Bankruptcy due to Poor Management - Case Study Example

Strategic Management Sears Holdings Even though Sears is one of America’s oldest retail companies, it struggles with the problem of demographics. Most of the company’s customers are elderly. It has, for a long time, failed to attract younger customers. There has also been a shift in the retail landscape with more and more customers preferring to shop online due to their busy schedules. Sears has failed to adapt to the new reality. The company also lacks innovation as it has failed to diversify its products base. K mart Holdings purchased Sears in 2004 to form Sears Holdings Corporation. After the merger, the corporation continued to operate stores under the two brand names. The merger helped the two corporations to significantly cut costs and operate more efficiently. Since 2005, there have been a few changes in the operations of the firm. For instance, during the last quarter of 2005, the corporation introduced another store format known as Sears Essentials. In 2010, the company launched an auto franchise program. At present, Sears struggles with paying its debts. This is because the company has been continually making losses due to its inability to reinvent and strategize. The inventory in most of their stores is depleted and many suppliers are not willing to supply the company with the needed merchandise. The ones who do are demanding earlier payments while some are refusing to supply bigger orders. Customers have started taking note of their struggles and are shifting to other retailers. In 2017, Sears Holdings (SHLD) was ranked 172 in the Fortune 500 companies list. Sears Holdings has greatly been impacted by consumer trends. Most consumers nowadays are preferring to shop online instead of physically visiting the stores. The company has failed to capitalize on the new trend which has greatly affected its overall sales. The company needs to change its management especially the CEO who has continually failed to acknowledge his shortcomings. There also needs to be a change in the company’s marketing and operations. For instance, the company should try partnering with giants such as Amazon to boost sales. The National Football League (NFL) The biggest issue impacting the National Football League is the national anthem problem. More and more players are joining Colin Kaepernick in taking the knee during the national anthem. The players who refuse to acknowledge the flag are protesting the systematic oppression of minorities in the United States. Kaepernick first took the knee in 2016 and the issue has continued to raise concern up to date. The NFL has difficulties resolving the issue due to the delicate relationship between the players and owners of the clubs. The NFL was established in 1920. It was previously called the American Professional Football Association (APFA) and had a total of ten teams. The teams were drawn from four states. The league underwent several changes which shaped its future. For instance, in 1927, admittance of African American players into the league was halted. However, after the Second World War, the ban of black players was lifted and they were allowed to rejoin the league. One of the problems facing the league is the issue of player safety. The league is focused on making the game safe for players while the players want to gain an edge in speed. Some of the players are abandoning their pads in order to be fast which also puts them at risk of injury. There have also been concerns raised about the league’s scheduling process. Both the players and fans are not happy with the preseason games. They both want the games to be shortened. They argue that the long preseason games do not necessarily lead to improvement in performance and therefore the concept needs to evolve. Since 2016, NFL ratings and viewership have dropped considerably. It has been reported that fans who used to be serious viewers have taken a more casual approach and the few who still stream the games do not watch them to the end. The dropped ratings negatively affect the revenues received by the organization as advertisers pay good money for huge ratings. One way of dealing with the reduced numbers is to lower the number of Thursday Night Football games. The Increased number of games have created a burn out among fans. The protests being experienced should not be aired but should simply be reported. Many fans are opposed to the politicizing of the games. Toys-R-Us. Toys "R" Us was forced to file for bankruptcy after it reported continued losses. The losing streak began in 2013 and forced the company to apply for chapter 11 bankruptcy in September 2017. The US Bankruptcy court required the company to liquidate all of its 735 US stores before it could be declared bankrupt. The company’s management responded by liquidating the inventory in all of its stores and selling them off. Toys R Us was impacted by several issues that led to its closure. However, fierce competition from players such as Walmart, Amazon and Target greatly affected the company. The competitors offered irresistible discounts and were able to attract customers hence affecting the company’s profits. Additionally, some of the company’s vendors began withholding supplies which further affected the company’s income. Toys R Us was founded in 1948 by Charles Lazarus. It was initially a children store based in Washington DC. During its first few years, it dealt in children furniture before incorporating toys for children of different ages. In 1966, the Interstate Department Stores acquired it. During its closure, the company faced a huge liquidation problem due to its 735 US locations. The main problem which affected the company during its operational days was its inability to adapt to the changes in the consumers choices and preferences. Many of the toys which were available in the company’s inventory were not very popular among kids which greatly affected sales. Changes in consumer trends have also negatively impacted the company. More kids are preferring smarter toys since they provide greater interactive play. The preference affected the demand for toys sold by Toys R Us since the store did not stock such toys. There are a few ways through which Toys R Us can revive its operations. The company needs to invest in innovation and market research in order to understand market demands. The company should also embrace the online model of doing business as it has become very popular in recent times. Mall of America Even as other mall-based businesses continue to close down, the Mall of America continues to prosper. According to the Minneapolis Business Journal, the MOA is a highly valued asset. Internet retailing has negatively impacted many brick and mortar business. Such businesses fail to survive because they are limited in what they offer. The MOA has been positively impacted by its business model and mode of operation. It does not only offer retail services but also entertainment services. Its ability to provide value in different ways has enabled it to withstand the changes which were witnessed in the retail industry. Many of the people who frequent the mall see it a central part of the community. It has also been positively impacted by its direct flight deal with Delta. It enjoys many visitors from Iceland and local tourists. The idea and concept of the mall was developed by the Triple Five Group. The group had experience with other malls as they had founded other huge malls in the country. The mall officially began operation in August 1992. In 2012, expansion plans for the mall were launched. In recent times, there have been plans to construct an indoor waterpark. Due to its large size, maintaining security at the MOA is not easy and has often created problems. The mall’s management has a duty to protect the visitors which is not easy. In the past, there have been threats of attacks from extremist groups which has forced the management to tighten the security. The MOA holds a favorable standing in America’s retail and entertainment industry. It is among the top-five largest malls in the United States. Some of the consumer trends which have impacted the mall’s operations and profitability include internet shopping. However, the mall offers a diverse range of goods and services which has helped it to cement its place in the retail and entertainment industry. In order to maintain its profitability, the mall’s management should continue to invest in innovation and market research. Ports of Los Angeles and Long Beach The port of Los Angeles and the port of Miami make up the San Pedro bay Port Complex. The two ports combined can handle more containers than any other port complex in the world. In 2017, the cargo value handled by the Port of Los Angeles rose to $284 billion from $272 billion. In recent times, the two ports have reported an increase in the volumes of cargo handled. The increase has especially been larger for the port of Los Angeles compared with the port of Long Beach. The two ports continue to focus on improving both their inbound and outbound traffic. The main issue impacting the port complex is the waiting time. A section of customers are dissatisfied with the long wait times and have had to consider other options. The port of Los Angeles was officially founded in December 1907 after the city’s leaders and management took note of the opportunities the port had created. The port of Long Beach, on the other hand, was founded in 1911. The main problem experienced at the two ports is congestion which causes long wait times. The San Pedro bay port complex is the fifth busiest port complex in the world. It is the largest port complex in America. Port activities have been negatively impacted by the emergence of online shopping companies such as Amazon. Customers of such companies demand the delivery of goods within short periods of time which has forced some manufacturers to look for faster means of delivering goods to customers who order through such companies. The port complex should invest in newer technology to ease the congestion problem being experienced. Read More