Sharper Image out of Focus in Current Economy
- 1 Comment
Sharper Image, the high end uber gadget seller, recently filed for bankruptcy under Chapter 11. Another sign that the times are now changing as reported by the New York Times:
“The San Francisco-based company, which specializes in massage chairs, robots and other quirky gadgets, said it plans to close half of its 184 U.S stores while developing a reorganization plan to resolve operational and liquidity problems. Part of the plan includes securing a $60 million loan from Wells Fargo, the company said.
In recent years, Sharper Image has suffered declining sales and bad publicity over its line of Ionic Breeze air purifiers. Once among the company’s top-selling products, air purifier sales plunged to 9.4 percent last year, following allegations that the devices emitted ozone. A class action lawsuit is currently pending in California.”
The problem with this company is that it caters to a social mood that is spending and credit addicted. We have silver robots that clean up the floor of your home, we have air purifiers, alarm clocks that speak 30 different languages, and other useless stuff that people seem to “need” but in reality are only “wants” when push comes to shove. As you can see, we are now seeing all economic indicators pointing lower and the economy is nowhere out of the woods.
Sharper Image is now trading in the penny stock range and what once a symbol of excess and credit, is no longer able to compete in an environment where people are using gift cards to purchase food at Wal-Mart. Where are those much needed rebate checks?