The world of retail is in a bit of trouble and several retailers are facing Chapter 11. As online shopping has increased over the years, foot traffic within American malls has been on a decline, and it isn’t showing signs of stopping. Many retailers are feeling the pressure of increased rent costs while online competitors like Amazon.com continue to edge them out. Our malls are suffering, too. According to data from CoStar Group, more than ten percent of U.S. retail space (roughly one billion square feet) may need to be closed, converted to other uses, or renegotiated for lower rent in the future.
Recently, a handful of retail stores have filed or are planning to file for Chapter 11 bankruptcy. Here are four stores who have just added their names to the list:
This privately-held women’s specialty apparel store, which was founded in 1950 in Grand Forks, North Dakota, announced in early March that it has filed for Chapter 11 bankruptcy protection. It plans on closing all of its 140 stores across 27 states, affecting around 1,400 employees. Since then, stores have been holding liquidation sales. Similar stores including American Apparel, The Limited Stores, and Wet Seal have followed suit and have ceased operations as well.
Another victim of the online shopping boom, Gordmans Stores Inc., filed for Chapter 11 bankruptcy with a plan to liquidate their items. This Nebraska-based retailer will be closing more than 100 stores across 22 states. Although it once thrived on strong customer loyalty, Gordmans posted losses in five of the past six quarters and listed a total debt of $131 million in their Chapter 11 papers. Their vendors have stopped supplying their goods as of March.
This ever-popular shoe chain filed for Chapter 11 bankruptcy and plans to close hundreds of their locations immediately in the United States and Puerto Rico. The chain, which has also fallen victim to increased online shopping, has more than 4,400 stores in more than 30 countries.
Although this teen apparel store hasn’t yet filed for bankruptcy, they are planning to do so soon, perhaps even this month. The chain, which boasts about 1,000 stores, is attempting to seek relief from enormous debt loads, which greatly stem from the $1 billion buyouts from Apax in 2013.
Even though retail stores and malls around the nation have been suffering lately, Class A malls continue to thrive. Additionally, according to research from Cowen & Co., customers prefer shopping in physical stores 75% of the time. The key is creating a unique experience for every customer.
Whether you’re an individual, a family, or a business, filing for bankruptcy is not an easy decision to make. Let Bankruptcy Advocates be your guide! We have more than 40 years of combined experience in representing families, individuals, and business in bankruptcy. Call us today for a free consultation at (618) 549-9800 to get started on your path to financial freedom.
Southern Illinois Bankruptcy Attorney law firm Bankruptcy Advocates is located in Carbondale and serves a wide geographic community. The first consultation is always free. Give us a call at 618-549-9800 or email us at [email protected] to speak about your case or legal matter. Convenient appointment times are available.