The list of struggling companies worldwide just gets longer and longer. Everyday you expect to hear financial meltdown across various industries. With over £300 million in debts, the company is finding it very hard to operate its 800 retail shops in light of the credit crunch. Even the sale of the company has been brought to the table.
American Hilco, the reorganization experts are looking into buying the company straight out and assuming its debt. If a deal is not reached soon, 30,000 jobs are on the line. This is a time of caution and damage control for Woolworths seeking to survive in the present financial crisis. The aim of Woolworth’s is to be bought out or seek help in cutting down operations strategically and becoming leaner.
The fierce ever growing competition in the market and the rise of Internet commerce over the past 15 years or so has put Woolworths, over the years, in an awkward financial situation. With a narrower focus on family and home entertainment, it can be argued that Woolwoths has lagged due to its traditional habits and not being quick to compete or diversify its product range vis-à-vis the competition. Companies like HMV, ZAAVI, Arogos, Asda, Tesco and Primark have contributed to the demise of Woolworths, and now it is left far behind with a poor selection of products and quality, as well as bad pricing strategies. I never knew they had 800 shops; maybe I’ve been blind all these years. I’m just used to seeing the occasional odd shop in the occasional odd and run down area.
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