Claire’s Declares Second Bankruptcy Amid Brick-and-Mortar Shopping Drop

Kid-friendly accessories retailer Claire’s is declaring bankruptcy for the second time in seven years.

The long-time mall staple said in a Wednesday (Aug. 6) press release that its stores will remain open as it seeks Chapter 11 bankruptcy protection.

“This decision is difficult, but a necessary one,” Claire’s CEO Chris Cramer said in the release. “Increased competition, consumer spending trends and the ongoing shift away from brick-and-mortar retail, in combination with our current debt obligations and macroeconomic factors, necessitate this course of action for Claire’s and its stakeholders. We remain in active discussions with potential strategic and financial partners and are committed to completing our review of strategic alternatives.”

The company previously filed for bankruptcy in 2018, closing several dozen stores.

While the press release did not mention tariffs, Claire’s, like many retailers, relies on sourcing products from places like China, which are facing steep levies imposed by the President Donald Trump administration.

Claire’s has a $496 million loan due in December 2026, CNN reported Wednesday. The company ceased paying rent on some stores in June and July, Bloomberg reported Monday (Aug. 4).

The bankruptcy is “no surprise,” said Neil Saunders, managing director of GlobalData, per the CNN report, adding that Claire’s has been suffering with a “cocktail of problems, both internal and external, that made it impossible to stay afloat.”

The retailer hasn’t kept pace as competition has grown “sharper and more intense over recent years,” Saunders said, per the report. Rivals are “more attuned to what younger consumers want, [which] has left Claire’s looking somewhat out of step with modern demand.”

Contrary to sentiments from Claire’s, Simon Property Group, the largest mall company in America, reported earnings Monday that showed 96% occupancy at its malls as of the end of June.

“The continued rise of eCommerce is no longer viewed as a death knell for physical retail but as a catalyst for transformation,” PYMNTS wrote. “Simon’s strategic equity stakes in digital platforms and hybrid retail operators … indicate a willingness to straddle both worlds. Consumers today aren’t choosing between online and in-person — they want both, seamlessly.”

PYMNTS Intelligence found that roughly 4 in 10 consumers are now Click-and-Mortar shoppers, meaning they prefer purchasing journeys that meld digital and physical over pure-play brick-and-mortar or eCommerce.