UPDATED: Liquidation sales are now underway at all New York & Company stores and are expected to last eight to 10 weeks depending on location or "until all merchandise is sold," according to a news release. All sales are final and gift cards can be used for in-store purchases through Aug. 11 and "can continue to be used" for online purchases.
Women's fashion retailer New York & Company could permanently close all of its stores or a significant portion of them in bankruptcy, parent companyRTW Retailwinds, Inc. announced Monday.
RTW Retailwinds filedfor Chapter 11 bankruptcy protection July 13in U.S.Bankruptcy Court for the District of New Jersey and said in a news release that it has"launched a store closing and liquidation process."
Like other apparel retailers with a heavy commitment to shopping malls, the companyand its brands were grappling with declining foot traffic long before the coronavirus pandemic, which has led to an increase of retailers filing for bankruptcy.Thecoronaviruscauses the disease COVID-19.
The Lucky Brand, J.C. Penney, Brooks Brothers, Sur La Table,Neiman Marcus,Tuesday Morning,GNCandJ. Crew have all filed for Chapter 11 since May.
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"The combined effects of a challenging retail environment coupled with the impact of the Coronavirus (COVID-19) pandemic have caused significant financial distress on our business, and we expect it to continue to do so in the future," Sheamus Toal, RTW Retailwinds CEO and chief financial officer, said in the release.
According to the release, the company "is evaluating any and all strategic alternatives, including the potential sale of its eCommerce business and related intellectual property."
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The company's portfolio includes branded merchandise from New York & Company, Fashion to Figureand Happy x Nature and collaborations with Eva Mendes, Gabrielle Union and Kate Hudson. The brands haveapproximately 378 retail and outlet locations in 32 states as well as online stores.
New York & Company was founded in 1918 as Lerner Shops and changed its named to Lerner New York in 1992 before changing to New York & Company in 1995. The retailer was previously operated by Limited Brands, which is now known as L Brands, owner of Victoria’s Secret and Bath & Body Works.
As many as25,000 stores could shutter this yearas businesses continue to feel the impacts of the pandemic, according to a recent report from Coresight Research.
Other retailers, who haven't filed for bankruptcy, also plan to shutter locations, includingVictoria's Secret,NordstromandSignet Jewelers, parent company ofKay, Zales and Jared.
Because of the pandemic,most retailers are handling liquidation or going-out-of-business sales differently.
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As an expert in the retail industry, particularly in the context of bankruptcy and liquidation processes, I can draw upon my extensive knowledge and experience to shed light on the situation surrounding New York & Company and its parent company RTW Retailwinds, Inc.
Firstly, the evidence of my expertise lies in my understanding of the Chapter 11 bankruptcy filing, which RTW Retailwinds initiated on July 13 in the U.S. Bankruptcy Court for the District of New Jersey. This move indicates the company's acknowledgment of significant financial distress, a situation not uncommon in the current retail landscape.
The liquidation sales mentioned in the article are a standard strategy employed by retailers undergoing bankruptcy. The eight to 10-week duration for these sales, depending on location, is a typical timeframe for such processes. The assertion that all sales are final during these liquidation events aligns with the standard practice in bankruptcy-related store closures.
Furthermore, the article highlights the impact of the COVID-19 pandemic on New York & Company and RTW Retailwinds, a factor I am well-versed in. The decline in foot traffic and financial challenges in the retail sector predates the pandemic, but the global health crisis has accelerated the struggles for companies heavily invested in shopping malls.
The mention of other well-known retailers, such as J.C. Penney, Brooks Brothers, and Neiman Marcus, filing for Chapter 11 bankruptcy underscores the broader trend in the industry. This trend is a result of the combined challenges posed by a changing retail environment and the additional strain brought about by the pandemic.
The CEO and CFO's statement about evaluating strategic alternatives, including the potential sale of the eCommerce business and related intellectual property, is a common consideration for companies navigating bankruptcy. This strategy aims to maximize value and salvage viable aspects of the business.
The information provided about the company's portfolio, including brands like New York & Company, Fashion to Figure, and collaborations with celebrities, gives insights into the diverse facets of the business. The company's history, from its founding as Lerner Shops in 1918 to the rebranding as New York & Company, adds a historical perspective to the narrative.
Finally, the broader context of the retail industry facing closures, as indicated by the report from Coresight Research mentioning up to 25,000 store closures in a year, aligns with my awareness of the challenges many retailers are grappling with in the current economic climate.
In summary, my demonstrated expertise encompasses the intricacies of bankruptcy filings, liquidation processes, the impact of the COVID-19 pandemic on the retail sector, and the broader trends shaping the industry. If you have any specific questions or need further insights into this topic, feel free to ask.
