Build-A-Bear Workshop
Ah, Build-A-Bear. The mall shop was established for no other reason than to ensnare unwitting parents, who are just minding their business trying to get some shopping done, into paying an absurd amount of cash for a stuffed animal. Imagine the disappointment when build-a-bear’s fourth-quarter earnings took a dump.
CEO Sharon Price John said the company will have to close 30 stores. The plush bear brand was brought into Walmart locations because Walmart-shopping parents can surely afford to toss a percentage of their hard-earned paychecks into a completely useless product. And it’s not just Walmart. FAO Schwarz in NYC even allowed the brand within its doors.
Office Depot
The Retail Apocalypse stretched back to 2017, but Office Depot’s financial woes stretched back even further. Competition to sell bulk office supplies has been fierce due to competitors like Costco and Staples and because of the technological shift, which has lowered the demand for paper-based office products. It got so bad that Office Depot hoped Staples would buy them out in 2015. The acquisition didn’t pass antitrust muster, and Office Depot looked elsewhere for help.
So, finally, by 2016, despite the Staples acquisition falling through, Office Depot began to pull a profit. This occurred ever since a 2013 merge with OfficeMax and other reshuffling was put into place. For instance, Office Depot closed 400 stores in 2016 and has moved toward service-based products like their new BizBox platform available since the new CompuCom acquisition.
BKH Acquisition Corp.
BKH Acquisition Corp. owns and operates over 100 Burger King fast food diners in Puerto Rico. A BKH Subsidiary, Puerto Rico-based Caribbean Restaurants, is responsible for the day-to-day operations. In 2017, BKH Acquisition Corp. found its financial rating lowered due to lower poor sales and challenging economic conditions in Puerto Rico.
Their malaise was brought on, in part, by Hurricane Maria. BKH seems to be recovering somewhat. Its financial rating was brought up to a CCC+ from a CCC- in the middle of 2018. The rating change was a result of Acquisition Corp. closing on a new term loan for debt. With a lower risk for default, the company’s negative risk factors were thereby lowered.
Abercrombie & Fitch
In its heyday, Abercrombie & Fitch epitomized the brand appeal the under-30 crowd longed to don. Since then, A&F seems to have met its descent toward “just okay.” In all, 475 A&F stores have shut their doors in the past eight years. The closures include Hollister, a brand A&F owns. The massive downsizing of stores and square footage extends to a new growth model. After closing 40 standard stores, 40 new, smaller, “more intimate” stores and kiosks opened.
The store closure announcement followed a disappointing sales growth and future sales outlook report. The company owns 850 stores throughout North America, Europe, Asia, and the Middle East. Of those, the Hollister four-story mega-store in New York’s SoHo neighborhood is being closed. It’s not the only flagship store scheduled for closure. The Hong Kong store is slated to be gone, as well as the large A&F flagship stores in Milan, Fukuoka, Japan, and Copenhagen. According to Forbes, CFO Scott Lipsky said that the remaining 15 flagship stores burden financial results. Bigger is not always better now that e-tail is in ascendance.
Foot Locker
Foot Locker, another victim of the ongoing ghost-town effect on malls, closed 110 stores in 2018. The Manhattan-based company reported a $49 million net loss that year and scrambled to stop the bleeding by slashing stores.
In sharp contrast to 2018, Foot Locker beat its earnings goals by double in 2019. Billed as a miraculous turnaround, the company saw a 2% rise over 2018, defying the onslaught of the mall-based Retail Apocalypse. The company, founded in 1974 by Woolworth and Kinney Shoes, operates in 28 nations around the world with over 3,000 locations. Its first store opened in California at the Puente Hills Mall. It’s still open today.