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30 Companies You Didn’t Know Were At Risk Of Bankruptcy

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The year 2018 will be remembered as the year with the highest retail bankruptcies ever. And more drops are expected in 2019 as well. According to a report from S&P Global Ratings, retail liquidations is reaching its peak. You may be really shocked by businesses that have made this list.


When you enter a retail store and you are welcomed with a big smile, your only belief is that the business is booming. However, the truth is usually somewhere out there. Step in and see if your favorite business made this list.

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1. 99 Cents Only

This traditional retailer has found itself in a world full of hard competition. 99 Cents Only is facing competitors like Walmart, Dollar General, and Dollar Tree. The company reported a loss of $27.1 million in December 2017. In addition, they lost $8.8 million in Q1 and $33.6 in Q2.

99 Cents Only is a 35-year-old company, that had to change its business politics and even its owner. The new CEO is Jack Sinclair who replaced Geoffrey Covert. Despite reporting positive numbers and managing to increase sales, they still continue losing a lot of money.

2. Fred’s Pharmacy

Fred’s Pharmacy is a 70-year-old-pharmacy that was on top of its game, until May 2018. At that time it was revealed that for the past fiscal year sales went down for 4.3 percent and its net loss was at $139.3 million. The initial strategy was to increase the number of stores, going from 600 to 1,000 stores.

However, the plans were unsuccessful. Extra spaces were ready for taking over. In addition, Fred’s CFO left February 2018, putting a formed media executive as a replacement. Fred’s went up for sale putting a pharmacy on the market for $40 million.

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3. Stein Mart

Stein Mart is a known Jacksonville-based discount department store. Unfortunately this store has also been struggling for some time with boosting their sales. In 2017 it seemed like the company is stable. Digital sales even grew by 47 percent. However, the loss for the year was $23.4 million.

However, it seems that Stein Mart is here to stay! At the beginning of the year, Mart’s management announced that they hired a group of advisors to help them turn around. In addition, this March Stein Mart was able to close on a $50 million term loan. So far, it seems that they are improving significantly.

4. Office Depot

Online trends are shifting offline business, especially office supply retailers. Office Depot hit some tough times in 2017. Their sales went down for 7 percents, or $10.2 billion. Gerry Smith, Depot’s CEO, announced that they are working on a shift from being a retail store exclusively to including additional services.

One of Depot’s major business improvements is seen in service called “BizBox” which offers more services than products. This move also led to the acquisition of IT firm CompuCom. The services of Depot now make 14 percent of the retailer’s sales.

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5. Bebe

Manny founded the company in 1979 together with his wife Neda Mashouf. However, the biggest shock for the company was when Neda, at that time Beba’s creative director divorced Manny Mashouf in 2007 and left her position. That move together with declining mall popularity affected Bebe to the down road. They had a loss of $4.6 million, in 2017.

Bebe decided to move from the traditional retail space, to e-commerce only. According to Forbes Bebe had 180 stores at the end of 2016, and they had to pay out $65 million to get rid of it. This shift from traditional stores to e-commerce is common for retailers, and it is definitely a safer move than keeping the stores open. Bebe also introduced their loyalty program that is supposed to bolster their online sales.

6. Guitar Center

Nothing will ever be the same for Guitar Center since 2018. This rock n’ roll supplier had a limit of just one year to refinance a debt of $900 million. Although this business is 50-year-long tradition, it just seemed that people stopped buying guitars. From 2005 to 2016 electric guitar sales dropped by incredible 36 percent.

But, regardless of its financial troubles, Guitar Center is planning to open new stores and to avoid a crisis with emergency loan negotiation. Michael Amkreutz, EVP of merchandising and e-commerce, says that the company is still quite strong, but is in a transition phase.

7. Nine West

At this moment, the famous shoe retailer is in debt of $1.5 billion. They are working on restructuring their debts, which includes selling shares of the company and filing for Chapter 11 bankruptcy. Nine West even sold its Easy Spirit brand and put a lock on a wide number of its stores. Currently, only 25 stores are still actually open.

Nine West is making a product shift as well. They are moving from shoes to jewelry and clothing lines. According to The Post, the biggest influence on Nine West and its down road was the change of their costumers’ interest, as the demand for sandals, heels and ballet flats has been declining for years.

8. Bon-Ton

This is a one-hundred-years-old company. At one moment it seemed that they will officially become a part of history when they filed for bankruptcy in 2018. This giant was sold and liquidated in no time. However, the same year in October, Bon-Ton announced its re-launching. They have opened online stores and became entirely e-commerce.

New Bon-Ton is on a mission to be fully e-commerce focused business. The general opinion is that they were able to survive in smaller towns where they had no, or weak, competition and that Amazon affected their business the most. Therefore, it’s no surprise that they are following customers’ preference for e-commerce.

9. FullBeauty Brands Holdings Corp

FullBeauty is known for its own brands that are focused on plus-size women and men. Some of their brands include KingSize, Woman Within, Brylane Home, Jessica London, and Roaman’s. FullBeauty blames Amazon for its diminishing sales. This is the ultimate message from most retailers.

It all started when the Company’s earnings dropped 30 percent during 2017. A major management shift happened in 2018 when a new CFO Bob Riesbeck, new chief customer officer Liz White, and chief people officer Robert Lepere, stepped in. The new dream team is supposed to skyrocket the company’s growth and rebalance what was already lost.

10. PetSmart Inc.

PetSmart Inc. is one of the biggest pet leaders in the States, with more than 1,500 stores all over the States, Puerto Rico and Canada. But, little was known about $8 billion debt problem that this company announced in June 2018. The root of the problem is the same as for other stores – online stores. According to Reuters, PetSmart Inc. won’t face its debt maturities until 2022.

Buying online is great to consumers in terms of prices and convenience. In order to meet these costumers preferences, PetSmart Inc. bought an e-commerce site, Chewy. However, buying Chewy brought an additional $3.35 billion of debt. According to Reuters, this was the highest pay ever for e-commerce.

11. Brookstone

Brookstone announced bankruptcy in August 2018. The following step was closing of 101 different locations all over the States, according to CNBC. This store is known for selling tech products, next to the items to use at home. Some of the items included fancy pillows, gadgets, and massage chairs.

Brookstone is on a mission of finding their perfect buyers and are looking for ways to reach out to wholesale operations, e-commerce businesses and airport locations. According to CNBC, Brookstone will close all of its mall locations which would leave a lot of empty mall spaces across the U.S.

12. Toys R Us

Toys R Us financial troubles shook the nation. Once the bankruptcy was announced Toys’ management said that they are planning to liquidate every single store. That meant the closing of 735 just in the States and letting go of all employees. This plan is ongoing.

The logic behind fast stores closing is next – the more stores remain open the more will they owe landlords. But, according to the recent reports, it seems that the brand is not dead yet, and there were even rumors of a potential rebooting.

13. Bertucci’s

This famous Italian restaurant chain filed for Chapter 11 bankruptcy in spring 2018 and closed 15 stores immediately. They have been struggling to compete with other fast-casual restaurants that offered pizza at even cheaper prices. Eventually, Bertucci’s was sold to Orlando, Florida-based Earl Enterprises for $20 million.

Earl Enterprises is known for other objects, like Buca di Beppo, Planet Hollywood, and Earl of Sandwich. The deal between original Bertucci’s and Earl Enterprises included $3 million in cash, $4 million in credit, and $13 million in debt.

14. Diesel USA

Once the strongest denim retailer announces bankruptcy on March 5, 2019. The bankruptcy document stated that Diesel came to this situation thanks to the “general downturn in the brick-and-mortar retail industry,” next expensive leases, fraud, and even theft actions.

Bankruptcy announcement was a scream for reorganization, which included ‘smaller steps’, like stores relocation, more strategic approach when it comes to locations in general, opening a Miami pop-up shop, and rebranding. Fingers crossed!

15. Pacific Gas and Electric (PG&E)

Thanks to the California wildfires of 2017 and 2018, this investor-owned gas and the electric company filed for Chapter 11 bankruptcy on January 29, 2019. What was the most interesting about this period, was the company’s announcement that they want to approve $235 million of bonuses for their employees. Regardless of the bankruptcy.

California state Senator Jerry Hill said that “$235 million would go a long way to support the victims of last year’s wildfires.” It seems that the company is in the limbo of wildfire victims and its creditors.

16. The Weinstein Company

Co-founder Harvey Weinstein was accused of sexual misconduct in October 2017 after the New York Times article. Some of the women to come forward were actresses, Ashley Judd, and Rose McGowan. The accusation of sexual misconduct affected The Weinstein Company to such an extent that they had to file for bankruptcy in March 2018, only 5 months after the article was published.

However, the film company found a buyer in May 2018 – Lantern Capital Partners, a famous private equity firm, based in Dallas. According to The New York Times Lantern stepped in with no less than $310 million. In addition, its speculated that $115 million was paid in debt. Lantern firm doesn’t have any Hollywood background or experience, instead their field of interest was zinc recycling and auto dealership, so it will be interesting to follow their development of Hollywood portfolio.

17. BKH Acquisition Corp.

Over 100 Burger Kings objects in Puerto Rico are under one company’s direction – BKH Acquisition Corp. They operate with this thanks to and through its subsidiary, Caribbean Restaurants. The company got public attention in 2017 when Distressed Company Alert listed them. The public list was a division of New Generation Research, Inc., and BKH was given a low rating.

Their credit was lowered on January 11, 2017, from CCC+ to B-. This rating from S&P Global Ratings was explained by saying that the company became vulnerable. Olya Naumova, a credit analyst, gave a further explanation of the rate by saying that it was affected by Puerto Rico’s persistent economic weakness caused by the ongoing credit crisis.

18. J.C. Penney

Another company that started this year with financial struggling is J.C. Penney. The spokeswoman of J.C. Penney didn’t want to comment further on their stores’ future closures, however, experts say they are expecting between 20 to 100 locations to be closed throughout the year. According to Cowen and Co. analyst, Oliver Chen, the department store chain should close up to 125 stores in order to get a healthier fleet.

Flickr: Mike Mozart

But that won’t be enough to save them. First, they have to make sure their clients are captured and still loyal, then they have to do something about their apparel in order to make it more attractive. In fact, this all bankruptcy rumor stated because their merchandise couldn’t sell and they ended up putting major discounts in order to get rid of the products.

19. Things Remembered

Things Remembered is known for creating personalized gifts and keepsakes like engraved items, including wallets, jewelry, bags and much more. They also personalize jewelry boxes. However, Things Remembered filed for Chapter 11 bankruptcy on February 6, 2019.

Thankfully to those who are fond of personalized gifts, this company keeps on living. According to Retail Dive, Things Remembered are now under the ownership of Enesco, business known for its gift and home decor business. Company is online-based, and function through direct mail and B3B retail operations. Interestingly, 176 stores will retain the Things Remembered name.

20. Shopko

The Wisconsin-based retailer filed for Chapter 11 bankruptcy on January 16, 2019. Shopko announced that they are about to close 70 percent of its retail locations during the business reorganization, between February and March 2019. The retailer announced in February 2019 that it would close 251 stores, and leave 110 retail locations open.

In December, the number of closed stores was significantly smaller. Shopko’s spokeswoman Michelle Hansen told USA Today that they have realized that’s in their best interest to operate with a significantly smaller store footprint. They came to this realization of insight that they got from potential buyers.

21. Charlotte Russe

Charlotte Russe struggled for years after the online shopping won over the traditional retail. It looks like they couldn’t handle the battle with the online ecommerces offering low prices, and they went in debt.

Eventually, the popular women’s retailer filed for bankruptcy in February 2019. In the same month, Charlotte Russe hoped to find a buyer and secured a $50M debtor-in-possession financing commitment. However, the plan didn’t turn out quite well for them, and they are closing all of their stores nationwide.

22. Payless

Payless ShoeSource Inc. is a footwear chain that offer shoes and sneakers at discount prices. In february 2019, Payless announced that their e-commerce business as well as their North American stores were closing and filing for bankruptcy.

However, stores outside of North America will still continue to work. The footwear that produced the 80’s popular sneakers Pro Wings and existed since 1956, is now one of the largest retailer liquidations U.S. has seen.

23. Beauty Brands

The Kansas City-based beauty retailer filed for bankruptcy in January 2019. Beauty Brands made an asset purchase agreement with Hilco Merchant Resources for the sale of their assets.

Beauty Brands will be closing 25 stores, while the remaining 33 will stay open. The beauty retailer is reorganizing their operating assets in hope of a better profit.

24. Innovative Mattress Solutions

Last couple of years, multiple bed-in-box startups like Casper rose and won in the mattress competition. Innovative Mattress Solutions couldn’t keep up with the competition and filed for Chapter 11 in January 2019.

They secured an $14M in debtor-in-possession financing agreement from Tempur Sealy while the company is waiting for a buyer. Store closures in southeastern US are expected.

25. Gymboree

The children’s apparel company that owns Janie & Jack as well as Crazy 8 stores, filed for Chapter 11 in January 2019. This is the retailer’s second bankruptcy. They announced that they would close their 800 stores in the US and Canada.

They already closed 300 stores after their first bankruptcy in June 2017 and managed to eliminate their debt, but they have however continued to lose their market share. Gymboree brand is now looking for a buyer that would be ready to pay for it $76M. Their Janie and Jack clothing line will be sold to Gap Inc for $35M.

26. Z Gallerie

Z Gallerie is a Los Angeles-based home furnishing chain that was founded by siblings Joe Zeiden, Mike Zeiden, and Carole Malfatti in Sherman Oaks, California back in 1979. They were working fine until this year, when they filed for Chapter 11 in March 2019.

In July 2019, the Z Gallerie’s assets were acquired by DirectBuy through a bankruptcy auction for $20.3 million. The purchase included their headquarters and their 32 stores. Other 17 locations will be closed, and there might be more closures expected by the end of the year.

27. Roberto Cavalli

According to Business of Fashion, Cavalli has been operating at a loss since 2013. Only in 2018, the brand reached a loss of 17.8 million dollars. The instability of the brand led them to close all North American Cavalli boutiques.

In April 2019, they also shut their senior management down, which included the resignement of their US CEO Salvatore Tramuto. It looks like the famous brand can’t handle the retail apocalypse either.

28. Kona Grill

Apart from the retail companies, another food chain has filed for bankruptcy – the sushi and cocktail chain Kona Grill. The decision to file for bankruptcy happened in April 2019, which led to closure of some of their locations.

So far, 15 locations are shut down. The bankruptcy is probably due to the Kona Grill’s legal conflict with their former CEO. However, there might be some light at the end of the tunnel, as the chain is being bought by another former CEO.

29. Perkins & Marie Callender’s

The Perkins & Marie Callender’s bankruptcy is the most recent one. Namely, the company filed for Chapter 11 in August 2019, after closing 29 of their location. 10 Perkins restaurants were closed, as well as 19 Marie Callender’s.

They hope to restructure and reorganize their assets in order to regain what they lost. Unfortunately, the bankruptcy will impact an estimated 1,190 employees that worked for the company.

30. Barneys New York

Finally, one of the most shocking bankrupcies is the one of Barneys New York. Namely, the New York based retailer filed for bankruptcy on August 6 2019, and is looking for a buyer.

The reason behind their crash are skyrocketing rents and incredible foot traffic. However, Hilco Global and Gordon Brothers Group have secured financed the retailer.

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