restructuring and resizing: March 2009 Archives

The fashion world, rocked by the sharp slowdown in retail sales the past six months, is now struggling to stay afloat. In-demand menswear designer Thom Browne is struggling to find a financial backer and battling a drop in retailers' orders for his $5,000 men's suits. The fashion house may have to file bankruptcy if backing is not found soon.

Meanwhile, mass marketeer Marc Ecko is refinancing hundreds of millions of dollars of debt. The lack of liquidity in the financial markets suggests Ecko may have to divest some of its business lines in order to meet the debt obligations.

This is intriguing: a number of malls nationwide are cutting hours, instead of closing stores. Barnes and Noble is changing hours across the country. "General Growth, which is trying to avoid filing for bankruptcy protection, is changing the hours at many of its malls across the country, including Baltimore-area locations White Marsh Mall, Owings Mills Mall, Towson Town Center, Mondawmin Mall and The Mall in Columbia. The malls will close a half-hour earlier Monday through Thursday and close an hour earlier Friday and Saturday. On Sunday, the malls will open an hour later."

Famed luxury goods purveyor Tiffany might look immune to the recession but actually they are in a world of trouble. "Net income fell to $31.1 million, or 25 cents per share, down from $127.4 million," for one thing; these costs are associated with store closing and with layoffs. So what's Tiffany's solution? More layoffs! "Tiffany plans to offer early retirement packages to 800 of its employees in the U.S., and cut 10% of its staff worldwide." Great plan.

The 129 Boater's World stores in 27 U.S. states are being shuttered. Parent company Ritz Camera Centers Inc. (who knew?) filed for bankruptcy protection last month, and is attempting to raise cash by liquidating the boat stores' inventory. The company will also close 400 of its 800 camera stores.

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.

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.