Retail

Payless To Shut Down Stores After Second Bankruptcy Filing

Payless To Shut Down Stores After 2nd Bankruptcy

Payless ShoeSource will close all of its stores when it files for bankruptcy for a second time later this month.

Sources told Reuters that the U.S. discount retailer will shut down its approximately 2,300 stores after it was unsuccessful in finding a buyer.

This would mark the second time that Payless has filed for bankruptcy. The last time was in April of 2017, which led to the closure of 800 stores and CEO W. Paul Jones stepping down. The retailer was, however, able to exit bankruptcy still open for business, getting around $400 million in loans and cutting its debt by more than $800 million. Since then, it has closed down another 400 stores, and currently employs 2,700 in North America.

In January, it was reported that Payless had hired an advisor, PJ SOLOMON, to help it avoid a second bankruptcy filing. At the time, the retailer was reportedly looking at selling or restructuring the company, as well as closing one third or more of its retail stores.

The sources pointed out that there is a chance a buyer could be found after the retailer files for bankruptcy. For now, the company is making plans to run going-out-of-business sales at its locations in the next week.

Payless is the latest retailer to face bankruptcy. Toys R Us shuttered all of its stores in the U.S., Australia and the U.K last year, but might be making a comeback.  “That’s certainly our intent, to be in a position where U.S. consumers can engage with Toys R Us and Babies R Us again this holiday season,” said Tru Kids Inc. Chief Executive Officer Richard Barry, adding that “a significant amount of market share has been left on the table.”

The brand could potentially have pop-up shops, eCommerce or brick-and-mortar stores, with the goal of having locations that combine offline and online experiences.

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