It’s not easy for apparel companies to stand up to the test of time. As the years go by, these companies are forced to adapt or die. And that holds true in more ways than one. In addition to keeping up with the latest styles, apparel companies must also keep their prices in check. Unfortunately, over the past few years, a large number of apparel companies have gone bankrupt or been forced to downsize for one reason or another. In the slides to come, we’ll examine these companies, including what went wrong.
Diesel Invested Too Much, Too Fast
In March 2019, the well-known denim brand Diesel filed for bankruptcy as the result of declining sales at its nearly 30 physical locations in the United States. In addition to slumping sales, the company got itself into trouble by making a $90 million investment in its stores, with little to show for it. When combined with $1 million+ in fraud and theft-related losses, it was too much for the brand to overcome.
To date, Diesel has plans on keeping its stores open. The company has a plan in place for cutting costs, improving the efficiency of its existing stores, and even opening new stores.
Charlotte Russe’s Brick and Mortar Model Failed
As online shopping grew in popularity, Charlotte Russe found it difficult to maintain strong sales in its brick and mortar stores. This resulted in loads of debt and a bankruptcy filing in February 2019.
Despite a debtor-in-possession financing commitment designed to help the company find a buyer – with hopes of keeping the brand alive – the brand continued to struggle until finding a new owner in YM Inc. As of late 2019, YM had opened roughly 135 stores with plans for more, along with a revamped website.
Payless Couldn’t Bounce Back From Bankruptcy
For many years, Payless was one of those brands that you expected to see in every shopping mall throughout the country. However, as its troubles mounted, the brand had no choice but to file for bankruptcy in 2017. And two years later, in February 2019, they did so again.
Unlike other brands that were able to emerge from the darkness of bankruptcy, Payless announced that it would close its remaining 2,000+ stores in the United States and Puerto Rico.
Gymboree Sold to The Children’s Place
In January 2019, Gymboree filed for bankruptcy for a second time. This resulted in the brand closing approximately 800 physical stores in the United States and Canada. As a result of its bankruptcies and general financial struggles, Gymboree sold its well-known brand along with Crazy 8, to The Children’s Place.
Gymboree was also the owner of Janie and Jack, a popular upscale children’s clothing brand, but solid the brand and assets to Gap. Even though the Gymboree brand isn’t what it once was, the brand lives on.
David’s Bridal Is Operating On Shaky Ground
David’s Bridal was once the biggest name in the wedding gown space, but this all changed in November 2018 when the company filed for bankruptcy. In addition to long-standing debt, for several years the company found it difficult to compete with the growing popularity of online-only wedding shops.
Fortunately, David’s Bridal was able to keep its doors open and website operating post-bankruptcy, which has allowed it to once again serve brides at more than 300 locations throughout the country. As more millennials continue to shop online, David’s Bridal has its work cut out for it. It will take some big changes to maintain its stability in the future.
Rockport Footwear Closed Their Stores
In May 2018, after many years of declining sales, Rockport finally bit the bullet and declared for Chapter 11 bankruptcy. It was a messy bankruptcy for the company, as its previous owner, Reebok and Adidas, got in on the action by stating that they were owed tens of millions of dollars.
This resulted in another curveball for the brand, as well as more money out the door. Even though there was hope that the Rockport brand would be saved, the company’s 60+ physical stores were closed shortly after its bankruptcy filing.
Nine West Racked Up More Than $1 Billion In Debt
Not only does Nine West have a long history of being one of the world’s top footwear retailers, but the brand was also one of the most financially successful for many years. But when April 2018 rolled around, Nine West’s problems were brought to the forefront for everyone to see.
Upon filing for bankruptcy, it was learned that the company was drowning in more than $1 billion in debt. While its online store is still functioning, all Nine West brick and mortar locations have been closed.
The Walking Company Filed For Bankruptcy, Again
Just the same as Rockport and Nine West, The Walking Company filed for bankruptcy in 2018. And this wasn’t the first time, as the brand had already gone down this path several years prior.
After emerging from bankruptcy, the company closed many of its stores while using more than $10 million in new equity to restructure its business. While the jury is still out on what comes next, in the meantime The Walking Company will continue with business as usual. And that’s more than can be said for many companies on this list.
A’gaci Has Plans To Save Itself
A’gaci was one of the first retailers to file for bankruptcy in 2018, taking action in January 2018 as a result of internal structural problems, failed expansion, bad debt, and overall poor sales.
With its bankruptcy in the past, A’gaci has plans to shutter some of its physical stores to put more resources into those that are performing best. The company also has big plans to launch a new and improved website in the months to come. This decision could make or break the company.
Styles For Less Closed Its Physical Stores
For teens, Styles For Less was a popular store for many years. But when November 2017 came around, the company finally realized that filing for Chapter 11 bankruptcy was the best way to keep its doors open.
Even though the Styles For Less website is still active, its physical stores are no longer. The days of seeing one of these in almost every shopping mall is gone forever. The company wasn’t able to see its way through the often-murky waters of post-bankruptcy business.
Aerosoles Is Trying To Keep Up With The Competition
As competition heated up, Aerosoles struggled to keep afloat in the footwear industry. Even though its shoes were priced to sell, other stores were able to undercut their prices, with the internet not doing the brand any favors either.
In September 2017, Aerosoles filed for Chapter 11 bankruptcy. As a result, it closed its brick and mortar stores and put all its resources into establishing a strong online identity. While the brand is far from what it once was, it was able to survive its bankruptcy thanks to the power of the online world.
Alfred Angelo May Have Left Some Brides Hanging
Alfred Angelo ran into many of the same issues as David’s Bridal, which resulted in a Chapter 7 bankruptcy in July 2017. Rather than restructuring its debt through Chapter 11, the company opted for liquidation through Chapter 7.
By making this decision, many people, including those who had already placed an order, were left scrambling in search of a last-minute wedding dress. The company’s decision to opt for Chapter 7 bankruptcy resulted in its immediate closing of all stores.
True Religion Accumulated A Lot Of Debt
True Religion established itself as a premium denim retailer, but that didn’t stop the company from running into financial issues that resulted in Chapter 11 bankruptcy in July 2017. In addition to competitors eating away at its sales, the company was struggling with mounting debt.
Even though True Religion closed nearly 30 of its stores, many remained open post-bankruptcy. When combined with a larger digital footprint, the company has been able to maintain its market share in the crowded denim space.
Rue21 Is Bouncing Back
Rue21 is one of the biggest names on this list, thanks to the fact that the company closed more than 400 stores as the result of its May 2017 Chapter 11 bankruptcy filing. At that time, the company reduced its debt load, reorganized its structure, and took on outside capital in an attempt to save the brand
Rue21 is one of the success stories of the retail industry downturn that claimed so many other brands. It came out of bankruptcy healthier than most, thus allowing it to maintain its highest-performing stores while focusing more heavily on establishing an online presence.
Vanity Laid Off 1,400 Workers
Some companies file for bankruptcy, reorganize, and then take the market by storm once again. Others, such as Vanity, have no choice but to close its doors for good. Before filing for Chapter 11 bankruptcy in 2017, Vanity had nearly 150 physical stores in states throughout the country. However, due to its financial concerns, bankruptcy was imminent, along with the termination of more than 1,400 jobs.
Despite its past success, Vanity did not attempt to keep a web-only presence but instead liquidated its inventory via a going out of business mega sale.
BCBG Was Bought Out
At its height, BCBG was one of the top players in the women’s apparel industry. Its distinct brand and large offering of special occasion dresses attracted buyers from far and wide. But even with a large following and many years of success, BCBG declared for bankruptcy in 2017.
This resulted in a purchase by Marquee Brands and Global Brands Group Holding Ltd. In addition to some standalone stores, BCBG also has a large presence in many Macy’s stores throughout the United States, Canada, Indonesia, and Puerto Rico.
Wet Seal Went Downhill
Wet Seal achieved big-time success for many years, but their run at the top came to an end with its bankruptcy filing in February 2017 (its second after a 2015 filing and subsequent buy out by Versa).
After securing bankruptcy protection early in 2017, the brand closed more than 300 stores across the country. And if that wasn’t sad enough, the company was purchased by investment firm Gordon Brothers for only $3 million. Today, Wet Seal still exists, but purchases can be made online only. You won’t find any of its famous storefronts in local malls.
The Limited Is Undergoing Rebranding
After a long, successful run at malls all over the country, The Limited filed for bankruptcy in January 2017. In addition to fierce competition from up and coming fashion brands, The Limited struggled with low sales as a result of declining mall traffic. After its Chapter 11 filing, private equity firm Sycamore Partners stepped in to save and rework the brand.
While all of its original stores (more than 250) were closed, the new ownership group has plans to bring it back to life as a plus-size brand, both online and in physical locations throughout the United States.
American Apparel Had Several Issues
In late 2015, American Apparel – and its made-in-America approach to apparel – had no choice but to file for Chapter 11 bankruptcy. Mounting debt, declining sales, and internal power struggles led it down this path.
By the next year, American Apparel emerged from bankruptcy in a better place, thanks to its new ownership group of Monarch Alternative Capital LP. In early 2017, the American Apparel brand was acquired by Gildan Activewear for $88 million. However, the deal did not include any of its physical storefronts, so your only option is buying clothes from this once-proud brand online.
Aeropostale Is Bouncing Back
There was a time in the late 1990s and early 2000s when teenagers everywhere were wearing Aeropostale. Unfortunately, by May 2016, the famous teen retailer was no longer able to maintain its financial stability. Despite the fact that it kept more than 230 stores after bankruptcy, the company was forced to shutter many others.
On the plus side, mall operators Simon Property Group and General Growth took over the company after bankruptcy, and they were successful in reopening a large number of closed stores. When combined with a major rebranding effort, Aeropostale is once again on stable ground.
Destination Maternity Reached Its Final Destination
Formerly known as Mothers Work, Inc., Destination Maternity was once the world’s largest designer and retailer of maternity clothing. Based in Moorestown, New Jersey, as of November 2018, Destination Maternity had 1,108 locations in the United States, Canada, and Puerto Rico, along with 474 stores under different names and 634 leased department stores.
However, on October 21, 2019, Destination Maternity filed for Chapter 11 Bankruptcy and said they would be closing 183 stores. As of its filing, it carried $244 million in debt.
Forever 21 Pulled Out Of Numerous Countries
Forever 21 is a fast fashion retailer with its headquarters in Los Angeles, California. It began as Fashion 21 in 1984, and has grown to become a household name. Known for trendy styles and cheap pricing, the company has had its fair share of controversies in the past, as well as financial issues as well.
In September 2019, Forever 21 filed for Chapter 11 Bankruptcy and decided to close hundreds of stores in order to restructure. Although the company states it will not be going out of business, it is shrinking, withdrawing from 40 counties where it once had stores.
Barneys New York
Founded in 1923 in New York City, Barneys New York Inc. is an American luxury department store. They carry major luxury brands such as Armani, Christian Louboutin, among many others. Yet, in August 2019, the company filed for Chapter 11 Bankruptcy and announced that they have liquidation sales in numerous of their stores.
Although the store plans to stay open for the next year, they are selling off inventory as the licensing company Authentic Brands takes over ownership. However, this wasn’t the first time Barneys have experienced financial troubles. The company had previously had filed for bankruptcy in 1996.
Avenue Went From A Chapter 11 Bankruptcy To A Chapter 7
Avenue Stores LLC is a retailer in the United States that specializes in selling plus-size women’s clothing. They have a large demographic ranging from ages 25 to 55 with sizes going from 14 and up.
In August 2019, the company filed for Chapter 11 Bankruptcy although later changed to Chapter 7. CFO David Rhoads blamed the bankruptcy on the new competition in the plus-size space, with plus-size options being available at a variety of other typical clothing stores.
Charming Charlie Lost It’s Shine
Based in Houston, Texas, Charming Charlie is a women’s fashion and accessory retailer that was founded in 2004 by Charlie Chanaratsopon. Known for everything being organized by color, Charming Charlie offered a variety of products ranging from accessories to beauty gifts.
After filing for Bankruptcy in 2017, resulting in the closing of 100 store, the company filed for a second time in July 2019, with another 250 stores closing. After selling its intellectual property for $1 million at auction, Charming Charlie announced it would be opening 15 stores in 2020.
Sonia Rykiel Died Shortly After Its Founder
Sonia Rykiel wa a French fashion designer at writer. She’s credited with designing the highly popular Poor Boy Sweater, and earned the nickname as the “Queen of Knits.” She founded the Sonia Rykiel label in 1968, selling clothes, accessories, and fragrances. Unfortunately, she passed away on August 25, 2016.
In April 2019, Sonia Rykiel filed for Chapter 7 Bankruptcy, leading to the closing of her stores in New York as well as France. In July 2019, the company closed all its stores and was liquidated.
Roberto Cavalli Was Sold To A Dubai-Based Real Estate Developer
Born in 1940, Roberto Caballi is an Italian fashion designer and inventor. He’s credited with creating the sand-blasted style of jeans, and is known for his unusual prints on clothing. His fashion house sells luxury clothing, perfume, and other expensive accessories.
However, in April 2017, the company filed for Chapter 7 Bankruptcy for its US division, known as Art Fashion Corp. This resulted in the closing of all American stores and the firing of all 100 employees. The company was then bought by Hussain Sajwaini, a Dubai-based real estate developer.
Sears Lasted For A Long Time
Although Sears sells a variety of products, they are also known for their apparel section as well. Founded by Richard Warren Sears, the company began opening retail locations in 1925. In the 1980s, Sears was the largest retailer in the United States until being surpassed by Walmart and Kmart in 1990.
Yet, after years of financial struggles, the company filled for Chapter 11 Bankruptcy protection in October 2018. In 2019, unprofitable stores were closed, and changes were geared toward personalizing the customer service experience.
National Stores Inc. Had A Falling Out
Headquartered in Harbor Gateway in Los Angeles, National Stores Inc. is a family owned company with 344 locations in 22 states, Puerto Rico, and employing more than 9,800 people.
Doing business as a variety of names such as Fallas, the company offers brand name and private label clothing to men and women of all ages, along with household items. After filing for Chapter 11 Bankruptcy protection in 2011, the company had plans to close 74 of its 344 stores. Currently, they’re working to stay afloat.
Charlotte Olympia Went Up In Smoke
Founded by Charlotte Olympia Dellal in 2008, Charlotte Olympia is a British luxury shoe and accessories brand. The company’s designs are inspired by classic Hollywood cinema from the 1940s to the 50s.
In February 2018, the company filed for Chapter 11 Bankruptcy, citing for the “unprecedented disruption in the retail market.” The company’s assets were only worth around $3 million, owing $20 million in debt. Charlotte Olympia ended up closing all four of its stores in the United States.
Bon-Ton Had A Good Run
Bon-Ton Holdings Inc. is an American online retailer that was once a department store chain that was founded in 1898 as a dry goods store on Market Street in York, Pennsylvania. Because of declining sales and difficulties competing with e-commerce, Bon-Ton filed for Chapter 11 Bankruptcy in February 2018.
Riddled with debt, the company was having a hard time competing with small stores, not to mention bigger companies such as Macy’s. With only a little over 40 stores, there have been talks about selling.
Yogasmoga Closed All Stores But One
Yogasmoga is a New York City-based activewear company that prided itself on its flashy design and modern styles. In December 2016, it filed for a Chapter 11 Bankruptcy on top of an involuntary Chapter 7 Bankruptcy in the previous month by three creditors who claimed were owed $3.2 million.
At the time of the filing, the company had around 50 to 99 creditors with the company’s assets being anywhere from $1 million to $10 million. This resulted in the company shutting all of its doors except one location in La Jolla, California.
Nasty Gal Had An Impressive Start
A fashion retailer that specializes in clothing for young women, Nasty Gal was founded by Sophia Amoruso in 2006 and was named the “Fastest Growing Retailer” by INC Magazine in 2012. In November 2016, the company filed for Chapter 11 Bankruptcy.
In 2012, the company hit $100 million in sales but slowly began to drop in the following years by the tens of millions. In desperation, the company sold its brand name and other intellectual property for $20 million to a rival fashion site based in the UK.
PacSun Used To Be The Go-To For Teenagers
Pacific Sunwear or PacSun, is a retail clothing brand that is geared towards youth interested in action sports of all kinds. It was founded by Jack Hopkins and Tom Moore in 1982 and can be traced back to a surf shop in Seal Beach, California.
Headquartered in Anaheim, California, as of 2017, the company had over 600 stores across the United States and Puerto Rico. In 2016, the company went bankrupt and was bought by Golden Gate Company in San Francisco. This was the third time the company had filed for bankruptcy.
Joyce Leslie Sold Everything
Joyce Leslie is a woman’s clothing retailer in the New York metropolitan area with 47 stores. In January 2016, the company filed for Chapter 11 reorganization. According to the court, the company lacked a “sophisticated e-commerce platform to compete in today’s market.”
With assets and liabilities between $1 million and $10 million, the company liquidated all of their assets and sold their intellectual property, store leases, and the lease of its corporate office and distribution center.
Quicksilver Had Its Time In The Sun
Quicksilver is a surf-inspired apparel and accessories brand that was founded in Torquay, Australia in 1969, although it is currently based in Huntington Beach, California. One of the first surfwear companies to go public in 1986, it struggled in the wake of fast fashion.
The company ended up opening too many stores and relying too heavily on their surf-style clothing. this resulted in them declaring bankruptcy in September 2015, restructuring around $800 million in debut and becoming private under Oaktree Capital. In 2017, the company re-branded as Boardriders Inc.
Frederick’s Of Hollywood Was Bought Out And Turned Into An Online-Only Store
Frederick’s of Hollywood is a retailer of women’s lingerie in the United States, with stand-alone stores and in malls across the country. However, the company filed for Chapter 11 Bankruptcy in April 2015, claiming that increased competition and decreased mall shopping brought about its end.
The business had not made a profit since 2007 and had $106 million in liabilities. Frederick’s was then purchased by Authentic Brands Group for $22.5 million, which turned it into an online-only business.
Karmaloop Was Bought Out Of Bankruptcy
Founded by Greg Selkoe in 2000, Karmaloop is a multi-platform retailer, specializing in streetwear. However, 15 years after its inception, Karmaloop filed for Bankruptcy in March 2015 with $100 million in debt.
Once a popular e-commerce website, a slue of failed business ventures lead to its collapse, including a $14 million attempt to break into the television industry. In May of that year, Comvest Capital and CapX Partners bought the company out of bankruptcy for around $13 million. The company was then sold to Shiekh Shoes a year later.
Caché Closed Hundreds Of Stores
In 2015, Caché, a retailer for women’s clothing filed for Chapter 11 Bankruptcy, citing a lack of time and money not allowing them to properly reorganize the company. During the filing process, the store claimed that it would remain open and continue to run the business.
However, they were forced to close over 200 of their stores and even renegotiate some of the leases. in total, the company received around $22 million in financing from Salus Capital Partners in order to remain in business during the process.
City Sports Couldn’t Keep Up
City Sports in an American sports apparel retail store. In October 2015, the company filed for bankruptcy after being unable to compete with other retailers. This resulted in City Sports liquidating all of its assets and closing over two dozen stores nationwide.
It was then bought by the Sonnek-Schmelz brothers, who also owned the chain Soccer Post. In April 2017, it announced that the store was going to be relaunched to sell online goods as well as opening stores in Boston, New York, Washington D.C., and Philadelphia.