Donald Trump faces a difficult transition back into business
Credit: Carlos Barria/Reuters
Donald Trump’s reputation as a businessman was built on his belief he had the Midas touch.
He turned everything to gold: the taps and sink at his Taj Mahal casino in Atlantic City to the bottles in which he sold Trump Vodka.
There was the odd financial hiccup – such as filing for corporate bankruptcy four times.
For millions of Americans who watched The Apprentice and propelled him into the White House, Mr Trump’s image was one of financial success.
But events of the past week have turned the Trump brand toxic, making his return to corporate life more difficult.
“The big question is what damage the Trump political brand will do to the Trump business brand,” said Stephen Greyser, professor of marketing at Harvard Business School and an expert on reputation management.
Trump has extensive property interests
Credit: Tannen Maury/Shutterstock
“There is no doubt that what has happened in the last week or so with him becoming only the second president to face an impeachment trial twice will have an impact.”
It all raises the possibility that My Trump may leave the White House poorer than when he entered — a feat not matched by any of his recent predecessors who went on to earn millions from after dinner speaking and book deals.
Rejected by the voters, Mr Trump is free to take over the Trump Organisation, a sprawling family business with around 500 companies, which has been run by his sons Eric and Donald Jr. But what will he do?
He faces a mountain of debt which, according to an analysis of his tax returns by the New York Times, totals $421million (£309 million) – mostly due within the next four years.
His organisation has a massive property portfolio of hotels, golf courses, and apartment blocks which could be sold off should need arise.
That may well prove tempting, with even Mr Trump claiming that the presidency cost him and his businesses between $3 billion and $5 billion.
Donald Trump jr has run Trump Organisation with brother Eric
Credit: Jacqueluyn Martin/AP
The Covid-19 epidemic hit his hotels business badly.
Only last month, executives at the Manhattan hotel operated by the Trump organisation admitted a last summer’s brief recovery had ground to a halt following the new coronavirus surge.
"The hotels and golf courses are performing badly and they have been performing badly for some time,” Phillip Braun, professor of finance at the Kellogg School of Management, told the Telegraph.
He should not expect a flood of guests in the future, added John Quelch, dean of the Miami business school.
“Right now, very few individual consumers would want to tell their neighbours that they’re taking their family vacation at a Trump resort, even if they could afford to do so.”
With a likely blizzard of court cases linked to his tax and business affairs, Mr Trump’s return to civilian life was certain to be difficult
But these problems have paled into insignificance following the pro-Trump mob’s attempt to storm the Capitol and overturn Joe Biden’s victory.
Eric Trump has run organisation with his brother Donald Jr
Credit: Brendan Smialowski/AFP
Officials at Deutsche Bank told Bloomberg that it would halt doing further business with Mr Trump and his family beyond overseeing the repayment of $300 million in earlier loans.
Then Signature Bank, which called on Mr Trump to resign, said it was closing his personal accounts and also refusing to do business with any members of Congress who voted to overturn the presidential election result.
Florida-based Professional Bank, which once provided Mr Trump with an $11 million mortgage, said it would cease doing business with his organisation.
Things got worse. The PGA of America voted to strip Mr Trump’s golf course in Bedminster of a blue-riband tournament next year.
In Britain, the R&A announced the British Open would not be staged at Turnberry as long as the course was owned by Mr Trump.
“The PGA has decided having an association with Donald Trump is something they don’t want,” Prof Greyser added.
“The one thing they and their sponsors don’t want is continuing controversy.”
Just to add to Mr Trump’s woes, his attempt to offload the lease on his 263-room Washington DC is going nowhere. The organisation is unable to find anyone willing to stump up $500 million reported asking price.
And even Mr Trump’s native New York is looking to sever business ties, with the city council examining ending his organisation’s contracts to operate two skating rinks, a carousel and a golf course.
None of this will stop Mr Trump pursuing new ventures, with speculation rife that he will launch a media company.
“We have no doubt that there is a large group of consumers willing to support Trump after he leaves office, implying launching a media business would not be challenging from a subscriber standpoint,” said Wall Street media analyst Rich Greenfield of LightShed partners.
Even five million subscribers paying $5 a month, would bring in $300 million a year.
It would see him go head-to-head with Fox News, with whom he fell out over the election, and the rather more supportive One America New Network.
But even that could be awkward if big tech companies, like Amazon Web Services, follow Twitter’s example and decline to give him a platform.
And he has to raise the capital.
It all bodes badly for Mr Trump, according to Prof Braun.
“What will happen is there will be a lot of lawsuits and he is going to find it hard to raise credit. He is going to face a financial crunch."
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