I Just Heard A Confirmation Of What I've Been Thinking

[jjamie12]

They knew KB Toys was doomed from the get go... They cannibalized them. Remember the video a while back... The kid with the backpack? He was getting beat, dazed and confused... Yet, it looked like someone was trying win his trust and help him... Only thing was that person's accomplice was robbing him... Stealing out of the backpack.

 

That's Bain Capital in a nutshell. The ends don't justify the means.

 

And this is the guy, RomneyMussolini, we want keeping the trains on time?... No thanks, I will walk and be late!

You, simply, don't know what you're talking about. I wish you'd educate yourself about this in a manner other than in 30 second soundbites.

 

How much money did they make? Was it a case of vulture capitalism like Romney engages in?

With all due respect, you just have no idea what you're talking about. I wish you'd educate yourself about this in a manner other than 30 second soundbites.

[tomato can]

That's just plain wrong. KB's stores were not much larger than a two car garage? Rent per s/f is figured monthly? Ha! Rent in a mall is about $10 a s/f? This is a subject that you shouldn't have commented on.

 

In addition, what makes you think GE Capital is going to "through" them a lifeline because they felt sorry for them because they were in such bad shape? Then GE is going to change the terms shortly thereafter so it puts KB out of business, thus making their note virtually worthless?

 

It is obvious you don't know what you are talking about. It's also possible that you just posted drunk as hell to come up with schit like this.

 

 

How is it wrong? I worked for a mall management company for 18 years. I have direct knowledge of how thing work. KB Toys were small stores in regional shopping malls. They weren't leasing 10,000 sq foot stores. Not every store in malls pay the $38 per square foot rate. Not every mall is owned by Simon Property Group, Westfield, or General Growth Properties. For your information there are regional malls that are privately owned. So yes at times they lacked leverage to command that high rent. They also lack leverage to fill up their malls with all National retailers. They often times deal with higher vacancies than the big guys. So yes it is a fact that the real estate people for those national retailers will use that as leverage and get much lesser price per square foot. Water Tower Place in downtown Chicago can command high rent because of the high volume of traffic that they have. Retailers are willing to pay that high rent at Water Tower Place because the potential for high volume of sales is there based on that malls traffic numbers. Not every mall in the Chicagoland area has Water Tower Place traffic numbers. Remember this also KB toys did okay throughout the course of the year but they were not capable of generating the numbers of sales that a Mens Footlocker is capable of month to month. That is why KB would negotiate for cheaper rent and the landlord would counter with a breakpoint on sales knowing that KB would do extremely well come Holiday season. I have brought facts to the table. You have only countered with a bunch of gibberish & like a prepubulent child make the claim I was drunk posting

 

 

This was a few years ago but I do remember reading a statement by KB that they would not be able to meet the news terms set by GE and the only option left for them was a complete liquidation. I am assuming that GE was able to re-coup some of their money from the liquidation.

Edited July 3, 2012 by tomato can

[tomato can]

I said conceive...as in...understand that there's more than one way to think of this, not concede. It does not matter what we know: the only thing that matters is Bain assessed the client, and took their shot accordingly. That's business. Somebody had to agree to the sale of KB = stockholders. If they made a bad call, that's on them, not Bain. You're upset because somebody did a 6% cash LBO...as though that doesn't happen, for a lot less, every day? Grow up.

 

Yes Bain assessed the client, took their shot, that's business. I will counter with paying TAXES is part of doing business. Yet I see a lot of conservatives cry a river of tears about having to pay taxes! Remember "that's business"

 

Upset? Not really. I didn't lose anything. Sad? Yeah sure. Sad to see good hard working Americans lose a job. Sad to see good people that I was able to interact with while working for the mall management company lose a job. Sad to see the college kid struggling to keep his head above water, work & go to school lose his job. Sad to see the high school teenager lose his or her part time job.

 

 

Let's see...should we believe you....or industry analysts?

 

"KB was for many years in a precarious position because of where it was in the industry. It wasn't able to compete on price," said Sean McGowan a senior leisure and lifestyle analyst for Needham & Co. "... If you layer on financial strain, that could push it to the breaking point."

"Their business model was obsolete," he said. "The world had changed. KB had not changed."

 

Small mall toy stores, such as KB's, couldn't carry enough inventory — or stay tidy. But mall rents were high, and leases long, limiting KB's ability to shift to compete with its larger rivals. Meanwhile, Target, Walmart and Toys "R" Us could carry far more toys and heavily discount the hottest merchandise.

"Knowing all these facts, why is the consumer going to go in there? Is it the higher prices or the old toys?" Silver said. :lol:

 

What about Bain's role? "To me, it's almost irrelevant," Silver said. "You take a business model that doesn't work, it doesn't matter how much money you have, or how much debt you have."

 

You have been defeated...by Politifact. Yes, that rating says "mostly false". Thanks for playing. Now, if you want to start laying money on stuff like this, please, come back any time. Dude you are new here, so I'll just tell you: I had this link 2 posts ago. I just wanted to see how you'd go about FAILing. The good news is: you proved you can think for yourself, and I appreciate you actually putting in the effort. So, that's something. At least you didn't respond by pasting in something tenuously related from wiki....

 

 

You are giving me an industry analysts opinion after Bain cannibalized this company I see the article was written more or less to defend Mitt's role at Bain. I am sure there are opinions out there that would say the opposite.....Since I am new here and proved I can think for myself I will go one step further. I will give you facts rather someones after the fact opinion! Below is a few quotes from an article that is dealing with facts about KB.

 

"In 1996, after an aborted attempt in 1995 to spin off Kay-Bee Toys, the Melville Corporation decided to sell the chain of 1,045 stores to Consolidated Stores Corporation for about $300 million. Consolidated already operated Toys Liquidators, Toys Unlimited, and the Amazing Toy Store close-out stores, as well as general retailers Odd Lots, Big Lots, All for One, and the It's Really $1.00 stores. William Kelley, chief executive officer and chairman of Consolidated's board, said in a New York Times article that he expected the combined businesses to offer 'a great deal of synergy.' Kay-Bee, under the direction of president Michael Glazer, continued to be run as a separate business within Consolidated's new Toy Division despite talk of its merging with their Toy Liquidators chain. Immediately after the sale, the stock of Consolidated surged upward. Kay-Bee provided a 50 percent return on Consolidated's investment in its first nine months of new ownership. In 1997, Kay-Bee's sales boosted Consolidated's revenue by about 70% "

 

Glazer, quoted in Discount Stores News in July 1997, attributed the chain's outstanding performance to closing underperforming stores and writing off lots of obsolete inventory prior to the sale to Consolidated. Consolidated also established a specific identity for the 1,200 stores and brushed up the chain's image with a new logo, KB. It integrated Kay-Bee with its core close-out business, and was boosting the chain's higher-margin close-out items from 25 to about 30 percent of its business.

 

It seemed nothing could stop KB Toys from challenging its rivals in the toy industry. Operating profit for 1999 was up 51 percent from 1998. The company, seeking to capitalize on its growth, decided to hold an initial public offering in the spring of 2000, then postponed trading due to unfavorable market conditions. Notwithstanding this delay, KB was more focused than ever on fine-tuning its position in the very fashion-forward toy industry. With relatively small stores and a knack for innovation and creativity in marketing, KB was ready as ever to make quick adjustments to changing customer and merchandise trends.

 

This information was from this piece, http://www.fundinguniverse.com/company-histories/kb-toys-history/ . Those happen to be facts, not some ding a ling's ( or industry analysts) opinion

 

 

 

 

Edit: Why didn't the execs at KB do right by their stockholders, and, as soon as it became clear that Toys R Us and Walmart weren't going away, and that they were in trouble, SELL their company to one of them? That's what I would have done. That's what gets you the next job as a CEO...because you have proven that you know the game, and play it properly.

 

This simply factually incorrect. It's a lie. See Politifact. Well, not a total lie, just "mostly false".

 

The only question that remains: will you continue to believe the mostly false? Or, will you wise up?

 

 

KB was sold to Bain for fair market value. KB didn't do their stockholders wrong, Bain did when they saddled it with enormous debt and sent it into bankruptcy. Politifact piece you sited is an opinion, which I don't really agree with! One other fact to note. Bain was sued by the creditors and very quietly settled with them, not disclosing the terms. If it was just business and everything they did was on the up & up, why settle?

 

The questions remain : will you sir continue to rely on shoddy opinions or as my favorite journalist Bill O'reilly would say will you "wise up"

Edited July 3, 2012 by tomato can

[3rdnlng]

How is it wrong? I worked for a mall management company for 18 years. I have direct knowledge of how thing work. KB Toys were small stores in regional shopping malls. They weren't leasing 10,000 sq foot stores. Not every store in malls pay the $38 per square foot rate. Not every mall is owned by Simon Property Group, Westfield, or General Growth Properties. For your information there are regional malls that are privately owned. So yes at times they lacked leverage to command that high rent. They also lack leverage to fill up their malls with all National retailers. They often times deal with higher vacancies than the big guys. So yes it is a fact that the real estate people for those national retailers will use that as leverage and get much lesser price per square foot. Water Tower Place in downtown Chicago can command high rent because of the high volume of traffic that they have. Retailers are willing to pay that high rent at Water Tower Place because the potential for high volume of sales is there based on that malls traffic numbers. Not every mall in the Chicagoland area has Water Tower Place traffic numbers. Remember this also KB toys did okay throughout the course of the year but they were not capable of generating the numbers of sales that a Mens Footlocker is capable of month to month. That is why KB would negotiate for cheaper rent and the landlord would counter with a breakpoint on sales knowing that KB would do extremely well come Holiday season. I have brought facts to the table. You have only countered with a bunch of gibberish & like a prepubulent child make the claim I was drunk posting

 

 

This was a few years ago but I do remember reading a statement by KB that they would not be able to meet the news terms set by GE and the only option left for them was a complete liquidation. I am assuming that GE was able to re-coup some of their money from the liquidation.

 

Again, you stated that KB stores were only about 700 s/f and that the price per s/f is figured on a monthly basis. Is that still your contention?

[tomato can]

Again, you stated that KB stores were only about 700 s/f and that the price per s/f is figured on a monthly basis. Is that still your contention?

 

 

I was responding to the comment tiny mall stores................which my reply was small stores like KB can usually be around 700 sq feet. Did they have stores that were 1,000 sq feet, 1,500 sq feet. I am sure they did and I am sure those malls that they had larger stores in had high volume of traffic. Yes that is my contention.

[ExiledInIllinois]

Mitt flip-flops... What is it with these MA flip-flops!

 

A few years back... What is good for MA is good for the nation... Now it isn't.

 

Hey Mitt... Kerry wants his flip-flops back!

[3rdnlng]

I was responding to the comment tiny mall stores................which my reply was small stores like KB can usually be around 700 sq feet. Did they have stores that were 1,000 sq feet, 1,500 sq feet. I am sure they did and I am sure those malls that they had larger stores in had high volume of traffic. Yes that is my contention.

 

How is price per s/f figured? Are you talking real indoor malls or a neighborhood strip mall when you talk $10 s/f? Is that a gross lease or NNN?

[tomato can]

How is price per s/f figured? Are you talking real indoor malls or a neighborhood strip mall when you talk $10 s/f? Is that a gross lease or NNN?

 

 

Depends on which formula the landlord uses, there a quit a few of them they can use to calculate s/f. Yes a real indoor mall. Base rent.

[3rdnlng]

Depends on which formula the landlord uses, there a quit a few of them they can use to calculate s/f. Yes a real indoor mall. Base rent.

 

What is the accepted industry wide practice for figuring price per s/f?

[tomato can]

What is the accepted industry wide practice for figuring price per s/f?

 

 

 

It can vary by location. I would suggest you look it up!

Edited July 3, 2012 by tomato can

[3rdnlng]

It can vary by location. I would suggest you look it up!

 

 

I don't need to, I already know. Regardless, is that your final answer?

 

I see you've avoided answering other questions too. There are certain things that are just very basic in the field and if you misstate them it's obvious you don't know what you are talking about.

[OCinBuffalo]

Yes Bain assessed the client, took their shot, that's business. I will counter with paying TAXES is part of doing business. Yet I see a lot of conservatives cry a river of tears about having to pay taxes! Remember "that's business"

So what? Are you like the woman...who wants me...to want to do dishes? Why would I...want...to do dishes? Ugh, I haven't even read all of this, and I can already smell: "womanly". I hope this isn't going to be one emotional argument/idiotic rationalization after the next. We'll see....

Upset? Not really. I didn't lose anything. Sad? Yeah sure. Sad to see good hard working Americans lose a job. Sad to see good people that I was able to interact with while working for the mall management company lose a job. Sad to see the college kid struggling to keep his head above water, work & go to school lose his job. Sad to see the high school teenager lose his or her part time job.

Emotional Argument #1: "What about the jobs!" Dude, seriously? Toys R Us and Walmart were always going to destroy your friends'(yeah no emotion here at all) company. Those jobs were going away no matter what. What's better, for those people to lose those jobs, now, and get started somewhere else? Or stay, and waste time that they won't get credit for at the next job?

 

And, btw, it must have sucked for you to lose a customer at your job....but you are being objective here, right?

You are giving me an industry analysts opinion after Bain cannibalized this company I see the article was written more or less to defend Mitt's role at Bain. I am sure there are opinions out there that would say the opposite.....Since I am new here and proved I can think for myself I will go one step further. I will give you facts rather someones after the fact opinion! Below is a few quotes from an article that is dealing with facts about KB.

I am giving you the opinion of experts. You are choosing to argue with them.

 

The article, as all Politifact articles are, was written to examine the Obama campaign's claims and objectively determine their veracity. Yes, there are opinions that would say the opposite: they work for the Obama campaign.

 

Go ahead and look at the Washington Post(yeah, a real conservative bastion )'s fact checker here. 4 pinnochios and no opinions, only facts. Yeah, I had this article 3 posts ago as well. Let's see what else you have to say....

"In 1996, after an aborted attempt in 1995 to spin off Kay-Bee Toys, the Melville Corporation decided to sell the chain of 1,045 stores to Consolidated Stores Corporation for about $300 million. Consolidated already operated Toys Liquidators, Toys Unlimited, and the Amazing Toy Store close-out stores, as well as general retailers Odd Lots, Big Lots, All for One, and the It's Really $1.00 stores. William Kelley, chief executive officer and chairman of Consolidated's board, said in a New York Times article that he expected the combined businesses to offer 'a great deal of synergy.' Kay-Bee, under the direction of president Michael Glazer, continued to be run as a separate business within Consolidated's new Toy Division despite talk of its merging with their Toy Liquidators chain. Immediately after the sale, the stock of Consolidated surged upward. Kay-Bee provided a 50 percent return on Consolidated's investment in its first nine months of new ownership. In 1997, Kay-Bee's sales boosted Consolidated's revenue by about 70% "

 

Glazer, quoted in Discount Stores News in July 1997, attributed the chain's outstanding performance to closing underperforming stores and writing off lots of obsolete inventory prior to the sale to Consolidated. Consolidated also established a specific identity for the 1,200 stores and brushed up the chain's image with a new logo, KB. It integrated Kay-Bee with its core close-out business, and was boosting the chain's higher-margin close-out items from 25 to about 30 percent of its business.

 

It seemed nothing could stop KB Toys from challenging its rivals in the toy industry. Operating profit for 1999 was up 51 percent from 1998. The company, seeking to capitalize on its growth, decided to hold an initial public offering in the spring of 2000, then postponed trading due to unfavorable market conditions. Notwithstanding this delay, KB was more focused than ever on fine-tuning its position in the very fashion-forward toy industry. With relatively small stores and a knack for innovation and creativity in marketing, KB was ready as ever to make quick adjustments to changing customer and merchandise trends.

Emotional argument #2:

You are talking about cannibalizing....but posting about KB making a 'profit', by closing stores and writing off assets? Really? KB cannibalized it's own assets so that it could appear more profitable to its buyers....and you don't see anything wrong with that? I don't see how this = "performance". The business model was sooo great...that it put **** inventory on your books that is so bad, that it needs to be written off, not sold on a secondary market? How many Walmarts can be classified as "underperforming"? In fat how many Wal Marts have been closed....that weren't replaced by bigger, "shock and awe" Walmarts?

 

"Nothing could stop KB Toys from challenging"...Walmart, Target, Toys R Us? Yeah, I suppose nothing can stop a drunken idiot from challenging a bouncer...but that challenge does what exactly?

 

Dude, all you have to know is that sentence, right there, to know that this author is nowhere near objective. Ridiculous.

This information was from this piece, http://www.fundingun...b-toys-history/ . Those happen to be facts, not some ding a ling's ( or industry analysts) opinion

Yeah, you should do better internet research. Lendio is who this is. It has this nice little quote here, right on their website "President Obama, don't worry, we're here to help you out!" Which is link to a Huffington Post article?

 

Real objective. They list their people...by first name...with no experience history?

 

Dude, I talk to people like this as part of my job. They aren't toy industry analysts. Not even close. What they are: a loosely organized group of people that analyze companies like mine...and try to sell us financing....for an exploitative fee. They float around looking for whatever is "hot", they may have 1 guy who worked in toys for a few years...maybe. Oh sure, they get you the loan for free...but don't tell you that their fee is built into the rate, and that you have to put up crazy equity in your firm as collateral. They are a loan re-seller for banks, looking to take over your company at the slightest hint of trouble.

 

Hence, from the website "FundingUniverse.com has had a small amount of unhappy customers and some unwanted complaints." and, "If the business owner isn't a good fit for any financing, or doesn't like their options, then Lendio helps them, over time, fix what's wrong. Lendio provides a valuable and needed service."

 

By that logic, so does Bain Capital.

 

Based on your version of "morality", these people are <= Bain, because at least Bain tells you who they really are. But most importantly, these guys will NEVER publicly bag on any company. That is counter productive for them. Everything is roses, because their sales pitch is based on "most businesses can get funded, if only you trust in us, and we say everything is positive, and we can do better...now sign here please." So, you cannot use these guys for objective analysis of KB. Sorry.

 

But, remember, I have no problem with Lendio. This is the job they do. And, some companies are desperate enough to work with people like this. That's on them.

KB was sold to Bain for fair market value. KB didn't do their stockholders wrong, Bain did when they saddled it with enormous debt and sent it into bankruptcy. Politifact piece you sited is an opinion, which I don't really agree with! One other fact to note. Bain was sued by the creditors and very quietly settled with them, not disclosing the terms. If it was just business and everything they did was on the up & up, why settle?

 

The questions remain : will you sir continue to rely on shoddy opinions or as my favorite journalist Bill O'reilly would say will you "wise up"

Politifact is, by definition, fact. The whole point of it, or the WashPo fact checker, is to measure the truth in what politicians say. Go ahead and google all of these type of websites, and see for yourself. This info comes from the Obama campaign video, and it is now proven BS. I am done doing proper internet research for you. You are a grown up.

 

So what if Bain got sued? They still got what they wanted. They still did the job they were hired to do, and somebody signed their contract.

 

And most importantly? Romney was in Salt Lake City fixing the Olympics when all of your friends lost their jobs. I have been saying "wise up" since my JV coach said it. So spare me the O'Reilly stuff.

[DC Tom]

Point of note: KB Toys liquidated under the ownership of Prentice Capital Management, not Bain.

[jjamie12]

Point of note: KB Toys liquidated under the ownership of Prentice Capital Management, not Bain.

So you're saying that we're arguing about the specifics of something that didn't even happen?

 

I really can't wait for this campaign to be over.

[3rdnlng]

So you're saying that we're arguing about the specifics of something that didn't even happen?

 

I really can't wait for this campaign to be over.

 

Actually Bain sold it to Prentice in 2006. It was healthy enough to get a 200 million dollar loan from GE Captital in 2007 but in the Autumn of 2008 their sales dropped 20% over the previous year. They filed for bankruptcy late in 2008. The kicker here is that Romney wasn't with the firm when Bain bought it or at any time when Bain owned it. This is a prime example though of Romney's "Vulture Capitalism".

[DC Tom]

Actually Bain sold it to Prentice in 2006. It was healthy enough to get a 200 million dollar loan from GE Captital in 2007 but in the Autumn of 2008 their sales dropped 20% over the previous year. They filed for bankruptcy late in 2008. The kicker here is that Romney wasn't with the firm when Bain bought it or at any time when Bain owned it. This is a prime example though of Romney's "Vulture Capitalism".

 

With the caveat that "healthy enough to get a loan from GE Capital" is like saying "enough income to get a subprime mortgage from Countrywide."

[/dev/null]

Obama made the cars run off the production lines in Detroit, which they wouldn't be doing if Willard had his way and there were no loans to GM or Chrysler.

 

Obama's did one helluva job saving GM

http://news.investors.com/article/616849/201207030826/gm-bailout-taxpayer-loss-rises-as-shares-fall.htm

(I love how the author tossed in the quote from Lando Calrisian )

Edited July 3, 2012 by /dev/null

[3rdnlng]

With the caveat that "healthy enough to get a loan from GE Capital" is like saying "enough income to get a subprime mortgage from Countrywide."

 

I'm sure they needed more than "stated income" to get the loan. 200 million is 200 million. Their sales took a big dive when all the economic schit hit the fan in the summer and fall of '08 and they were perfectly positioned to take the brunt of the buying public's wariness to spend.

[Doc]

Obama's did one helluva job saving GM

http://news.investors.com/article/616849/201207030826/gm-bailout-taxpayer-loss-rises-as-shares-fall.htm

(I love how the author tossed in the quote from Lando Calrisian )

Darth Obama: "Pray I don't alter it any further."

[DC Tom]

Obama's did one helluva job saving GM

http://news.investors.com/article/616849/201207030826/gm-bailout-taxpayer-loss-rises-as-shares-fall.htm

(I love how the author tossed in the quote from Lando Calrisian )

 

They could just have easily gone with "They told me they fixed it!"