topic Re: Geller Bankruptcy Latest Update in Beauty

Geller Bankruptcy Latest Update

Johnnyeager — Mon, 11 Feb 2019 14:39:28 GMT

For those interested, the assets of Glansoal, including Laura Geller businesses, were sold to the successful bidder, AS Beauty (owner of E.L.F.) on January 29th and the sale closed February 6th.

There were several other bids for the assets, including one which wanted only Julep (successful bids had to be for Geller, Julep and Clarks Botanicals assets).

One of the contracts rejected in bankruptcy court was with QVC. QVC contracts are notoriously unfriendly to makeup/skincare vendors and was one of the compelling factors drinving the company into bankruptcy. Rejecting the contract with court approval may allow the brand to go elsewhere. I suspect that Geller products may remain with QVC but under renegotiated terms.

Re: Geller Bankruptcy Latest Update

fthunt — Mon, 11 Feb 2019 16:17:24 GMT

Thanks for posting - although I'm no expert in that big world. Would like to understand more about QVC negative involvement.

Re: Geller Bankruptcy Latest Update

2blonde — Mon, 11 Feb 2019 16:32:59 GMT

I seem to remember similar contract issues being mentioned (QVC) with the Mally line when it went through bankruptcy and sale.

Re: Geller Bankruptcy Latest Update

jackthebear — Mon, 11 Feb 2019 16:33:47 GMT

@Johnnyeager wrote:
For those interested, the assets of Glansoal, including Laura Geller businesses, were sold to the successful bidder, AS Beauty (owner of E.L.F.) on January 29th and the sale closed February 6th.

There were several other bids for the assets, including one which wanted only Julep (successful bids had to be for Geller, Julep and Clarks Botanicals assets).

One of the contracts rejected in bankruptcy court was with QVC. QVC contracts are notoriously unfriendly to makeup/skincare vendors and was one of the compelling factors drinving the company into bankruptcy. Rejecting the contract with court approval may allow the brand to go elsewhere. I suspect that Geller products may remain with QVC but under renegotiated terms.

interesting and not surprising

the idea of being on the Q must be amazing to be new brand but they want everything for nothing.

However so many new companies are selling via SM so who knows how that will play out going forward.

Re: Geller Bankruptcy Latest Update

Johnnyeager — Mon, 11 Feb 2019 16:54:53 GMT

One of the ways QVC handles some vendors, like Geller products, is with royalties.

QVC orders product based upon its expectations, for example, a TSV and Geller contracts with its manufacturers in Italy, China, Canada for product. Geller gets airtime and marketing from QVC and pays royalties for sales, but is stuck warehousing unsold inventory.

The bankruptcy filing specifically mentions the burden of warehousing, repackaging and disposal of unsold product when sales didn't materialize as expected.

Re: Geller Bankruptcy Latest Update

IntoSkincare — Mon, 11 Feb 2019 18:32:02 GMT

I also believe Francesco Clark bought Clark's Botanicals back last week...

Re: Geller Bankruptcy Latest Update

LTT1 — Mon, 11 Feb 2019 18:47:05 GMT

@jackthebear

What is “selling via SM?”

Thanks...I am unaware of the term SM

Re: Geller Bankruptcy Latest Update

Puppy Lips — Mon, 11 Feb 2019 18:54:06 GMT

Wow. Okay, I thought that QVC bought the products from the vendors at a negotiated rate, and then it was up to QVC and the vendor to sell it. Maybe it is different with beauty products and things that have an expiration date.

Years ago I met a woman who had been on QVC selling her seat cushions that had hanging pockets on the sides for craft supplies. I thought that is what she told me, that QVC buys the product outright and it is theirs to sell.

Re: Geller Bankruptcy Latest Update

IntoSkincare — Mon, 11 Feb 2019 18:54:38 GMT

@LTT1 wrote:
@jackthebear

What is “selling via SM?”
Thanks...I am unaware of the term SM

Social Media

Re: Geller Bankruptcy Latest Update

Puppy Lips — Mon, 11 Feb 2019 18:54:39 GMT

@LTT1 wrote:
@jackthebear

What is “selling via SM?”
Thanks...I am unaware of the term SM

I am thinking Social Media

Re: Geller Bankruptcy Latest Update

LTT1 — Mon, 11 Feb 2019 19:09:45 GMT

@Puppy Lips @IntoSkincare @jackthebear

Got it! Thanks!

Re: Geller Bankruptcy Latest Update

ValuSkr — Mon, 11 Feb 2019 19:10:01 GMT

Okay, thank you for the update. I thought all contracts were usually voided during bankruptcy. At any rate, Q will have to impose less onerous conditions if it wants to continue selling Laura Geller.

Re: Geller Bankruptcy Latest Update

SahmIam — Mon, 11 Feb 2019 19:45:32 GMT

@Puppy Lips That's exactly what I thought as well. I always wondered how they could sell so many items and then get them mailed out so quickly not knowing how it worked.

It was an interview Chaz Dean did YEARS ago that discussed how QVC purchased XYZ amount and if a TSV, how whatever didn't sell the vendor had to buy back. The person conducting the interview had asked if he was really surprised when a QVC host would state the price about something and the vendor would mutter in a surprised tone "I can NOT understand how QVC can sell it so low!!". It was discussed how the vendor gets paid their amount up front and then QVC prices it as they choose. Then, the remainder is placed into back stock/warehouse for a certain amount of time. TSV's are bough back if it doesn't sell out. Made sense to me. The Joy Spin-mop thing worked that way as well (as per the movie).

Obviously they've changed it.

Re: Geller Bankruptcy Latest Update

luvmybeetle — Mon, 11 Feb 2019 19:46:04 GMT

I would prefer to buy my cosmetics from Ulta or the Bare Minerals stores now. This sounds shady to me. Or maybe I'm not understanding.

Re: Geller Bankruptcy Latest Update

Johnnyeager — Mon, 11 Feb 2019 20:09:03 GMT

@IntoSkincare wrote:
I also believe Francesco Clark bought Clark's Botanicals back last week...

Right. After the sale of the whole package to AS Beauty, Francesco Clark bought Botanicals back from them. Too complicated for me at this point!

Re: Geller Bankruptcy Latest Update

iwrite — Mon, 11 Feb 2019 22:27:45 GMT

@Johnnyeager

thank you for posting this.
i find it very intriguing.

one sells their company to a larger company for a big pay check, then the larger company files bankruptcy.

why sell your company, knowing that some others before you that have done this, did not fare well in the long term. never mind having to scale down the quality ingredients to be able to hit the larger companies dollar amounts.

probably should have gone to shark tank or gone on the profit tv show. at least, you would still be able to have some control, of something that you put your heart and soul into, never mind the amount of sleep and life you gave up.

no, i'm not blaming the companies that sold out, i just honestly don't understand how one gives up their baby, so to speak. i would rather make less money and negotiate slightly better terms on my own, then to have people that don't care much about me or my company to tell me what to do. and then have the audacity to file bankruptcy.

as my grandmother would say, "the bigger they are, the harder they fall".

Re: Geller Bankruptcy Latest Update

ALRATIBA — Mon, 11 Feb 2019 22:43:25 GMT

@Johnnyeager wrote:
For those interested, the assets of Glansoal, including Laura Geller businesses, were sold to the successful bidder, AS Beauty (owner of E.L.F.) on January 29th and the sale closed February 6th.

There were several other bids for the assets, including one which wanted only Julep (successful bids had to be for Geller, Julep and Clarks Botanicals assets).

One of the contracts rejected in bankruptcy court was with QVC. QVC contracts are notoriously unfriendly to makeup/skincare vendors and was one of the compelling factors drinving the company into bankruptcy. Rejecting the contract with court approval may allow the brand to go elsewhere. I suspect that Geller products may remain with QVC but under renegotiated terms.

@Johnnyeager

From my point of view - if you are going to make a contract with anyone - you should have legal representation to protect your rights.

"Notoriously unfriendly" indicates to me that if was general knowledge.

Who in their right mind goes into contract on terms that might lead one to bankruptcy?

Re: Geller Bankruptcy Latest Update

iwrite — Mon, 11 Feb 2019 22:53:18 GMT

@ALRATIBA wrote:
@Johnnyeager

From my point of view - if you are going to make a contract with anyone - you should have legal representation to protect your rights.

"Notoriously unfriendly" indicates to me that if was general knowledge.

Who in their right mind goes into contract on terms that might lead one to bankruptcy?

yes, one should have legal representation. additionally, i think company owners would do themselves a favor by taking enough law school classes to be able to read and understand the contracts that their lawyers say are ok to sign. nothing beats understanding what you are signing first hand.

my theory is if a company wants to buy your company for 20 million for example, your company is probably really worth 40 million.

you'd be surprised what some will do for a multi million dollar check, and not give much thought to what could happen down the road.

Re: Geller Bankruptcy Latest Update

January121 — Mon, 11 Feb 2019 23:19:47 GMT

@LTT1 wrote:
@jackthebear

What is “selling via SM?”
Thanks...I am unaware of the term SM

@LTT1 .. thanks for asking.... I don’t know what SM stands for either 😃

Re: Geller Bankruptcy Latest Update

TY — Tue, 12 Feb 2019 04:31:54 GMT

When private equity gets involved in financing a company they saddle that company with a lot of debt that a lot of times the company can't handle so down the road that company ends up having to declare bankruptcy.