A while back in my 486G class, we have talked about how MacDonald’s does not only sell burgers but their ‘true business’ is real estate. This shocked me at first because I thought if they don’t sell burgers and fries? then WHAT do they sell? It only made sense that fast food may be too volatile of a business but real estate in the long term creates more insurance because they are tangible assets which will still be there even if no customers come.
Walking along a blockbuster one night after dinner, I’ve noticed that not many people are renting movies anymore. Given the location of where it is located, it is the easiest spot for consumers to drop by and to pick up a movie. Then I remembered the 486g lecture when we discussed about blockbusters. Although very few people rent from blockbusters nowadays due to illegal online downloading and the easy purchases from itunes, blockbusters still has its land. Similarly to Mcdonald’s, Blockbusters has real estate as its backbone. I feel that Blockbusters still has some trump cards which haven’t been played, given the huge amounts of assets (land) they have huge potentials in making a comeback, given that the government actively strengthens anti-piracy laws and arresting people who are downloading movies.
