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10 Big Businesses That Failed

Let’s Check Out the Top 10 Big Businesses That Failed !!

Whenever successful businesses are squared with significant changes in their surroundings, they fail to adapt appropriately.

Most of those large corporations become powerless to assert themselves against their opponents with new products, technology, or methods.

As a result, their stock value plummets, their finest employees leave, and their profits and sales reduce.

And in this environment, only a few businesses eventually recover. Typically, this occurs after a series of severe reduction and reorganization exercises. However, most of the businesses don’t.

Entrepreneurs fail to adapt because it is “tough” for their leadership teams, business models, and organizational structures to transition to a new mode of thinking and doing operations.

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Rank Company
10. Kodak
9. Pets.com
8. Compaq
7. Tower Records
6. Borders
5. Pan Am
4. Toys “R” Us
3. Polaroid
2. Enron
1. Blockbuster

Big Businesses That Failed

The information has been gathered from the trusted sources like Wikipedia and Forbes.

10. Kodak (1888-2012)

Founded in 1888, Kodak ranks in 10th position on our list of top ten big businesses that failed, who once controlled the photographic industry before the introduction of digital cameras.

However, the company was unable to keep up with the digital revolution, and as a result, the firm filed for Chapter 11 bankruptcy protection in January 2012.

Kodak ( Source: Medium)

One of the primary reasons for the company’s downfall is that it was slow to adopt the digital ledger revolution despite having several opportunities to guide the firm in the correct direction.

Likewise, another reason is due to its prime concentration on films even after it bought the digital photo company “Ofoto.”

According to several industry analysts, the shifts of photography to cellphones were overlooked by Kodak.

Therefore, Kodak resurfaced in 2013, but it remained a modest company with a market value of $399 million.

9. Pets.com (1998-2000)

Pets.com, a well-known online shopping portal that supplied pet supplies, was established in 1908 and ranks 9th on our list of the top ten big businesses that failed.

At the beginning of 1999, Pets.com thrived in a competitive market with petsmart.com, petopis.com, and petstore.com.

Likewise, Pets.com had some success, even though it was short-lived, at a period when there were no ready-to-use e-commerce alternatives.

However, Pets.com is a well-known cautionary story of an elevated marketing strategy paired with unstable foundations.

As a result, the collapse of the firm resulted in the loss of $300 million in investors’ funds.

Therefore, because of the companies high public visibility throughout its limited existence, Pets.com became one of the most notable dot-com bubble disasters of the early 2000s.

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8. Compaq (1982-2002)

Compaq was a computer and information technology business based in the United States that was formed in 1982 and ranks 8th on our list of top 10 big businesses that failed.

The company was involved in creating, marketing, and maintaining computers and associated goods and services.

Similarly, in the 1980s and 1990s, Compaq became one of the world’s largest PC manufacturers.

However, after its merger with Digital Equipment Corporation (DEC), Compaq’s demise began. The company paid $9.3 billion to acquire DEC even though the company was not a good option for Compaq.

DEC, for instance, was a computer chip manufacturer. Compaq, on the other hand, had no ambitions to expand in that sector.

Furthermore, DEC processors were incompatible with Compaq computers.

In the end, Compaq couldn’t keep up with Dell and other competitors in the pricing wars.

Thus, HP bought the company for $25 billion in 2002.

7. Tower Records (1960- 2006)

On the seventh position on our list of the top 10 big businesses that failed, we have “Tower Records,” which was founded in 1960.

Tower Records was an online music shop and a retail music franchise with locations all over the world.

Likewise, the firm launched “Tower.com” in 1995, becoming one of the first shops to go online.

Big Businesses That Failed Tower Records
Tower Records Relaunches
(Source: Rolling Stone)

Tower Records grew globally after that, to nations such as the United Kingdom, Canada, Japan, Thailand, and Mexico, to mention a few.

However, the company filed for Chapter 11 bankruptcy for the first time in 2004.

The major cause for its downfall is attributed to aggressive expansion in the 1990s. Also, it resulted in a large debt load for the firm.

Similarly, Tower Records debt was projected to be between $80 million and $100 million on 4th February 2006.

As a result, it declared bankruptcy for the second time in 2006 under Chapter 11.

6. Borders (1971-2011)

Borders, a US-based book vendor with a headquarters in Melbourne, Australia, was founded in 1971. It ranks in 6th position on our list of top 10 businesses that failed.

Borders filed for Chapter 11 bankruptcy in February 2011.

Also, one of the reasons for the Border’s collapse was that it got too large, with too many businesses, so much so that it was not able to adapt to the new digital and online book market.

Furthermore, when the recession struck in 2008-09, it was already saddled with massive debt.

On the other hand, Borders did not build its own e-reader to compete in the market. And, it did not anticipate the advent of electronic books, like Amazon and subsequently Barnes & Noble did.

Therefore, Borders opened its online e-book store very late, i.e., in 2010, a year before it went bankrupt.

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5. Pan Am ( 1927-1991)

Pan Am was founded on October 19, 1927, and for most of its existence, it was the United States’ primary international airline.

The company was also recognized as a pioneer in the sector. It was the first airline to have a computerized reservation system for jumbo aircraft.

Likewise, during the late 1960s and early 1970s, the company was at its pinnacle, where it transported 9.7 million people.

Similarly, it transported 11 million people to 86 countries in the year 1970.

However, with the 1973 oil crisis, the airline began to experience a slump.

As a result of increased fuel costs and the impossibility of running domestic routes, the airline was beginning to lose money.

The gasoline crisis, on the other hand, was so severe that individuals did not flee abroad.

Thus, Pan Am declared bankruptcy in 1991.

Hence, the major cause of its demise is blamed on business incompetence, ineffective regulatory policies, and ignorance on the part of the government to safeguard its main international airline.

4. Toys “R” Us (1948-2017)

Toys “R” Us, which first opened its doors in 1957, is ranked #4 on our list of the top ten big businesses that failed.

The company had over 800 warehouse-format stores in the United States at its peak, with a similar number across the world being the world’s number one toy retailer.

Big Businesses That Failed Toys "R" Us
Toys “R” Us (Source: iStock)

However, as the number of online retailers and other merchants grew, the number of Toys “R” Us gradually declined.

As a result, on 18th September, 2017, the company filed for Chapter 11 bankruptcy.

The reason behind this was because it failed to remain abreast of technology and was unable to adapt to the changes that were occurring in the corporate sector.

3. Polaroid (1937-2001)

Polaroid was an American firm that was founded in 1937 and was well known for its instant film and cameras.

In 1991, the company’s revenue peaked at $3 billion, and it employed 21,000 people at its height in 1978.

Though it was one of the first digital camera manufacturers in 1996, they were unable to get a significant proportion of the market in that sector.

Hence, Polaroid overlooked the need to expand into new markets and improve their long-term profitability.

They were only concerned with promoting their long-standing and profitable business without realizing the increase in competition and change in customer preferences.

Therefore, they failed to foresee the influence of digital cameras on the film industry.

So, Polaroid filed for bankruptcy in 2001 as a result of this.

2. Enron (1985-2001)

Founded by Kenneth Lay on July 16, 1985, Enron ranks in 2nd position on our list of the top 10 big businesses that failed.

Enron Corporation, headquartered in Houston, Texas, was an American energy, commodities, and services conglomerate.

Similarly, Fortune magazine rated it America’s most innovative firm for six years in a row.

At its peak in January 2000, Enron had a market capitalization of over $70 billion, with shares selling at around $90 each, making it the seventh-largest company in America.

However, Enron’s involvement in corporate misconduct and accounting fraud was revealed in October 2001.

As a result of the Enron controversy, the company actually collapsed. Furthermore, its workers were laid off, and billions in pension benefits were lost.

1. Blockbuster (1985-2010)

Blockbuster, an American company that rents out movies and video games, was formed on October 19, 1985.

It had 133 locations by the end of 1987, and in terms of income, it was the sixth-largest video chain in the country.

In 2004, Block Buster was at its height. This year, it began selling games and DVDs at a few chosen U.S. shops.

Big Businesses That Failed Blockbuster
Blockbuster (Source: Business- Insider)

Likewise, by this year, blockbuster had 9,094 locations across the world, with a total workforce of 58,500 people.

However, in 2010, blockbuster declared bankruptcy after failing to shift to a digital business.

One of the primary reasons for its failure, therefore, was a lack of competent leadership and infrastructure to make the transition to a streaming-centric future successfully.



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