Sports Authority

Sports Authority's 2016 liquidation ended America's largest sporting goods chain at a time when Americans were spending more on fitness than ever. The company's failure demonstrates that market growth doesn't guarantee incumbent survival—sometimes disruption kills precisely when demand peaks. The mechanism failure was format obsolescence. Sports Authority operated big-box stores with broad assortment but shallow expertise. Dick's Sporting Goods offered similar breadth with better execution; specialty retailers like REI and running stores offered deeper expertise; Amazon offered lower prices and unlimited selection. Sports Authority was the generalist squeezed by specialists on every dimension. Private equity loading accelerated the death. Leonard Green & Partners' leveraged buyout left Sports Authority with debt that consumed operational margin while competitors invested in stores and e-commerce. The company filed bankruptcy with $1.1 billion in debt and couldn't find a buyer willing to restructure—suggesting the core business model was unviable regardless of capital structure. 460 stores closed, 14,500 employees lost jobs, and Dick's Sporting Goods absorbed market share, demonstrating how retail extinctions transfer resources to surviving competitors rather than destroying demand entirely.