2008 was the year of disappearing brands
More businesses may find themselves on life support in the year ahead
NEW YORK - Shoppers won't be picking up ornate lamps from the Bombay Co. in the coming year. Or investing with Lehman Brothers and Bear Stearns. No flying to Hawaii on Aloha Airlines, either.
All those names vanished this past year, victims of the economy, the financial meltdown, or other factors. Experts say 2009 could mark the end of more brands as the recession puts more companies on life support.
"I think 2009 is going to be a bloodbath," said Scott Testa, a marketing professor at St. Joseph's University in Philadelphia.
The woes of the nation's retailers began before the year even started. The Bombay Co., known for its home accessories, filed for bankruptcy in the fall of 2007 and shuttered the last of its stores in January 2008 because of slow sales.
Travelers also bid adieu to some airlines. Aloha, ATA, Skybus, and Champion Air grounded their planes.
And two of the biggest names that disappeared last year took the economy and consumer confidence down with them.
Bear Stearns was headed toward collapse in March, before the government engineered a fire sale of the 85-year-old investment bank to JPMorgan Chase & Co. And the credit crunch that paralyzed the world economy only got worse after Lehman Brothers became the biggest bankruptcy in US history.
The ripple effect those two failures had was evident at malls across the nation. Consumers, already nervous about the falling value of their homes and the security of their jobs, curtailed spending even more.
With sales and profits dropping and lenders leery of granting new credit, a number of retailers failed. Home goods seller Linens 'N Things began liquidating its stores. Apparel chain Steve & Barry's did the same.
The vanishing acts weren't just in the United States. British retailer Woolworths Group collapsed after it was unable to sell its 800-store business.
Beyond the brand names customers will no longer see, people may find many familiar businesses looking different. Retailers may operate fewer stores or only sell their goods online. Banks may become subsidiaries of those that bought them.
Circuit City Stores Inc., the nation's second-biggest electronics retailer, is closing more than 150 stores and laying off thousands as it attempts to restructure under Chapter 11 bankruptcy.
The shakeout among companies this year will give sturdier brands a chance to shine and set them apart from their less-than-prosperous counterparts, analysts said.
Who's gone awayA number of big-name brands filed for bankruptcy protection or went out of business in 2008. Among them:
Retailers Mervyns LLC filed for Chapter 11 bankruptcy protection in July and began liquidation sales at its remaining stores to wind down its business.
Linens 'N Things filed for bankruptcy protection in May. It started liquidation sales in October after failing to find a buyer.
Steve & Barry's filed for Chapter 11 bankruptcy protection in July, then abandoned plans to keep stores open and said it would liquidate.
KB Toys filed for bankruptcy protection two weeks before Christmas and has begun to liquidate its stores and plans to shutter operations.
Banks, investment firms
Bear Stearns was bought by JPMorgan Chase & Co. in March in a deal orchestrated by the government after a sharp decline in shares and a collapse in confidence in the company.
Lehman Brothers Holdings Inc. declared bankruptcy in September, the largest ever in the United States, less than a week after reporting a $4 billion loss.
Airlines ATA Airlines filed for bankruptcy April 2 and abruptly ceased operations the next day.
Aloha Airlines shut down its passenger service in March, shortly after filing for bankruptcy.