Companies Can Survive The Retail Apocalypse If They Own Intellectual Property

by MR Magazine Staff

Retailers can survive the retail apocalypse if they control their intellectual property, said Gerald Storch, CEO of Storch Advisors, a retail advisory firm. “If [a company] is vertical, the margin is much richer,” Storch told CNBC, referring to a company that owns its own supply chain. “You can afford to play on the internet, which in and of itself is more expensive, believe it or not, than operating stores, in terms of delivering the bottom line.” A company that is vertical, Storch said, can control “that price transparency aspect where you see the product everywhere on the internet. The price goes down to the marginal cost.” One company that could benefit from the model: Toys R Us. Storch, who served as CEO and chairman of the company, said on “Closing Bell” on Friday that the company is still “very valuable” with a lot of intellectual property. “You can control your intellectual property through your relationship with vendors if you have very good, differentiated offerings that your vendors have to provide,” said Storch, who has also served as vice chairman of Target. Read more at CNBC.