Bowman grimly starts his article by referring to Staples Inc. current’s situation as a “familiar predicament”. He explains that the company remains profitable, but also states that the office-supply retail isn’t as prevailing as it once was. There has been a number of merges, namely Office Depot and Office Max’s case in 2013, which suggests that this is the latest strategy to somehow save the business.
Not a single favorable prediction is ahead of the company, as Bowman continues describing the maneuvers Staples has tried implementing. After its acquisition of Office Depot for 44% of the value that it had the day before the trade, the Federal Trade Commission interfered with the deal, with their lawyers reporting that settlement talks were still on going. In addition, the company’s leadership seems to be defied by the likes of more recent giants such as Amazon.com and Walmart Stores. Improving is scarcely possible, as statistics show that North American retail sales fell 8% in the most recent quarter, and about 12% of its stores being shut down (about 225 underachieving retail stores). Nevertheless, Bowman admits that a good reason for investing in Staples is that the company is still profitable and their earnings have a slow declining rate.
It’s difficult to project any good news about the future of Staples. This may be more likely related to the fact that the market is changing. Demand of the services and goods the company is offering is slowly decreasing and investors are reluctant to fund a business that is not doing well amidst the immense market transformation. A market research is imperative and imminent in order to find a different set of strategies to mutate and evolve towards recovery and growth.
Works Cited
Bowman, Jeremy. (2016, January 19) Will 2016 Be Staples, Inc.’s Worst Year Yet? The Motley Fool. Retrieved from http://www.fool.com
