hhgregg
Electronics and appliance retailer specializing in home entertainment and appliances.
PE-OWNED
Acquired by Golden Gate Capital2016-01-22
What Made It Great
Regional electronics and appliance retailer with strong customer service focus
What PE Will Likely Do
hhgregg will likely experience significant store closures and a decline in product selection and quality as Golden Gate Capital implements cost-cutting measures
Customers will likely notice reduced inventory levels, older or refurbished electronics and appliances, and a decline in in-store customer service and support
The brand's reputation for high-quality products and knowledgeable staff will likely deteriorate as Golden Gate Capital prioritizes short-term cost savings over long-term brand value
Expected Timeline
“0 to 6 months months”
Announcements about 'transformation' and 'optimization' with plans to close underperforming stores
“6 to 12 months months”
First round of store closures and staff reductions announced, leading to a noticeable decline in inventory selection and product quality
“12 to 24 months months”
Continued store closures and further reductions in inventory, including a shift towards more refurbished or lower-end models of electronics and appliances
“24 to 48 months months”
Bankruptcy rumors begin to surface as Golden Gate Capital implements more aggressive cost-cutting measures, including potential liquidation of the company's assets
Similar Cases
Other companies that followed a similar path after PE acquisition
What You Can Do
Actions
Be cautious of making large purchases at hhgregg, as the product quality and selection may decline over time
Consider shopping at alternative retailers that are not under PE ownership, as they may be able to provide a more reliable and consistent customer experience
If you are a current hhgregg customer, closely monitor the changes in the company's operations and be prepared to take your business elsewhere if the quality of products and services deteriorates
Alternatives
Employee-owned warehouse retailer
Publicly traded retailer with strong values