Handbag maker Lambertson Truex has filed for chapter 11 bankruptcy, citing reduced demand. A company executive said high-end spending had slowed, leading to a cash crunch. Lambertson Truex has closed two retail stores, while parent company Samsonite has kept its New York location. Lambertson Truex handbags can cost up to $18,000.
David Wertheimer: March 2009 Archives
Ann Taylor is expanding its restructuring program and identified more store closings for 2009. The company--which is not restructuring under bankruptcy bylines--is closing an additional 37 stores in 2009, including 10 Ann Taylor and 37 Loft doors. The overall plan now includes 163 rather than 117 store closings.
Dillard's responded to poor sales and investor pressure by announcing plans to close five stores. The department store chain closed 21 doors in 2008. A handful of store closings are normal in a given year, but Dillard's announcement was timed to respond to the company's performance.
An interesting (if not unexpected) side effect of slow retail sales is its impact on job opportunities. As of December, the sector had 1.54 million unemployed retail workers and just under 300,000 job openings--more than twice the rate of a year ago. And the sector is attracting job-seekers new to retail, compounding the competition for jobs. With the average retail position paying $9.69 an hour, the growing applicant pool underscores the severity of the recession.
The economic downturn is hitting local stores especially hard. Saddest among those affected are the decades-old establishments suddenly facing bankruptcy or liquidation. Recent news affects regional chains with long histories:
- Cincinnati: luggage store Bankhardt's is closing. The store is 130 years old and has inhabited the same location since 1935. The business owner sold the building and is moving on. Interestingly, three splinter stores with the same name will continue to operate.
- The 16-store jewelry chain Robbins Brothers filed for bankruptcy after struggling during the recession. Robbins Bros' history dates to the 1920s, in Seattle, before moving to California and ultimately expanding to four states.
- In the Pacific Northwest, Joe's Sports and Outdoor is operating during a restructuring. The 30-store chain is owned by a private equity firm that filed as a strategic move. Joe's first opened in 1952 as a military surplus store.
New England retailer Better Bedding is closing more than half its stores as part of a bankruptcy restructuring. The company, which has 21 outlets, is shutting 11 of them and consolidating inventory. Better Bedding cited a 20 percent sales decline as part of the problem. The chain has been in business more than 30 years and is family-owned.
Door manufacturer Masonite announced a bankruptcy filing today. The company, which pioneered the use of special hardwood manufacturing techniques, has been in business since 1924. Masonite is widely used by construction and moving companies. Masonite Inc., which has been privately owned since 2005, reportedly has the financing in place for a successful restructuring.
Insiders have revealed that Virgin Megastore will be closing all its locations by this summer. Timely Demise covered three of the six closings last week; specific plans for the other three, in Denver, Hollywood and Orlando, have not been revealed. Billboard.biz reports parent company Virgin Entertainment Group North America will be liquidating in conjunction with the closings.
Even with six stores, Virgin Megastore was among the last and best-known national music chains. All coverage of this news notes what TD spotted last week: that Virgin Megastore's real estate ownership is going to profit more handsomely from increased rent--even in a down market--than it has as a music retailer.
