The American tradition of family photos from Sears (NASDAQ:SHLD) and Walmart (NYSE:WMT) may have ended on Thursday. Family photography mainstay CPI (CPIC), which ran studios in thousands of U.S. stores, abruptly announced it was getting out of the game — much to the surprise of Walmart, Sears, and its third major client Babies “R” Us. It is unclear whether CPI can make a comeback or if the retail giants will seek new vendors for the vacated store space.
For now, there will be no more of the brightly-lit family photos CPI was famous for delivering. The company’s relationship with Sears dates back to the 1950s and exclusive in-store portrait studios have been in place since 1986. While the relationship was long and storied, the ending was fast and unexpected. A Sears spokesperson told the Wall Street Journal the company was notified suddenly of CPI’s demise. Since there was no warning, Sears was at a loss to describe future plans.
Walmart, noting CPI ran studios in 20 percent of its stores, gave no word on the future of spaces previously occupied by the company. Though Walmart will undoubtedly find a way to stock and profit from the extra space, countless customers are still interested in the old-fashioned prints from retail stores.
CPI’s financial troubles did not begin recently. The St. Louis-based company faced an alarming string of losses in the past 18 months as liabilities rose and assets summarily dropped. While some observers suggest the days of herding the family into a Walmart studio are over, rival Picture People offers a clue of what still works. Picture People CEO John Johnson told the WSJ that it wasn’t the business model — but rather CPI’s execution — that fell short.
Johnson noted growth in his own company’s sales while suggesting that CPI’s policy of delivering prints weeks later was woefully out of date. Considering the technology at hand, portrait studios can easily deliver the photos in a short time-period — something Picture People does. In fact, the Blackstreet Captital-owned Picture People would seem to be a worthy replacement for CPI in both Walmart and Sears stores.
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