luck.
I remember their recent commercials.
I’m not surprised given the horrendous foot-traffic in this crashing economy. There will be a lot more to follow like this.
What fools still believe Obama and the unemployment figures?
Wait, don’t answer that.
the Cruz campaign should open an office in that building.
Several mentions of Amazon and online retailing, but none of the fact that Sports Authoity dropped their firearms department several years ago. Meanwhile Academy Sports has a large firearms department and seems to be doing OK.
I think both things are important factors.
Haha Wasn’t expecting that line, so I really enjoyed the laugh.
That has to be the most self centered approach to this issue I've ever seen. Really? You think you helped alleviate a housing shortage? The psychology of your post is frightening.
Slightly OT, but that reminds me of something humorous that happened to me way back when.
I bought a new Browning 12 ga. A-5 at Sports Authority back in the mid '90s. Their policy was that a store employee had to walk boxed firearms to the exterior door prior to handing them over to the purchaser.
The person who was doing the task was, shall we say, a bit tomboyish. No, a LOT tomboyish, if you get my drift. Anyway, I had my young old son with me and right at the crowded cash registers he piped up in that piercing 4 year old voice - "Dad! Why does that man have your gun?"
LOL.
Harking back to Art Linkletter from my childhood, Kids Say the Darndest Things! Heh!
There was one near my house that closed a number of years ago. But within a quarter of a mile if it, there was also a Dicks Sporting Goods and a Dunhams.........I don’t know how they compete.
The one in Mission Viejo also. Apparently they’re all gone.
http://www.ocregister.com/articles/chalet-712378-stores-sports.html
Your comment made me wonder about all the mattress store chains, too. Do that many people buy mattresses? When I pass by the parking lots are always practically empty.
“No wonder physical stores are shutting down left and right”
One of the issues at hand is the cost of commercial rents, local taxes, and local regulation.
If you are starting out with a unique retail idea/store, it is likely to cost you several thousand a month just for rent. Then there is licensing, utilities. Then there are employees. Then there is an overall litigious environment - such as the inevitable “lawsuit sting” by an LGBT-er looking to be offended by something.
Amazon offers a way for a person to go into business way before they would be able to open a brick-and-mortar store, avoiding all of those costs.
A modest storefront might have to generate $5k-$10k in margin - requiring maybe $30k in sales every month to pay all these bills and allow a modest income for the proprietor.
I think small business storefronts, with the owner living on the premises will be the new/old model for brick-and-mortar retail.
One thing is for sure - commercial real estate values and rent, and tax expectations must reset or brick-and-mortar will never come back.
Unfair Red Chinese trade also took the discretionary incomes of Sports Authority’s American customers; our retailers are now focusing on how to sell to billions in Asia (who now have the jobs and incomes to shop).
I'll bet that the Chinese do not pay the least of their employees $15/hour!
Unfair Chinese trade did it!
Actually, over leveraging through buyouts caused it. The investment bankers sold the notion that a sales increase plus efficiencies gained would pay for the buyout. In many cases it just did not work.
I recently went to my local Snapper dealer to get a new mulching blade for my Snapper mower...they wanted $75 for it...for a lawnmower blade!
I found the same one, on line, for $29. Still too much, IMHO, for a lawnmower blade, but at least it was affordable.
I patronize small biz/independents as much as possible - Costco for bulk purchases (pet food mostly).
Survived the Great Depression, but couldn't survive the Obama Administration.
The American nation may not survive the Obama administration..........
Me: "Do you guys carry ammuntion?"
SA: "WHY NO! This is a sporting good store!"
Me: "Bye." (and I never looked back....10 years ago).
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