Pan American World Airways, Standard Oil, F.W. Woolworth, and Circuit City were once giants of American business. Today these companies exist only in people’s memories. Changing consumer tastes, evolving technology, corporate complacency, and bad business decisions ended these iconic brands.
The collapse of quintessential companies may seem abrupt to a casual observer. But plummeting revenue, leadership changes, and sudden layoffs can predict companies’ deaths. Of course, some step back from the ledge. Apple and IBM both made impressive turnarounds. Yet for every success story, many companies can’t get off life support. These 18 companies, including a famous jewelry store and a family-friendly restaurant, are among the walking dead.
1. Bloomin’ Brands
Earlier this year, the owner of Outback Steakhouse, Carrabba’s Italian Grill, and Bonefish Grill announced it was closing 43 of its 1,500 restaurants. The three chains all experienced negative 2016 sales and hoped for a better 2017, but things don’t look good. To compete with fast-casual chains and delivery services, Bloomin’ Brands re-evaluated its strategy for 2017, reducing promotions, enhancing delivery services, and renovating existing locations. Sadly, shares still dropped 8% further in July.
Next: This historic department store can’t compete with online sales.
We’ve discussed the venerable department store’s problems in the past, but it boils down to stiff competition from retailers (including online stores), changing consumer habits (many don’t shop at department stores anymore), and the high cost of labor. Now Macy’s has announced new leaders in many executive positions. The retailer may have turned things around in the nick of time. Forbes is optimistic about Macy’s new strategy to focus on consolidating its operations “into ‘five families of business’ (Ready to Wear, Center Core, Beauty, Men’s and Kids, and Home).”
Next: This social media platform’s struggles surprised many.
Twitter may be the current President’s preferred communication tool, but that’s not helping the company, Bloomberg reports. The former tech darling has struggled as newer social media platforms like Snapchat and Instagram capture people’s attention. Twitter tried to sell itself in 2016, but potential partners backed off. What’s next for the company is anyone’s guess. Twitter released its second-quarter earnings and takeaways; users are down about 3% (quarter to quarter) and revenue is down 4.7% from 2017, but it still surpassed analysts’ expectations.
Next: Hungry people have many sandwich options these days.
Quiznos used to be the fastest-growing restaurant chain in the country. Now it’s hard to find a place to buy one of its toasted sandwiches. The chain declined to 690 U.S. stores in 2015, from a peak of 5,000 in 2007, according to BuzzFeed. Competition with chains like Jimmy John’s and Firehouse Subs is partly to blame for the company’s fall, according to Forbes. The company hired a new CEO, Susan Lintonsmith, last year. It has tested two Quiznos-inspired concepts in its hometown of Denver; one didn’t last, and the toasted sandwich’s future is still uncertain.
Next: “Paying less” is not enough to keep this shoe retailer afloat.
The budget-friendly shoe chain declared bankruptcy earlier this year and concluded court protection “after shedding more than $435 million in debt and closing approximately 673 stores,” according to USA Today. With CEO Paul Jones retiring, Payless will search for a new leader as they must get creative with its future in the retail industry. Between online competition and shopping malls struggling to attract consumers, the Kansas-based company still faces a long, hard road ahead.
Next: Everyone used to recognize this name, not as a fruit, but as a phone.
BlackBerry introduced many people to the smartphone. But by mid-2016, the company’s share of the global smartphone market was less than 1% because the company failed to evolve, and its phone sales plummeted. In September 2016, the company announced it was leaving the business of making phones, the Wall Street Journal reports. Instead, it’s shifting to developing software, and this seems to be a wise decision. Its Indian hardware partner, Optiemus Infracom, is projecting $350 million in revenue and $2 million in sales of BlackBerry handsets in 2017, according to industry website SeekingAlpha. They may have pulled off an epic comeback.
Sears was once one of the biggest names in American retail. Today it’s barely hanging on. Stores have closed and sales are falling as shoppers abandon the chain. (Sears Holdings also owns Kmart, which has its own problems.) Some think the retailer may die in the next year or two. “A liquidity event is a matter of when, not if,” Greg Melich, an analyst with Evercore ISI said in a February 2016 report, according to Bloomberg. Even Sears execs have doubts that the chain can “continue as a going concern.”
Next: No one is eating good in the neighborhood.
DineEquity, the owner of both Applebee’s and IHOP, is struggling to attract diners as fewer families eat out and millennials prefer local restaurants and fast-casual chains. Applebee’s sales dropped 5% in 2016, and DineEquity announced it needed to close 107-135 restaurant locations this year — double what it originally projected. It’s also closing at least 20 IHOP locations. Get your Rooty Tooty Fresh ‘n Fruity pancakes while you still can.
Next: This buffet needs a serving of success.
9. Old Country Buffet
Miss the Old Country Buffet at your local mall? So do many other hungry diners who tried to visit an all-you-can-eat dining experience only to find their local restaurant closed. Ovation Brands — owner of Old Country Buffet, Hometown Buffet, and other all-you-can-eat restaurants — shuttered dozens of its locations without warning in March 2016. More locations closed without notice in June, Consumerist reports.
Ovation Brands has filed for bankruptcy three times since 2008. It’s also had to pay more than $11 million to a Nebraska man who came down with salmonella after dining at one of the chain’s restaurants. The end of the all-you-can-eat steak, potatoes, and ice cream buffet may arrive soon.
Next: This shoe brand is the butt of many jokes.
Crocs’ declining stock spells trouble for the plastic shoe retailer. It announced the closure of 160 stores by the end of 2018, and Forbes attributes this to its losing battle against other companies’ athletic shoe offerings. Crocs’ restructuring strategy includes cutting operational costs and narrowing down its product offerings.
Next: This struggling health brand is on life support.
When Elizabeth Holmes claimed to have invented a new blood testing device that uses a single drop of blood to screen for hundreds of conditions, the media went gaga. The technology offered by her company, Theranos, was “mind-blowing” and would give people “an unprecedented window on their own health,” Wired gushed in a 2014 article. That year, Theranos was valued at $9 billion.
Everything was rosy until a 2015 investigation by the Wall Street Journal revealed its testing technology didn’t work. Holmes, who once topped Forbes’ list of the richest self-made women, saw her net worth estimate fall to $0. Theranos settled two lawsuits brought by a hedge fund that invested $96.1 million. The company still faces lawsuits from Walgreens (a former investor) among other entities. ArsTechnica reports that Theranos “only has $150 million in cash on hand, which does not account for debts and any payouts from the settlement announced today.”
Next: Sexual harassment allegations didn’t help this risqué apparel brand.
12. American Apparel
In the late ’90s, American Apparel took over teen closets with its made-in-America T-shirts and other basics. The chain expanded quickly, gaining as much attention for its racy ads as its manufacturing practices. In 2007, the company was valued at $1 billion, but the twin problems of the 2008 economic crisis and a series of sexual harassment allegations against founder Dov Charney put it into a death spiral, ABC News reported.
The company hadn’t turned a profit since 2009 and filed for bankruptcy twice in the past few years. Finally, Gildan Activewear, a Canadian company, bought American Apparel’s intellectual property and some of its manufacturing equipment in early 2017, but not its remaining 110 stores. The brand name may live on in some form, but the company as most knew it is gone.
Next: Trendsetting millennials aren’t interested in this classic jeweler.
13. Tiffany & Co.
Saying Tiffany & Co. is on the brink of death might be dramatic, but the iconic jewelry store is definitely struggling. The abrupt departure of CEO Frederic Cumenal in February 2017 sunk share prices, even in the wake of a splashy Super Bowl ad featuring Lady Gaga.
The chain is struggling to replace aging baby boomers with younger shoppers, and its designs don’t capture the attention of trendsetters, Bloomberg reports. The company may also have focused too much attention on attracting gift buyers (primarily men purchasing for their wives and girlfriends) rather than reaching out to the “self-purchasing women” who make up an ever-growing share of jewelry sales, Racked reports.
Next: Shoppers are stepping out on this shoe retailer.
14. Nine West
Nine West also made an appearance on Fitch Ratings’ list of possible retail bankruptcies. The shoe company has “weak operating performance and very high debt and leverage burden,” Moody’s notes, which downgraded Nine West’s credit rating to negative. “[T]he company’s capital structure is unsustainable and its probability of default … is high,” Moody’s adds, noting that the company has slid for years and doesn’t show signs of a turnaround.
Next: This production company won’t have a Hollywood ending.
15. Relativity Media
Upstart studio Relativity Media created movies like 3:10 to Yuma and Limitless, but those early successes didn’t translate into financial stability. The company emerged from a bankruptcy proceeding in 2016, but it still couldn’t find its footing. A couple of big-time flops, including Masterminds, starring Zach Galifianakis and Kristen Wiig, hurt the small studio, which also sued Netflix for supposedly trying to force it out of business, the Los Angeles Times reports.
Employees were furloughed, the CEO and founder stepped down, and the company owes nearly half-a-million dollars in back rent on its Beverly Hills office. Hollywood may love a comeback story, but the chances of a sequel for this company seem slim.
Next: Ear piercing services aren’t enough to turn a profit.
If you surveyed American women, most would say they got their ears pierced at a Claire’s store (they claim they’ve pierced 94 million ears). But today’s tweens may have to go elsewhere for that formative experience. The mall jewelry chain, which a private equity firm purchased in 2007, recently canceled its IPO and is struggling to turn a profit. Claire’s is one of many stores that Fitch Ratings predicts will go bankrupt in 2017, Bloomberg reports.
Next: You’ll see less and less of this name at local malls.
Teen-focused clothing chain Aeropostale filed for Chapter 11 bankruptcy in May 2016, simultaneously announcing that it was closing 154 underperforming stores. Competition from fast-fashion retailers like Forever 21 and H&M causes problems for the once-popular store, along with similar chains like Abercrombie & Fitch and American Eagle. Aeropostale was the weakest of the “three As,” according to analysts.
Aeropostale may hang in there, though. Mall operator Simon Property Group didn’t want the chain to go under, since it would leave vacancies at its properties. In September, Simon and its partner, General Growth Properties, rescued the chain, which was in the process of being liquidated. In 2017, more than 500 stores reopened.
Next: This popular women’s clothing retailer is seeing “limited” success.
18. The Limited
Teen girls from the ’80s or ’90s probably remember The Limited. But if they want to relive the experience, they’re out of luck. Early in 2017, The Limited announced it was closing its remaining 250 stores and cutting 4,000 jobs. Then it filed for Chapter 11 bankruptcy protection. None of this sounds good, but the brand may still have a future, according to a Columbus Dispatch report. A private equity firm bought the company’s intellectual property, and it may operate the stores online.
Additional contributions by Ali Harrison.