CLOSED. It’s more than just a sign on a door – it’s a sign of the times.
The longest recession in the history of the U.S. is claiming more victims, and they aren’t just mom and pop retailers this time – they are big national chains who are shuttering thousands of locations around the country, according to a new list of troubled retailers recently released by Forbes Magazine.
You know the names – Eddie Bauer, Lane Bryant, Zales – and there are many more. Their demise didn’t start with the recession, however, according to Darlene Quinn, a former senior executive with the Bullocks Wilshire department store chain and author of the novel Webs of Power, from Emerald Book Company (www.darlenequinn.net). Quinn was there when corporate raiders started consolidating the big chain stores and siphoning them dry. Quinn knows the inner workings of senior retail chain management, and has a unique insight to how the industry has found itself sitting on the ledge, looking down.
Darlene Quinn has seen the inside of the retail chain boardroom, and she has studied the demise of major chains like Marshall Fields, so she saw the recent spate of retail closings coming a few miles away.
“Many of our favorite department stores are vanishing,” Quinn said. “While the predatory, corporate raiders got the ball rolling through hostile takeovers in the 80’s, we are all, in part, responsible for their demise.”
Having announced 11 store closings, it’s no secret that Macy’s, one of the country’s most beloved and significant chain department stores, is in trouble. Quinn, however, has high hopes for the chain.
“Macy’s is in a lot of trouble right now, and they keep talking about expanding when this crisis is over,” Quinn said. “I think personally that they will lose a lot of stores, but I think in the end, they will survive. Terry Lundgren is very positive, and he runs an organization in which he hires the right people and allows them to do their jobs. He has a very different management style than most big retailers, and that’s one of the attributes that will help Macy’s weather the storm. Typically, in a downturn, big chains close down underperforming stores, and the 11 stores that Macy’s has closed are all underperforming, so they are doing the right things at the right time.”
The train started moving toward disaster nearly 20 years ago with a wave of leveraged buyouts in the retail sector that led to a great number of popular chains being owned by a smaller number of conglomerates and holding companies, Quinn added.
“The buyouts in the 80’s allowed corporate raiders to swoop down on businesses (many of which they knew little or nothing about) purchase them, using mostly Other People’s Money, and drive them into chapter 11,” she said. “In many cases, the raiders cared little about the businesses they were taking over. The business of America became the taking over of business. The goal was not to grow these businesses; the goal was to line their own pockets.”
About Darlene Quinn
Darlene Quinn is an author and journalist from Long Beach, California. Her novel, Webs of Power, is about the back-room wheelings, dealings and double-dealings behind the scenes of a national retail chain, based primarily on real-life people and companies Quinn encountered during her career in the retail industry. As part of a nine-member management team for the Bullocks Wilshire Specialty Department stores, Quinn has the insider’s perspective on the rise and fall of major department stores.