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Kennedy: The end of Trans World as we know it

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Categories: Business

It was bound to happen, and it did: Trans World Entertainment is no more.

The company, born in Albany in the 1970s, became the “last man standing” in entertainment retail, selling movies, music and pop-culture tchotchkes at FYE stores in malls nationwide.

But that business was sold off in February to a mirror-image Canadian firm, which retained the FYE name, leaving etailz, an Amazon Marketplace reseller acquired in 2016, as Trans World’s remaining asset.

Earlier this month, though, etailz rebranded as Kaspien, and Trans World became Kaspien Holdings. The headquarters for both now are in Spokane, Wash.

Kaspien Holdings CEO Kunal Chopra, who also held that title at Trans World, described the name changes as “a new chapter in our story,” which for etailz began in 2008 as the winning entry in a college business plan competition.

From being a third-party online seller of eco-friendly products, etailz grew into a top FBA (Fulfillment by Amazon) retailer, and now aims to leverage the software and other tools developed there to help businesses manage sales on more online platforms, including Walmart, eBay and Google.

“In short, we outgrew our old name,” the company said in announcing the rebranding.

(The name Kaspien, we’re told, was inspired by the Caspian Sea, a large inland body of water between Europe and Asia that “like many waterways, it’s a hub of commerce.” But there is debate on whether Caspian is a lake or a sea, and so as Caspian is “more than it appears to be,” so, too, is Kaspien, the company says.)

Kaspien Holdings, though, continues to have some of the same liquidity problems that troubled Trans World.

While revenue increased in the second quarter and first half from year-ago levels, the company reported last week, losses persist. In fact, “we expect to incur net losses in 2020,” as occurred in fiscal years 2018 and 2019, Kaspien’s regulatory filing states.

Cash generated from operations plays a minor liquidity role, the filing says; the primary sources are borrowings under a revolving credit facility, available cash and cash equivalents.

“Our ability to achieve profitability and meet future liquidity needs and capital requirements will depend upon numerous factors, including the timing and amount of our net revenue; the timing and amount of our operating expenses; the timing and costs of working capital needs; successful implementation of our strategy and planned activities; and our ability to overcome the impact of the COVID-19 pandemic,” the filing states.

As Kaspien, the company now is looking to become a “complete back office” for online sellers, which includes marketing, inventory and supply management, tax compliance, and brand control.

“In a time where both established and emerging brands are competing more than ever with the very platforms they’re selling on, Kaspien serves as a one-stop shop to create, execute and sustain a modern online growth strategy,” the company says.

Marlene Kennedy is a freelance columnist. Opinions expressed in her column are her own and not necessarily the newspaper’s. Reach her at [email protected]

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