We take a look at some of the best business comebacks of all-time. At one point, all of these companies were written off and expected to go out of business.
You can’t write a feature on business comebacks without starting with Apple. When it comes to corporate turnaround stories, there may be none more famous than Apple’s. While the company is now one of the most valuable in the world, there was a time when Apple nearly went bust. When the company fired founder Steve Jobs in 1985, the downfall that followed was astronomical. Sales fell, which was largely influenced by the products they were offering such as Macintosh TV, and at one point the media was writing the company’s eulogy as it was losing more than $1 billion every year. However, the company’s revival started when Jobs returned after his start-up NeXT was purchased by Apple in 1996. The following year he became the company’s interim CEO, after Gil Amelio was ousted by the board of directors. Jobs would go on to take up the role permanently for more than 20 years. He subsequently took control of the management team and instilled a new corporate philosophy of recognisable products and simple design, starting with the original iMac in 1998. The rest is history!
Starbucks is easily the most recognisable coffee brand in the world. But like every other company on this list, Starbucks went through a very sticky period. The 2008 economic crisis hit Starbucks harder than most multi-national companies, and they were forced to close roughly 900 stores as a result. The situation was so bad that the stock price was cut in half and things within the company had spiralled out of control, so much so, that in 2008 former CEO Howard Schultz was forced to return to the company to set things straight after eight years being away. The issue stemmed from the company growing too fast in the 2000s and it essentially stumbled under its own weight. In his return, Howard focused on giving customers quality products with consistency. He even invited customers to contact him to address the areas where the company could improve – this proved to be very successful in developing customer loyalty. Howard even took the decision to briefly close all stores to retrain staff and educated them on the company’s values. Starbucks has since enjoyed enormous success and has more than 28,000 stores worldwide. Howard Schultz remained in the CEO position until stepping down in 2017.
Netflix was originally started as a mail-order DVD service in 1998 and a little over a decade later, the company began its online streaming service. This was when the company made its biggest mistake. Netflix decided to separate DVD subscriptions and streaming subscriptions and up their prices. The company decided to name the DVD subscription Qwikster. This move created an exodus of more than a million subscribers who fled Netflix in a single quarter. As a result, the stocks shares plummeted from $300 a share to $65 by the end of 2011. Despite scrapping Qwikster and issuing a public apology, during the next 18 months, Netflix endured a very tough time. The company was perhaps saved in 2013 when they released their original series House of Cards. With both the critical and viewer acclaim that came with House of Cards, Netflix began creating more and more original content, and now has over 150 million subscribers.
Like Starbucks, General Motors (GM) almost ended up in the scrapyard because of the 2008 economic downturn. The automobile giant faced huge losses and filed for bankruptcy, which resulted in tens of thousands of workers being laid off. After entering into bankruptcy in 2009, GM successfully pleaded their case to Congress for a bailout and the $50 billion provided by the US government saved the company. This saw GM re-emerge from bankruptcy and the government decided to sell its shares. By the end of 2013, the government had sold all its shares, capping an impressive turnaround that saved an estimated 1.2 million jobs. GM was restructured and endured multiple interim CEOs before Mary Barra was installed as the first female CEO of a major automaker in 2014. Under her leadership, the company steadied and remained the most popular carmaker in the US. The company is believed to be worth in the region of $140 billion according to GoBankingRates.
Marvel being the home of captain America and Spiderman has for so long been the comic-book world’s biggest player. It was founded in 1939 by Martin Goodman and was an instant hit with its creation of the Human Torch, Sub-Mariner and Captain America. The company enjoyed enormous success all the way up to the 1980s, but the 1990s saw the company come crashing down. Marvel went into bankruptcy and the comic book market collapsed. The problem was that Marvel had been expanding their company and were in all kinds of debt. They had made some poor business choices that just weren’t paying dividends. In 1997 Marvel Entertainment Group joined hands with Toy Company and together formed Marvel Enterprises to stage a business comeback. The management of Marvel Enterprises decided to diversify and change its approach from paper and ink to movies, resulting in hit movies such as Iron Man, X-Men and the Avengers. These films essential saved the company from going under. The company was bought by Walt Disney Company in 2009 for $4 billion, but it’s thought that Marvel is worth an awful lot more today.
IBM has been around for more than 100 years and the company has firmly established itself as a true global leader. They have been responsible for some game-changing inventions including the ATM, magnetic stripe cards and floppy disks. IBM is one of just a handful of companies that has managed to keep its spot on the Fortune 500 list for more than half a century. However, the 1990s were rather challenging for the company. In 1992, the company announced a loss of $5 billion – more than any other American company ever had at the time. This led to massive changes within the company, but they came with a cost. As part of this change, Lou Gerstner was appointed as the new CEO and to take the company forward. He fired close to 100,000 people, changed IBM’s marketing strategy and invested in software line and IT services areas. As of 2019, IBM is worth in the region of $200 billion and I think it’s fair to say Gerstner’s changes saved the company.
Written by Stephen Larkin
Published: 21 August, 2019