because they keep getting bought up in Bain Capital style leveraged buy-outs and then saddled with debt that prevents them from adequately competing with Amazon. To cut costs they turn their stores into dirty little warehouses. This is what happened to Toys R Us. And they were one of the lucky ones. They survived 13 years before the debt crushed them.
If Trump doesn't like the post office subsidizing Amazon there's a really, really easy solution: raise the rates. Problem solved. And if he doesn't like how they treat their workers he could raise federal minimum wage and drop the work week to 30/week before overtime kicked in. The latter might require congress to act but it's popular enough that if he'd stop attacking them on Twitter and take congress to task for not doing anything for the working man he'd have it done in a week. Especially if he did it right before mid-terms.
But this is all just a distraction. And an political attack on a company run by people that don't particularly like him. It'd be funny watching to rich and powerful guys in a pissing match if their actions didn't effect me so drastically.
The reason they get bought up in Bain Capital style leveraged buy-outs is because the businesses were doing poorly due to competition from Amazon. Private Equity doesn't buy businesses that are doing well!
That's the point. You buy a business that is worth a lot so you can get huge loans on their name. Then you pay yourself huge consultancy fees and salaries from those loans. They couldn't get the loans if the businesses were on the way to failure.
Toys R Us was doing quite well... through Baby's R Us. They were basically shifting over to a baby retailer with a small toy division until they had the rug pulled out from under them.
Huh? They paid only 6.6B for Toys'R'Us. http://money.cnn.com/2005/03/1... [cnn.com] Show me an example of a private-equity purchase of a non-struggling company. When companies are doing well, especially public companies, they tend to resist sales. You're right about things like loading up with debt and all of the problem that come with a private equity purchase. But no company ever has a private equity sale as their 'exit' strategy. It's what you do when your business isn't healthy. Now I realize that 6.6B is
Most of those retailers are out of businesses (Score:5, Insightful)
If Trump doesn't like the post office subsidizing Amazon there's a really, really easy solution: raise the rates. Problem solved. And if he doesn't like how they treat their workers he could raise federal minimum wage and drop the work week to 30/week before overtime kicked in. The latter might require congress to act but it's popular enough that if he'd stop attacking them on Twitter and take congress to task for not doing anything for the working man he'd have it done in a week. Especially if he did it right before mid-terms.
But this is all just a distraction. And an political attack on a company run by people that don't particularly like him. It'd be funny watching to rich and powerful guys in a pissing match if their actions didn't effect me so drastically.
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Um... yeah they do (Score:2)
Toys R Us was doing quite well... through Baby's R Us. They were basically shifting over to a baby retailer with a small toy division until they had the rug pulled out from under them.
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If Trump doesn't like the post office subsidizing Amazon there's a really, really easy solution: raise the rates. Problem solved.
That would be great. I'm long on UPS.