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Toxic Economy Shutters More Stores
By Christina Zarrello
The economy is in crisis and retailing is feeling the pain. A growing list of retailers are declaring bankruptcy and closing stores as the economic storm continues to batter the landscape. One of the safe harbors had been thought to be deep discounters, where shoppers could find bargains in lean times, but even this category is reporting massive store closings. Here are the latest seven retailers to announce they will be leaving a shopping center near you.
Marty's Shoes: Secaucus, NJ-based Marty's Shoes announced it would close all 47 of its shoe stores on September 12. The 34-year-old discount chain noted tough economic conditions, excess inventory and a 2006 management change as major reasons behind the closures. Marty's also noted that in 2007, it was severely hurt by a consumer-purchasing slowdown and excess inventory from the fall back-to-school season. It's founding CEO and president, John Adams, was brought back that year in an attempt to revive the company, but it was too little, too late.
Urban Behavior: This moderately-priced teen girls' apparel chain expects all of its existing stores will be liquidated by the end of October. DJM Realty, a retail real estate liquidation firm, has listed 60 Urban Behavior U.S. stores totaling 290,646 square feet as available. Urban Behavior's Farmington, CT-based company, CMT America Corporation, originally filed Chapter 11 on July 13.
Mattress Discounters: On 9/11, 30-year-old Mattress Discounters filed for Chapter 11 bankruptcy protection for the second time since 2002. The bedding retailer cited the industry downturn, weakened economy and new competition from furniture companies in the northeast as major factors behind closing 48 of its 140 locations. The retailer also cited a year-over-year sales drop that has occurred every month in 2008.
99ÃƒÆ’Ã†â€™ÃƒÂ¢Ã¢â€šÂ¬Ã…Â¡ÃƒÆ’Ã¢â‚¬Å¡Ãƒâ€šÃ‚Â¢ Only Stores: The dollar-store chain is closing 48 of its stores and exiting Texas. The retailer cited that its Texas-based stores only generated slightly more than half of the average sales calculated at its non-Texas stores. The discount retailer will instead focus on growing its 230 locations in Arizona, California and Nevada.
Build-A-Bear's Friends 2B Made Stores: Build-a-Bear will shutter all of its Friends 2B Made Stores. The retailer will shut down all nine Friends 2B Made stores and the concept's associated product line by the end of its fiscal third quarter. The announcement to close Friends 2B Made, a make-your-own-doll company, comes amid falling sales, which in its fiscal second quarter results, showed a $4.8 million loss. Same-store sales fell 17.9 percent in the second quarter, including a 20.5 percent drop in the United States.
Steve and Barry's: The discount apparel chain has begun closing 103 stores throughout the U.S. with liquidation sales at these locations underway. In July 2008, BHY Holdings LHC, an affiliate of investment firms Bay Harbour Management and York Capital Management saved the company from bankruptcy. Now, the retailer intends to operate with a smaller base of 173 stores, in an effort to achieve profitability.
Goodyear Tire & Rubber Company: Goodyear announces plans to close 92 underperforming locations across the country by the end of the year in a move to improve the profitability of its U.S. retail operations. Six hundred employees will lose their jobs as a result of the store closings. The company identified the retail tire and service stores after conducting a "rigorous review of operating performance and local market dynamics," according to Scott Vogel, vice president of retail operations for Goodyear.
For more complete coverage on store closings that have taken place throughout 2008, see:
The Big Squeeze: 10 More Chain Stores Closing Their Doors
Steve and Barry's Stumble, More Retailers Close Doors
Retailers on the Ropes, 12 More Chains Announce Closings
Three More Retailers Drop in the Toughest Economy in Years
Retail Bankruptcies and Store Closings Signs of Grim Economy
Sign of the Times: 6,000 Retail Stores Closing in 2008
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