The Lesson of Toys R Us, Blockbuster, et. al.
Our local Sears closed its doors this month, as are so many around the country. Speculation is that the corporation may not make it to the end of the year. That got me thinking.
I spent most of my adult life in government service, as an Army officer. I was in the nonprofit sector for 5 years. Between those two adventures, I spent more than a decade in the private sector. My time in the corporate world gave me an education for which I am most grateful.
One of the first lessons learned in the private sector is that success is an ephemeral thing. “What have you done for me lately?” is the unspoken question on the lips of every consumer. Businesses ignore those whispers at their own peril.
Let’s look at a short list.
For many years, when we wanted to reproduce a document, the phrase most often spoken was “go make a Xerox, please.” Xerox invited the commercial copier. For years it almost completely owned the market. Now? They are one of many players in the field, and a pretty small one at that.
Circuit City was once ubiquitous. They were the original big box electronics store. They were everywhere – I even shopped at them in Europe. Now? Gone, replaced by Best Buy. Speaking of which…. Best Buy is on shaky legs, hunted to near extinction by Amazon.
Toys R Us was an American icon, especially around the Christmas Holiday season. Now? Gone, also gutted by the online market and other factors.
Macy’s? Looking weak. K Mart? A shell of its self, about to die off. 66 Lumber pretty much invented the idea of the big box hardware store in one form. Now they are rare. Hechinger’s was the original full range big box home repair store, but they lost out to Home Depot and Lowe’s.
Like informal dining out? Friendly’s, Fuddruckers, Sbarro have all declared bankruptcy. The parent company of Applebee’s and IHOP is looking at risk as well.
Barnes & Noble has been on the ropes for a long time now and may be about to bow out. Remember Blockbuster, Borders Books, Hummer, The Sharper Image, and Polaroid? All gone. OK, there is ONE Blockbuster store still left. One.
Can you remember how many airlines folded or consolidated in the last 20 years? You are keeping score better than I. Blackberry keeps the wolf at the door, but I would not make a long-term bet. Same for Twitter.
Car Companies. Note the passing of Oldsmobile, Pontiac, Studebaker,Plymouth, American Motors, and many others . All were once giants in their industry. Rust in Peace.
And so on. The point here is that in the private sector, there is no rest. The risk is ever present that someone will figure out how to do what you do, only better. Or that a whole new market structure will pop up and make what you offer obsolete. Being the best buggy whip maker in America will not be enough.
So, hats off to those that stay in business, make a profit to reinvest, act as members of their community, and take care of their workers. For those of us not in the private sector, take a moment to reflect on what a battlefield that is. I salute those who pull it off. This isn’t easy, folks. Those who do it well, year after year, are doing something special. We all benefit from their success.
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