Learn about the 15 Companies that are on the Verge of Going Bankrupt
Hello Aluxers and welcome back! Today we’re examining which companies and industries are dealing with problems, and will possibly be facing bankruptcy in the near future. Not everyone can survive the new wave of brands, social media advertising, influencer marketing and emerging markets so many companies go bankrupt. It’s a tough market out there even for the big guys.
With online shopping gaining so much interest, more and more brands are closing stores and cutting down on operations to survive. Even Tesla is closing down shops, keeping only a few open as galleries. And since Amazon is putting its eggs in all the baskets out there, they’re disrupting all the markets.
Weather it’s beauty, clothing, technology or bookstores a lot of famous brands that have been on the market for decades are going bankrupt. Save your tears, new ones are replacing them every month and possibly better ones. Some say even Google, Facebook or Burger King are out there in the risk area so you never know. With that being said, let’s see which companies will go bankrupt in the near future.
- 1: Victoria’s Secret
- 2: Diesel
- 3: FitBit
- 4: GAP
- 5: AVON
- 6: Roberto Cavalli
- 7: Revlon
- 8: 99 Cents Only
- 9: Sears
- 10: Snapchat
- 11: GoPro
- 12: HTC
- 13: Norwegian Airlines
- 14: Sprint
- 15: Barnes and Noble
- 16: Apple
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With that done, let’s go straight into the article:
1: Victoria’s Secret
By far one of the most recognizable and wanted brands in the world is Victoria’s Secret. The lingerie brand has always had a soft spot in women’s heart. Their strategy to use famous models, crazy designs and amazing shows has helped with sales for years.
Nowadays, although the shows are very hyped, sales are going down and stores are closing. People are not buying so much from the brand and it might also be due to their lack of body inclusivity and plus size models. People want to buy from real brands that promote real women, not Victoria’s Secret angels. They show all the signs or a near bankruptcy.
Diesel is a very famous company that has worked with a lot of celebrity and influencers over the years to boost sales and awareness. But with the rise of so many new brands, online shopping and Instagram brands they have been forgotten.
They filed for bankruptcy in March 2019 and are now planning to revamp the brand and hopefully make some money and pay their debts. If this strategy doesn’t work they we can say bye bye to Diesel clothes forever.
The sports industry isn’t safe from the huge disruption either. Since it went public in 2015, FitBit hasn’t been doing so good as they’d want to. They’re not the only brand on the market, and with Apple’s launch of the new Apple Watch and other smart watches, FitBit has been going down.
Sales are not looking good for the company, neither the stock price, so most sources say that FitBit is among the brands that might be going out of business soon. Competition is fierce in the wearables industry and FitBit can’t compete with some of the new technology Samsung or Apple bring out.
Resource: Most Expensive Smartwatches in The World
It seems that the fashion industry is facing a new era, one of new brands. GAP is another brand that has been almost forgotten by people along with Abercrombie and Fitch and J Crew. Gap announced the closure of hundreds of stores nationwide and that usually means one thing: bankruptcy.
Even more, their Old Navy retails store is going to be split off and turned into an independent company. The end of the mall era in many countries has forced brands to shut down stores and focus on online sales. Some of them didn’t survive this stage and Gap seems to be one of them.
The giant beauty company AVON is not as popular as it used to be. With famous beauty stores such as Sephora or Ulta, buying from a catalog or a beauty consultant that knocks on your door is a thing of the past.
There is a study conducted by The University of Vermont in which they claim that AVON will go bankrupt by the end of 2020, because they’re too late to the .com party and because their income is based on emerging markets such as Latin America which is not reliable.
6: Roberto Cavalli
Who remembers the days in the early 2000 when Cavalli was all over the place, from the red carpet to the street. The Italian fashion house closed all of its USA stores and filed for bankruptcy as some sources say.
The point is that they are liquidating all the brick and mortar stores in the USA, but then again most brands are doing that. They’re now looking for an investor to keep they day to day business on, but since their competitors are doing so well only a genius would bring back the hype around Cavalli.
Resource: Ciara Is The New Face Of Roberto Cavalli
In the beauty department the battle is a bloodbath. Revlon is a well known and loved drugstore brand by people, but with so many other affordable brands coming out it’s hard to stay loyal to one brand. And if the prices of your competitors are better, there’s no escape.
Although Revlon is not dead, they have a strong chance of filing for bankruptcy in the near future. With so much offering and so many collaborations launching every month, big brands like Revlon are slowly being forgotten and replaced.
8: 99 Cents Only
Another one at risk is 99 Cents Only chain. They have been on the verge of bankruptcy for a few years now and most sources marks them as vulnerable. They’re fighting with Dollar Tree, Dollar General and WalMart for market share and the battle is fierce.
Unfortunately, the company is losing money and has been battling net loss of millions of dollars each quarter. The future isn’t too bright for this retailer and the fact that is closing some of the stores is a sign of money problems.
One of the biggest surprises of this list is Sears. The company has declared bankruptcy and now the owner bought it back to revive it. He paid 5.2 billion dollars to get it back, but experts don’t think it was such a good idea.
Sears used to be one of the world’s largest stores and was considered an early innovator of the shopping landscape. In the last years, they’ve been closing stores and seeing a drop in sales. We have to see now how the new strategy will keep the company from going bankrupt again.
There was a time when Snapchat was so popular that everyone was using the dog face filter. Since its launch in 2011, the social media app has been up and down, and nowadays more down than ever.
Even after Kylie Jenner’s tweet from 2018, the company has been losing money and users constantly. The rise of InstaStories and Facebook has buried Snapchat. People cannot keep up with so many platforms, and since Instagram and Facebook has all the features Snapchat offers and many others, they won. Sources say that it might get acquired by Amazon or Vox by 2020 to avoid bankruptcy.
Since we’re talking about Snapchat, here’s a video you might want to see: 15 things you didn’t know about Evan Spiegel, the founder of Snapchat.
When the tiny GoPro camera launched a few years back it was seen as a disruptive product in the industry. They were of good quality, portable and very easy to use. Although they launched a few models over the years and some great campaigns, they’re not doing so well.
Since smartphones have such great cameras, there is no need of buying an extra one to shoot under water or mount it on your helmet. And with the new trade tariffs with China they need to move their factories in other countries. Sales gare not looking so good either, so they might not last so long.
On the same note of smartphones taking over the market, we’re seeing how many brands we’ve used a few years ago are now slowly dying. HTC used to be among the strongest competitors on the market and now is almost unseen in stores.
The same goes for LG or Sony, who stopped bringing out new smartphones in the last few years. HTC still insists on producing phones, but they will need a strong strategy to beat up Apple, Samsung and Huawei. Do any of you guys still have an HTC smartphone?
Resource: Best Smartphones Available Now | Top 10
13: Norwegian Airlines
In the airlines department things are not going very well either. A lot of companies, including AirBus are struck with loss and possibly bankruptcy. There used to be a time when Norwegian Airlines was very popular, but nowadays not so much.
People demand better services and politics from airlines and not all of them can deliver. They have been selling a few aircrafts and increased flight time to reduce ground time. With such low fares for long flights, some people don’t trust they company and since business is so bad right now, the future looks uncertain for this airline.
A famous american telecom company that is in foresight of bankruptcy is Sprint. They are on the verge of merging with the giant T-Mobile and when that happens, Sprint will be forever gone. This deal might be more beneficial for Sprint users.
T-Mobile will let Sprint users jump on their network when if Sprint isn’t available, which should yield better coverage in more places. This merger was bound to happen years ago, but the White House insisted on having 4 competitors on the market. Whatever happens in the future with clients and the new established company we’ll have to wait and see.
15: Barnes and Noble
The final chapter for this bookstore is bound to end anytime now. Gone are the days when bookstores were full of clients and books were sold like CDs. Nowadays, people read books online, listen to books or read no books at all.
With strong competitors such as Amazon and the online frenezy, brick and mortar stores are slowly dying, including bookstores. The company has been sold to a hedge fund, now we wait to see the new strategy or the death of Barnes and Noble.
Although these companies we mentioned are in the danger, know that almost no one is safe. Some markets are highly unpredictable and business is tough. 2018 was the year of retail bankruptcy and 2019 doesn’t look better for some. The next year will be even harder for companies and so on. Business really is a shark tank.
With that in mind, we’re now curious to know where would you invest 1 million dollars if you had it? Let us know in the comments below.
And since we know some of you are still here, patiently waiting, we have a bonus fact totally different from the bankruptcy vibes and with a lot of zeros.
The Top 3 companies with the biggest market capitalization in the world are from America. Apple is the richest company in the world, followed by Microsoft and Amazon. Combined they’re worth almost 3 trillion dollars, showing just how strong american economy is.
Apple alone has been exceeding the trillion dollars mark in 2018 and it was considered a historic event. They’re in one of the most competitive and unpredictable markets and have been close to bankruptcy once. Steve Jobs would have been proud.