ASR going Bankrupt? Buy your Personna's now!

[DonOhio]

http://brands.kraftfoods.com/claussen

Funny, they don't look bankrupt.

Dropping products without warning or explanation is one thing; happens all the time at all stores, and ticks me off, too. That's not the same as a retailer (allegedly) killing a supplier.

 

[DavyRay]

DonOhio,

I will play Sherlock Holmes and deduce a few things about you, based on this thread alone.

1. You do not raise chickens for Tyson Foods.
2. You are not a dairy farmer.

Please do not be insulted if I think you are not in these businesses.
Those guys know what it is like to have a very large customer offer a contract which requires large capital investment, sells them 80% to 100% of your products, and will make you a decent profit, for the first year. Second year, not so good. Your capital is invested in your production facilities. By year three, it is not all amortized, and the year three contract is worse yet. If your new customer only gets five years of cheap product before you go bankrupt, that's okay. They are already lining up another producer, offering them money you have not seen for years.

If I did not think you were a reasonable man, I would not have bothered typing all this. I do not think Wal Mart will bring in Dorco, unless they can entice Dorco to invest in expanded production for Wal Mart.

 

[DonOhio]

DonOhio,

I will play Sherlock Holmes and deduce a few things about you, based on this thread alone.

1. You do not raise chickens for Tyson Foods.
2. You are not a dairy farmer.

Please do not be insulted if I think you are not in these businesses.
Those guys know what it is like to have a very large customer offer a contract which requires large capital investment, sells them 80% to 100% of your products, and will make you a decent profit, for the first year. Second year, not so good. Your capital is invested in your production facilities. By year three, it is not all amortized, and the year three contract is worse yet. If your new customer only gets five years of cheap product before you go bankrupt, that's okay. They are already lining up another producer, offering them money you have not seen for years.

If I did not think you were a reasonable man, I would not have bothered typing all this. I do not think Wal Mart will bring in Dorco, unless they can entice Dorco to invest in expanded production for Wal Mart.

I'm not insulted at all.

The closest thing I can find to what you guys are talking about is reference to WM's "Plus One" policy, from an '03 L.A. Times article.

[FONT=arial, helvetica, sans-serif]In apparel, the process begins with Celia Clancy. From a renovated warehouse near the company's headquarters, the Wal-Mart executive vice president oversees the world's largest clothing budget, estimated at $35 billion in 2000.
[/FONT]
[FONT=arial, helvetica, sans-serif]Clancy gives her buyers a "Plus One" mandate every year: For each item they handle, they must either lower the cost or raise the quality. [/FONT]

http://seattletimes.nwsource.com/html/businesstechnology/2001802659_walmart280.html

Does WM still do this? Probably. Is WM the only retailer who does this? Don't know - I'd be curious to find out. But the others have to stay competitive, and long since started to play WM's game WM's way in other areas.

Still, I can find no names of otherwise healthy companies that DIED solely for refusing to comply with Plus One. If that had happened, PBS would definitely have trumpeted it. They didn't.

Still willing to be convinced, though.

 

[sandmountainslim]

No offense gentlemen but Wal-Mart chat has stolen the thunder in this thread.

May we get back to Personna news?
Wp

 

[Monkeydad]

It's no secret that Wal-Mart is a business killer. They set costs and retail for a company's product, or they won't carry that company's product. That's fact. And many times, the time comes when the company simply can not make a profit at the Wal-Mart-defined price points. The company is left with no choice but to go up. Wal-Mart doesn't like this and kicks the company out of their stores. It is fact that if you want your product in the Wal-Mart supply chain, you have to play by Wal-Mart's rules, including costs to Wal-Mart of your product and what Wal-Mart wants it sold to the public for. This has, and will continue, to kill many businesses. The only way many of these companies have dealt with this is to produce 2 different versions of the same product: The one at Wal-Mart made from less quality (aka cheaper) materials and parts and the one sold elsewhere with the original quality materials and parts. This is the only way even some of the big companies can survive having their products offered for sale at Wal-Mart.

I often shop at my local, family-owned hardware store in town...where I'd have to drive 5 miles to the malls and "big" stores. This place is only one mile from home and great when I'm working on a project and need something to complete it. Customer service is great there.

But guess what, I pay a lot more for anything there. They have bags of soil for $10. (which I don't buy anymore, I go to another locally-owned "garden center" and get them for $2 each and they're twice the weight).

Anyways, back to the hardware store...every item costs a bit more than what I could buy at a "big box store". Sometimes I'll go the extra 8 miles round trip to save money if it's a bigger purchase. This local hardware store charges a lot more for everything, but their location, convenience and probably partially their customer service level keep them alive.


BUT...could I call them a "predator" because they're hiking up prices on everything, from screws to paint?

This whole "I hate Walmart and they're evil" shtick is laughable and often hypocritical.

They're a successful business made successful by their customers who go there by choice. If a Walmart opens up in any town, they don't "put small shops out of business" simply by purchasing a plot of land and paving it. The customers who CHOOSE Walmart over the other shops for any reason...price, location, service, etc. are putting the small businesses out. If they really believed the "Walmart is evil, boycott them" lines they shout, the Walmart could not survive and the small businesses would continue as usual. The CUSTOMERS decide the fates of both the small and large businesses.

If anyone is going to attack Walmarts for being successful and profitable, they need to be honest and also criticize EVERY business for doing the same...because that is the real intention of any business owner, to make money. The large corporations want to profit just as much as the small business owner. They may personalize their service more, but when it comes down to it, they want your money too. The large business will take a calculated risk and buy inventory in bulk, hoping to be able to sell all of it. The small business will put items out at a higher price, hoping you'll want to buy it. They both have the exact same goal, they just go about it in different methods.

 

[spinyeel]

I often shop at my local, family-owned hardware store in town...where I'd have to drive 5 miles to the malls and "big" stores. This place is only one mile from home and great when I'm working on a project and need something to complete it. Customer service is great there.

But guess what, I pay a lot more for anything there. They have bags of soil for $10. (which I don't buy anymore, I go to another locally-owned "garden center" and get them for $2 each and they're twice the weight).

Anyways, back to the hardware store...every item costs a bit more than what I could buy at a "big box store". Sometimes I'll go the extra 8 miles round trip to save money if it's a bigger purchase. This local hardware store charges a lot more for everything, but their location, convenience and probably partially their customer service level keep them alive. No offence,but it's people that think like you do that have caused family businesses to be swallowed up by the multi national corporations,in their insatiable quest to maximise profits and keep greedy shareholders happy.


BUT...could I call them a "predator" because they're hiking up prices on everything, from screws to paint?

This whole "I hate Walmart and they're evil" shtick is laughable and often hypocritical.

They're a successful business made successful by their customers who go there by choice. If a Walmart opens up in any town, they don't "put small shops out of business" simply by purchasing a plot of land and paving it. The customers who CHOOSE Walmart over the other shops for any reason...price, location, service, etc. are putting the small businesses out. If they really believed the "Walmart is evil, boycott them" lines they shout, the Walmart could not survive and the small businesses would continue as usual. The CUSTOMERS decide the fates of both the small and large businesses.

If anyone is going to attack Walmarts for being successful and profitable, they need to be honest and also criticize EVERY business for doing the same...because that is the real intention of any business owner, to make money. The large corporations want to profit just as much as the small business owner. They may personalize their service more, but when it comes down to it, they want your money too. The large business will take a calculated risk and buy inventory in bulk, hoping to be able to sell all of it. The small business will put items out at a higher price, hoping you'll want to buy it. They both have the exact same goal, they just go about it in different methods.

Where did the term Capitalist pig originate?

 

[GentsInstinct]

Here's one hoping ASR can get it together and not close up shop. Competition is always good and I can't recall the last time Gillette or Schick made any good double edge, single edge or injector blades. Last time those 2 companies did so, I don't think I was born yet. So that means they aren't suddenly going to start making them to fill the void that ASR left, should ASR shut down.

 

[Barbash]

Here's one hoping ASR can get it together and not close up shop. Competition is always good and I can't recall the last time Gillette or Schick made any good double edge, single edge or injector blades. Last time those 2 companies did so, I don't think I was born yet. So that means they aren't suddenly going to start making them to fill the void that ASR left, should ASR shut down.

I also hope ASR is able to rebound, but I disagree that Gillette doesn't make good DE blades. Their 7 O'Clock Yellows are my go to blade.

 

[awesomefunn]

i think they make my astras too.. dang gillette

 

[GentsInstinct]

i think they make my astras too.. dang gillette

Yes, they are made in Russia under the Procter & Gamble name.

 

[SUNA]

I understand most points...but have to chuckle a bit. Welcome to capitalism guys. If you can't handle WM pursuing economies of scale thereby marginalizing smaller outfits...move to soc1al1st Cuba.

Capitalism > Soc1al1sm, and unions are for the weak. Flame away...but it's true!

 

[Dewaine]

I understand most points...but have to chuckle a bit. Welcome to capitalism guys. If you can't handle WM pursuing economies of scale thereby marginalizing smaller outfits...move to soc1al1st Cuba.

Capitalism > Soc1al1sm, and unions are for the weak. Flame away...but it's true!

Agreed! However, it should not be forgotten, that with greater size (such as Wal-Mart's) comes greater capacity to pursue political means to beat the competition. This should not be the case, but we (in the US) live with the largest, most powerful government ever to exist. Your statement above is 100% correct with regard to actually free (as opposed to theoretically free) economies.

 

[Haiku]

I understand most points...but have to chuckle a bit. Welcome to capitalism guys. If you can't handle WM pursuing economies of scale thereby marginalizing smaller outfits...move to soc1al1st Cuba.

Capitalism > Soc1al1sm, and unions are for the weak. Flame away...but it's true!

I would prefer to discuss blades and not political economy, and I don't want to get involved in a debate about so......m and capitalism, but the only reason that outfits like WM have become what they've become is that the United States and Canada for that matter have pursued a "global" economy which permits WM and others to buy stuff from China.

And so the whole problem with WM is not a so......m/capitalism debate, it's a question of whether governments pursue policies that require "buy at home" or whether they pursue global economic policies that permits global corporations to buy in China and sell in the United States.

There's a reason that much manufacturing has moved out of the United States and relocated to communist countries or former communist countries and that is solely because of the economic policies pursued by the government of the United States. And that has nothing whatsoever to do with communism so......m capitalism unions being for the weak or anything of the like.

WM will buy from China and not buy from American companies because it's cheaper to do so, and it's cheaper to do so because China is a communist dictatorship.

 

[SUNA]

I would prefer to discuss blades and not political economy, and I don't want to get involved in a debate about so......m and capitalism, but the only reason that outfits like WM have become what they've become is that the United States and Canada for that matter have pursued a "global" economy which permits WM and others to buy stuff from China.

And so the whole problem with WM is not a so......m/capitalism debate, it's a question of whether governments pursue policies that require "buy at home" or whether they pursue global economic policies that permits global corporations to buy in China and sell in the United States.

There's a reason that much manufacturing has moved out of the United States and relocated to communist countries or former communist countries and that is solely because of the economic policies pursued by the government of the United States. And that has nothing whatsoever to do with communism so......m capitalism unions being for the weak or anything of the like.

WM will buy from China and not buy from American companies because it's cheaper to do so, and it's cheaper to do so because China is a communist dictatorship.

Plain and simple...it's a world economy now. People complain about outsourcing, over seas purchasing, etc. If us North American people don't like it...then we can work those jobs for the same pay as in Asia! The problem with us North Americans is that we think our time is worth more than others in India/Asia. Outsourcing or buying from foreign countries is prevelant because us North Americans are all greedy pr*cks in our own lives. I won't work for $1 an hour...but someone else in the world will. So the business gets sent there. It's simple math. I'll happily let them make $1 an hour...because I sure as heck won't work for that wage! Again, welcome to capitalism and world wide economies.

 

[pras]

Hate to play the lawyer, but I will for what it's worth. They are not yet in bankruptcy. They have missed a scheduled payment on a secured loan, thus the the reference to the waiver of the covenant. If they do go bankrupt a variety of things can happen (this list is not exhaustive):

1. Go for a total liquidation in Chapter 7. Their assets get taken over by a trustee in bankruptcy, who marshals the assets and debts. Assets are organized by priority of claim, and assets liquidated to pay the creditors in order of priority.

2. Chapter 11-Reorganize the company, defer the debts, lower interest rates, renegotiate the underlying financial instruments, and it comes out a leaner, meaner company, usually smaller.

It seems as if this was a highly leveraged buyout with a huge purchase price of $625 million. UBS does not want to take a bath, as a total liquidation would result in them sustaining a huge loss. Better to renegotiate, and keep them in business, and move the debt forward a few years so as not to take a huge loss now.

There are a huge number of possibilities, but I am betting that ASR will stay in business, albeit as a leaner and meaner company, with a tight focus on its most profitable businesses.

Great post! My Bankruptcy professor would be proud!

The recent Reuters article said that a bankruptcy would only effect America divisions. I don't know what this means for the Israeli factory.

Anyone have some insight into this?

 

[thanks]

The last few pages have derailed the topic so badly, that there could have been two separate threads made already. I'll bite my tongue, and reserve my strong disagreements with a lot of posts in here, to try and get the topic back on track.

With the latest article stating ASR will be getting an extension, is it possible for them to make good on their debts? If not, do we even know that their blade manufacturing will cease? One of the articles I believe, mentioned that their blade business was actually quite profitable. In such a case, that seems enticing for a company looking to buy them up.

 

[Pioneer]

Seems like a sad end to an early American monopoly. While we speak of Walmart (& I don't like it either) remember ASR was THE monopoly against Gillette. When Gem, Star, and Ever-Ready merged in 1919 the company's net worth was 20 million dollars. Tenty MILLION dollars. In 1919. George Storm, famous for his role in tobacco nonetheless, was assigned as the company's chair. Now here's a bit of interesting news: At that time, according to Storm's reports, in 1918 America manufactured 10 million razors. Ten MILLION razors in 1918. Even if ASR - the forerunner of today's large monopolies - goes under, this gives me hope that I'll be able to find some of those razors!

 

[cvixx]

Well, where I live there are no $ stores that sell blades so I have to go to WM. My last trip found my Trac-2 blades GOA and replaced by a composite T-2/Atra blade, at a higher cost of course. I found the shave to be horrible!!! Guess I will have to wait for the next trip to a PX...BTW, anyone using a PX/BX who will tell me what is being carried now?

My personal gripe about WM is their influence in bringing all the Chinese junk to the states. You know, all the toxic toys, chairs that break, etc. I know other chains do it soo but i was WM that started it. Plus WM seems to be constantly caught hiring illegals, another pet peeve of mine.

 

[rodeo]

My personal gripe about WM is their influence in bringing all the Chinese junk to the states. You know, all the toxic toys, chairs that break, etc. I know other chains do it soo but i was WM that started it.

You are a bit naive to think this is Walmarts fault as there is little in the way of items you can pick upin this country that isn't imported from China. Everything from fishing poles to you name it. Even one of the manufacturing companies I used to work for started going to China for it's raw stainless steel castings by the ship container load. It's a big problem in my eyes but the stuff is just so darn inexpensive. I hope sombody is genuinely keeping an eye on trade balance somewhere..

Now, I do think and agree with others here that the thread should rightfully be returned to the topic of ASR going bankrupt. That act can take a long long time to realize though so I wouldn't run out and hoard blades just yet.

 

[magnadoodle]

It looks official. American Safety Razor company files for Chapter 11.
http://retail.ocregister.com/2010/07/28/razor-manufacturer-sold-at-walmart-home-depot-files-for-bankruptcy/31437/