New Times,
New Thinking.

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3 January 2013updated 22 Oct 2020 3:55pm

Why zombies shouldn’t always be slain

A story about Apple, Lego and Ford.

By New Statesman

One phrase that entered common currency in 2012 was “zombie companies”: describing businesses that are clinging to life in a merely technical manner, that can pay their employees, but can’t expand.

As billions of pounds are tied up in these companies, many, like this FT article, have argued that they’re standing in the way of economic recovery: hogging a portion of the market that should be mopped up by rivals.

But the companies also do some good (they are keeping people in work after all) – and this blog from the Independent, citing TUC economist Duncan Weldon, suggests getting rid of them has a certain muddle-headedness about it:

As Duncan points out, many of the zombie slayers have a whiff of Andrew Mellon about them, the US Treasury Secretary who felt that mass bankruptcies during the Great Depression would “purge the rottenness out of the system” and enable “enterprising people [to] pick up from less competent people”.

The point is that spending levels are low right now, so companies which might not ordinarily deserve to go to the wall are struggling. As a case in point, here is the illustrated story of some near zombies who managed to pull themselves back from the brink of the grave: including Apple, LEGO, Ford and Old Spice (courtesy of bestaccountingschools.net – click through to their website for a larger version):

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