due to coVID-19, a wave of bankruptcies has swept through industries
One day in April, Pier 1 stopped production of its star product, the flying saucer chair.
In fact, Pier 1, One of America's best-known furniture retailers, stopped doing all its business. Chief Executive Robert Riesbeck told reporters: "We don't want to interrupt our suppliers to make things we don't need." Flying saucer chairs and other items are still available in stores, and the leadership plans to clear inventory by the fall. And then it's all over.
Pier 1 has been popping up all over the mall for decades, but now it's over.
The epidemic has worsened the economy in the United States, with many household names in various industries declaring bankruptcy and many more teetering on the brink of bankruptcy. Some predict that we are at the beginning of a wave of bankruptcies.
Such a bankruptcy is sad. There's been a wave of nostalgia on social networking sites recently, with people mourning the recent bankruptcies of familiar brands. but in fact, the bankruptcy of the company not only mean the disappearance of a brand. When we hear that pizza Hut's largest franchisee has declared bankruptcy, let's not assume that the pizza Hut stores will disappear tomorrow morning.
Technically, a bankruptcy filing is a financial instrument that allows a business to be taken over and restructured to get out of trouble. Filing for bankruptcy gives a company a chance to restructure its debt, cut costs, restructure an industry and so on, and move on after being acquired.
Is Pier 1's competitor e-commerce or a virus?
Although Pier 1 is a classic brand in the minds of many, business is business, good and bad, and bankruptcy is the decision to minimize losses and maximize asset protection.
Sometimes, restructuring isn't a good idea either, because in extreme circumstances (such as a moment of economic uncertainty), no one may want to take a bankrupt company and risk its finances to tide it over. In such a case, only the assets owned by the company, including inventory, property rights, e-commerce operations and office furniture, can be sold, i.e. a complete liquidation.
Pier 1 was vulnerable to mismanagement even before the pandemic began. On February 17th it filed for bankruptcy, blaming the rise of the Internet and e-commerce. According to an official report at the time, Pier 1 concluded that its bankruptcy had little to do with the outbreak, mentioning only that warehouses in Asia might have been affected by the outbreak.
Arguably, Pier 1 had a survival plan in February: It closed nearly half of its stores and consolidated offline distribution centers. The practice, which left many employees unemployed, was seen as a desperate attempt to save the company.
From the management's point of view, the survival plan worked. "We believe there will be a turnaround in our business because we're on the right track and delivering good results," CEO Risbeck said. We firmly believe that Pier 1 still has a place in the world."
Pier 1, however, did not take the turn it had hoped for, and did not wait for the opportunity to restructure the company.
About a month later, when the coVID-19 outbreak began in the United States, all "unnecessary" stores across the country had to close, and Pier 1 closed all its stores.
By May 29th the company had no choice but to announce that it would no longer apply to restructure the company, opting instead to shut it down altogether. The company's intellectual property auction is expected to conclude this month, and the process of liquidating existing goods and closing stores will conclude this autumn.
Pier 1 is a classic furniture brand in the Hearts of Americans, and the story of its demise is sad. Perhaps the most poignant aspect of this story is that there is no opportunity, no strong business leader, to rewrite the fortunes of a company in the context of an epidemic. Learning from Pier 1's demise can serve as a wake-up call for other companies, large and small, to learn lessons and discover new opportunities.
Thousands of stores once dotted the United States
Pier 1 was founded in 1962. In the past half century, it has grown from a small store in California to a well-known home furnishing retail giant in America.
Pier 1's style caters to the young baby boomers who lived there after World War II. These young hippies loved beads, incense, candlesticks, and rattan furniture, and Pier 1's furniture provided just that. Pier 1 imports some of its goods from places such as South-east Asia, and its low costs keep it affordable. The California store was spotted by Tandy Corp, bought by Luther Henderson, and expanded to become one of the nation's top furniture retailers.
By the 1960s, Pier 1's new stores were popping up all over the United States, particularly popular with adventurous and unconventional young people. Walking into the store is like walking into an old grocery store, with quaint furnishings everywhere.
This style lasted for many years. Pier 1 hr director Christine Murray (Christine Murray), according to former employees pull down household from the truck will be carefully designed its placement: "on the corner basket hanging on the ceiling, carpet, give a person a kind of treasure of stimulation", "here, customers can roaming, touched objects, looking for the right goods."
In 1970, the company went public. The next two decades were ups and downs, but by and large they continued to expand. By 1985, Pier 1 had 265 stores and was the backbone of the retail home furnishing industry. But that "treasure hunt" style was replaced by a simple, formulaic one. Even though the furniture itself has a strong style, the shop assistants no longer decorate the shops as before.
In the wake of the September 11th terrorist attacks, Pier 1's franchise has gained momentum. "Pier 1 is very much in tune with people's needs, they need a piece of furniture with a touch of individuality and nostalgia." At Pier 1's peak, it was still importing some of its furniture from overseas. "Some customers will find the same products in overseas markets, but that's ok, because here in the United States, we're still offering a niche product, and customers don't have to worry about duplicating other people's furniture."
But twenty years later, Pier 1 no longer feels that way.