Struggling fashion chain closing 100 stores to avoid bankruptcy
The fashion and clothing retail chain has an aggressive plan to cut its way to survival.
As a number of retail chains have gone out of business after Chapter 11 bankruptcy filings, people often blame the Covid pandemic. In many cases, that's accurate because the pandemic-related shutdowns forced companies to take loans at unfavorable rates.
Once stay-at-home orders ended, business did not recover enough to service that added debt. You can directly attribute the death of dozens of local restaurants, bars, and breweries on this cash crunch.
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In other cases, it's not quite as simple, Forever 21, for example, likely had its cash position harmed by the pandemic, but its death was hastened by falling consumer interest. It's incredibly hard for fashion brands to remain relevant as tastes change.
Some companies, like The Gap have managed to survive the highs and lows. At times, the company's namesake brand has been in style and has carried the load. In other cases, the company's Old Navy brand has been the retail brand driving profits.
Countless retailers have filed for Chapter 11 bankruptcy and not recovered, eventually having to liquidate. You can build an entire mall with 80s, 90s and 00s clothing brands that no longer exist.