Sports Authority Chapter 11 bankruptcy
protection in the midst of troubled waters, as the troubled retailer of sporting
goods, and its creditors two options are explored:
• unwieldy, $ 1.1 billion of outstanding debt
and give a buzzcut; Slim down operations; And the emergence of lean and
competitive.
• sell all or part of the business.
"We're charging down the path,"
Sports Authority CEO Michael Foss said in an exclusive interview with the
Denver Post. "We do not know what path we'll end up going back home, but
we are determined to make sure that we all broadly looked at what would have
been the best for all four seats" - financial stakeholders, employees,
customers and vendors.
In both cases, the option will reach its
conclusion at the end of April, Foss said. As much as $ 595 million in
bankruptcy financing that the company and the lender is the way you want it.
"I think all this will come to fruition
over the next month or two months," Foss said.
Failure to empty big box stores like Borders
and Circuit City, Amazon could leave a trail.
Sports Authority was expected Chapter 11
petition. In recent months the company to avoid paying the debt, executed a
round of corporate layoffs, plans to shutter stores andwarehouses draft, and
engaged in discussions with its creditors.
Filings, the United States Bankruptcy Court in
Delaware on Wednesday indicated that the Sports Authority $ 500 million to $ 1
billion of the assets of the debtor-in-possession financing is secure and that
the company launched a restructuring of the company.
Sports Authority of Denver and Chicago, as
well as distribution centers and warehouses in the United States and Puerto
Rico is full of plans to close or sell 464 stores to 140. Denver Castle in the
venerable sports, such as Virginia Beach, VA., And Kansas City, Mo at all 25
stores and locations in Texas, in the list, Foss said.
About 3,400 of its 15,000 employees the
company hopes to go, Foss said. Most of the corporate headquarters tally of
those who were laid off in January, 100 people there. Feb. 10 is notified of
the workers affected stores and distribution centers.
Under the bankruptcy option No. 1, Sports
Authority of e-commerce, private label sales and a greater focus on customer
service with a 320-store operation will emerge as, Foss said.
But the dramatic enough to change behavior may
not modify, John Schallert, Longmont is a business and a retail analyst with
the Schallert Group Inc. said. Consumers "breadth and depth" and
generalists as opposed to seeking specialization, he said.
"If (Sports Authority) really proactive,
they are smaller, more specialized formats will start looking at," he
said. "The problem with big companies like this to the extent that they
should be telling consumers that they do not want to reinvent it."
Cost savings for the reduction of the impeller
is one thing, but if not, Sports Authority plans to change the way it interacts
with customers on a executes, Schallert said it would run the risk of failure
as a Service Merchandise, Montgomery Ward, Circuit City, and has blockbuster.
"Historically, retail trends, with 90
percent of the time like this is a step usually is not enough," he said.
Sports Authority position shutter 140 or more,
then the effects would ripple through retail employment and commercial real
estate market, he said.
"And those are the days that come readily
for large-format stores are going to take a lot of retailers do not have,"
he said.
Leaving some areas more than others will feel,
Ryan Severino, senior economist and Reis Inc., a New York-based research
director for commercial real estate research firm.
Power plant - a large outdoor shopping center
with three or more anchor - more easily than a low-caliber mall vacancy can
absorb a Sports Authority, he said. Areas such as Texas, with the economic
growth occurring in pockets, Midwest, which is already economically depressed
position can be protected from the negative effects, he said.
"I do not think you have a large,
systematic effect" from the closure of 140 stores, he said. "It will
be the center and certain submarkets."
Sports Authority, which was taken private by
Leonard Green and Partners LP in 2006, Statista, according to the 12-month
period that ended in October, revenue was $ 2.6 billion. In 2014, the company
had 470 stores and $ 3.4 billion in revenues drawn.
But Foss said the company in an
"inefficient store network" that the five major retailers, sporting
goods has been dogged by integrating the results.
Sports Authority stores hodgepodge, with sizes
ranging from 8000 square feet to 80,000 square feet, collectively and in an
increasingly competitive environment, that kind of consumer behavior, such as
e-commerce giant Lululemon REI and specialty retailers, including Amazon.com
and could not adapt to the changes Athletica.
Sports Authority has approached a wide variety
of retailers, the sound leaking from the 140 stores that the company would try
to quit, Foss said, or provide a specific name in the mix to ensure that rival
Dick's Sporting Goods declining.
A & G Realty Partners, which is marketing
the leases on behalf of the Sports Authority, a retailer fly to other 87
subleases post.
Company officials did not yet reveal what
stores will be closed. Pending court approval, the closing sales could begin as
Friday, Foss said.
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