This American Company Was Ruined

At one point among the largest retailers in America, Sears merged with KMart in 2005. The marriage was a disaster. Neither company could successfully make a move to the big box, discount model which had been so successful with Target and Walmart. And has been the case with many brick-and-mortar retailers, Amazon ate away a large sum of revenue.

JCPenney hired the head of Apple’s retail store operation in 2011. The theory was his highly successful approach to store configuration and marketing was portable. This new CEO, Ron Johnson, presided over a nearly immediate 25% drop in sales. John was out in less than two year, and Penney never recovered.

Borders faced two forces it could not overcome. One was competition from the much larger Barnes & Noble. The other was the move of book sales online. The company was liquidated in 2011.

Barnes & Noble did not learn the lesson about competing with Amazon that should have been driven home when Borders failed. Not only did people buy books online, but Amazon also began the wave of people who read books on electronic devices. Book stores became increasingly unnecessary after Amazon launched its Kindle e-reader in 2007.

IBM was America’s preeminent technology company for eight decades. Late in the 20th century, it made two major mistakes. The first is that it allowed Microsoft to build the software that ran on the PCs IBM began to build in 1981. The decision helped start one of the world’s largest companies. IBM was also late to cloud computing, which is now dominated by Amazon.

Chrysler was part of Detroit’s Big Three, although smaller than GM or Ford. Poor product choices drove it into bankruptcy in the 1980s. Car legend Lee Iocca turned the company around. The reprieve was short-lived. In 1998, Daimler-Benz, parent of Mercedes, merged with Chysler, and once again, its product quality deteriorated. The company filed for Chapter 11 again in 2009. It is now a tiny division of auto company Stellantis.

Eastman Kodak was among America’s great corporate innovators. It invented photographic film, for all intents and purposes. Amateur photographers rarely turned to any other film product. By the turn of the last century, most photography was done with digital cameras. Kodak was slow to make the transition. It went bankrupt in 2012.

Singer began to mass produce sewing machines in the 1860s. Over the course of World War II, it moved from being the eight-decades leader in its industry to a weapons manufacturer. By the end of the war, it took back its poll position. For reasons that have never been completely understood, Singer began to diversify into industrial and business to business products. It also had to contend with new, popular Japanese products. It filed for Chapter 11 in 1999.

The U.S. was, for decades, the steel capital of the world. In the last 50 years, competition emerged in Japan and South Korea. As the 20th century started, Bethlehem was one of the largest industrial companies in America and had added shipbuilding to its portfolio. Its largest challenge was steel made in Asia that had lower labor cost. Despite a brief comeback in the late 1980s, Bethlehem Steel’s market share continued to fall, and it went bankrupt in 2001.

Republic Steel’s list of problems are nearly a carbon copy of Bethlehem’s. Prosperous for 60 years, it ran into foreign competition in the 1970s. In 1984, it merged with Jones and Laughlin Steel, which created cost efficiencies for both companies. This allowed it to survive. After several restructurings, it became part of RES in 2005. RES was in turn bought by Mexico’s Industrias CH, S.A de C.V. in 2011.