Why do so many companies in Metro Detroit go bankrupt?

[Detroitnerd]

Because they're run into the ground by management?

Just wanted to get one in before people start union-bashing...

[DetroitDad]

Because they're run into the ground by management?

Just wanted to get one in before people start union-bashing...

Unions are filled not because they want to see people fail, but because they are trying to shelter themselves from reality and/or change. No other reason.

[Detroitnerd]

When Borders was making money, they kept trying to gut the one thing people LIKED about them: That intelligent, well-read people were able to give expert advice to book-buyers. Instead, they cracked down whenever the work force tried to unionize, tried to turn them into low-paid "stockers" who knew nothing about books, and began an ill-fated expansion into CDs and DVDs [[remember them?). The whole while, they were using their profits to buy back stock and increase their personal wealth while not building their core business. So, um, there's one you can't blame on the unions; they actually knew better what made the business work in the first place.

Speaking generally, the usual reasons for business failure are:

-Inadequate funding
-Bad location
-Lack of a well thought-out business plan
-Poor execution
-Bad management
-Expanding too quickly
-Insufficient marketing or promotion
-Inability to adapt to a changing marketplace
-Failure to keep overhead costs low
-Underestimating competitors

Oh, yeah. Keep blaming unions.

[iheartthed]

When Borders was making money, they kept trying to gut the one thing people LIKED about them: That intelligent, well-read people were able to give expert advice to book-buyers. Instead, they cracked down whenever the work force tried to unionize, tried to turn them into low-paid "stockers" who knew nothing about books, and began an ill-fated expansion into CDs and DVDs [[remember them?). The whole while, they were using their profits to buy back stock and increase their personal wealth while not building their core business. So, um, there's one you can't blame on the unions; they actually knew better what made the business work in the first place.

Speaking generally, the usual reasons for business failure are:

-Inadequate funding
-Bad location
-Lack of a well thought-out business plan
-Poor execution
-Bad management
-Expanding too quickly
-Insufficient marketing or promotion
-Inability to adapt to a changing marketplace
-Failure to keep overhead costs low
-Underestimating competitors

Oh, yeah. Keep blaming unions.

Was/is Borders unionized?

[Detroitnerd]

Was/is Borders unionized?

Nope. They successfully blocked every effort of their workers to organize. I remember when the workers struck the Liberty Street store in Ann Arbor five years ago and had some long talks with them. They were warning the management even then.

[Redleg81]

Was/is Borders unionized?

To my knowledge, only the downtown Ann Arbor store was. Not sure if this is still the case, my fuzzy brain recalls a short-lived strike-- Maybe a few years back. Can anyone add more?

[iheartthed]

To my knowledge, only the downtown Ann Arbor store was. Not sure if this is still the case, my fuzzy brain recalls a short-lived strike-- Maybe a few years back. Can anyone add more?

Yeah, I do vaguely remember the strike now. I think I was still living in Ann Arbor at the time.

[mwilbert]

A high percentage of businesses everywhere go bankrupt. What I find unfortunate is the number of successful businesses which have been bought out and then hollowed out--all the banks [[except Comerica, which left all by itself), Hudsons, Motown, Cunningham's/Perry's, Stroh's. Not that that is unique to Detroit either.

[Hermod]

Speaking generally, the usual reasons for business failure are:

-Inadequate funding
-Bad location
-Lack of a well thought-out business plan
-Poor execution
-Bad management
-Expanding too quickly
-Insufficient marketing or promotion
-Inability to adapt to a changing marketplace
-Failure to keep overhead costs low
-Underestimating competitors

Oh, yeah. Keep blaming unions.

I think that we can blame both unions and management. The whole "Detroit model" for the auto companies, their suppliers, and the UAW was based on a monopoly/oligopoly practice. The unions demanded wage increases, management di a show of force to keep the demands from being too extreme, management factored the new wage agreements into their cost calculations, management figured the level of profit they needed [[after taxes since they considered taxes as a "cost"), and then set the price for the rest of America. The rest of America, being addicted to cars, went into debt to pay the price demanded by the Big 3/UAW. Detroit and the metro area swam in profitability.

Suddenly, a small cloud the size of a Volkswagen appeared on the horizon. Slowly European cars and later Japanese cars became available to the public and after getting hosed by Detroit, the rest of the country could now give Detroit the finger. The Big 3/UAW ignored the competition and steadily lost market share. Even though car sales are recovering, the Detroit area is still in the crapper.

[Zacha341]

Add to the list these three:

-Theft
-High taxation
-High insurance rates

Speaking generally, the usual reasons for business failure are:

-Inadequate funding
-Bad location
-Lack of a well thought-out business plan
-Poor execution
-Bad management
-Expanding too quickly
-Insufficient marketing or promotion
-Inability to adapt to a changing marketplace
-Failure to keep overhead costs low
-Underestimating competitors

Oh, yeah. Keep blaming unions.