Blockbuster Trying To Fend Off Bankruptcy Filing
Blockbuster is on the knife’s edge when it comes to filing bankruptcy. The company seems all but done, yet still keeps staggering along trying to find a solution to its horrific finances.
There business world is forever changing. Much of the recent change can be attributed to the massive changes the internet has brought over the last fifteen years. Blockbuster provides a picture perfect example of this and also a clear picture of why it will not survive in the future.
Experts Your Questions Now.
Blockbuster used to be the big boy on the block when it came to move rentals. You would grab the family and drive over to rent a flick for the night. To be honest, it was fairly aggravating. The store would have a limited selection and you would often find the move you really wanted was out. Still, Blockbuster was the dominant company and controlled the market in almost a monopolistic fashion.
Then the web went big. Along with it came a little company called Netflix. It was amazing. Instead of driving to a store that had limited selections, you could browse through a site online and select what you wanted from a huge database. Even better, the company would send you the DVD in the mail and you could just send it back whenever. The day Netflix opened was the day Blockbuster started to die.
From A Bankruptcy Lawyer Now.
Blockbuster has been struggling the last few years with massive amounts of debt. As of July 4, the company had a staggering $924 million in debt and $60 plus million in cash. I was closing stores right and left in an effort to cut its losses. Still, the fewer the stores, the smaller the total revenue to deal with said debt. The only hope for Blockbuster is to slash its total debt by negotiating with creditors. The creditors, however, have to be convinced that there is some hope in the future from which they will be paid.
The current outlook is not good. Blockbuster has announced it is putting off a decision on bankruptcy till September 30, 2010. The question is why? This is a dead company pursuing a dead business model. Blockbuster had its day, but that day is long past.