The largest office supply chain in the United States has announced its intention to close 45 European locations and is speeding up plans to close 15 U.S. stores. These closings are part of Staples efforts to save around $250 million per year and may work into business formation plans for other companies.
Staples Inc. has posted declines in sales for two quarters as businesses move away from using traditional office supplies and do more work through new technology instead. Slow job creation and recession in Europe has also hit the company hard. Staples plans to use the savings to develop its online presence.
Several private-equity firms have considered buying Staples, but no concrete plans have been made. These companies see the giant as an easy acquisition of ready-made brand recognition and are willing to work with the company’s structure to make it more user-friendly and drive up sales.
When companies suffer from financial problems, it is not unusual for other companies to consider a buyout. A company can quickly obtain a large amount of capital, manpower, and value through an intelligent buyout. However, the buyer must be aware of the issues surrounding the company’s problems and be able to solve those problems quickly, or the buyout may pull the purchaser’s company down rather than adding to its growth.
A business attorney can be an integral part of a company’s buying strategy by providing legal advice and handling the contracts and documents necessary to effect a successful business buyout.
Source: Bloomberg News, “Staples to Shut 60 Stores in Plan to Save $250 Million,” Leslie Patton, Sept. 25, 2012