This 132-Year-Old Beloved Department Store Could Be Doomed
Vendors claim they haven't been paid, leading many to worry about the store's longevity.
Yet another retail chain may soon be shutting its doors amid the coronavirus pandemic. Regional department store Belk may be in trouble, according to a new report from Forbes that claims multiple Belk vendors say they're not being paid in a timely manner—if at all. Vendors are also reporting that many of their contacts at the store are issuing limited communications, with some going completely radio silent.
Belk was founded by the Belk family, who started the chain with a single store in their native North Carolina in 1888. The business has since expanded to 291 retail locations across 16 states in the Mid-Atlantic and South. The business remained largely family-run until 2015, when private equity firm Sycamore Partners purchased Belk for $3 billion.
According to a July 2020 report in the New York Post, Sycamore Partners had initially planned to merge Belk with JCPenney, which filed for bankruptcy on May 15. However, those plans seem to have since fallen through.
Even before coronavirus lockdowns began stateside, indications of Belk's financial troubles were apparent. In February 2020, Belk announced the elimination of 80 jobs at its corporate headquarters in Charlotte, North Carolina.
In March, with coronavirus spreading rapidly throughout the U.S., Belk closed all of its retail stores from March 17 until early May. Just two months after reopening, the chain announced additional layoffs in July, although the company did not specify the number of affected employees. "In order to weather the impacts of COVID-19, Belk has had to make some of the most difficult decisions of its 130-year history," the company said in a statement.
While Belk has not yet officially announced store closures, vendors tell Forbes they're "not optimistic" about the situation. Of course, Belk isn't alone in its struggle to keep its doors open amid the global economic crisis. Read on to discover which stores have already begun closing amid COVID. And for more store closure news, This Beloved Discount Store is Closing All of Its Locations.
Lord & Taylor
On Aug. 27, department store Lord & Taylor, which has 38 stores across the United States, announced that it had filed for bankruptcy and would be shuttering all of its stores for good. "We believe it is prudent to simultaneously put the remainder of the stores into liquidation to maximize value of inventory for the estate while pursuing options for the Company's brands," Ed Kremer, the company's chief restructuring office, said in a statement. And for more store closure news, This Beloved Retail Chain Could Be Closing a Store Near You.
Neiman Marcus was an early casualty of the coronavirus pandemic, filing for Chapter 11 bankruptcy protection in May of 2020. In a statement, representatives for the department store said that COVID-19 closures had "placed inexorable pressure on our business," with Business Insider reporting in August that the chain would close 22 of its locations.
As a result, the luxury retailer emerged from the Chapter 11 bankruptcy process on Sept. 25. "With the successful implementation of our restructuring, Neiman Marcus and Bergdorf Goodman will continue to be the preeminent luxury shopping destinations for years to come," Chief Executive Geoffroy van Raemdonck said in a statement.
Though many Nordstrom stores are still alive and well, the company announced in May that it would be closing 16 of its department stores in addition to all three of its Jeffrey stores, which sold high-end designer goods. However, Business Insider reports that the company's discount arm, Nordstrom Rack, will not be affected by the closures. And for more up-to-the-minute retail news, sign up for our daily newsletter.
Discount retailer Stein Mart announced the closure of its 280 stores in September, just a month after filing for Chapter 11 bankruptcy protection. On Sept. 14, A&G real estate partners, the firm tasked with marketing the defunct locations, announced that it was actively seeking new tenants for the shuttered stores. And for more insight into which stores could be leaving your area, This Beloved Department Store Just Announced It's Closing All Locations.
Discount department store Century 21 announced on Sept. 10 that it would be closing its 13 locations in New York, New Jersey, and Pennsylvania after close to 60 years in business. The store's representatives didn't mince words regarding their feelings on the closures, either. "Our insurers, to whom we have paid significant premiums every year for protection against unforeseen circumstances like we are experiencing today, have turned their backs on us at this most critical time," Century 21 co-CEO Raymond Gindi said in a statement.
Bed Bath & Beyond
Beloved housewares giant Bed Bath & Beyond announced that it would be shuttering 200 of its retail locations—approximately 20 percent of its stores in the U.S.—over the next two years.
"The impact of the COVID-19 situation was felt across our business during our fiscal first quarter, including loss of sales due to temporary store closures and margin pressure from the substantial channel shift to digital," said the store's CEO, Mark Tritton, in a July 8 statement.
Another casualty within the home goods sector, Pier 1 announced its bankruptcy filing on May 20, 2020. "The challenging retail environment has been significantly compounded by the profound impact of COVID-19, hindering our ability to secure such a buyer and requiring us to wind down," the brand's CEO and CFO Robert Riesbeck said in a statement. Pier 1 is currently in the process of closing all of its 540 U.S. retail locations by the end of October.
Sur La Table
Kitchen goods store Sur La Table filed for Chapter 11 bankruptcy in July, announcing that it would be closing more than half of its 121 stores. On Sept. 11, the company announced that it would be shuttering an additional 17 stores; USA Today reports that 63 locations are already listed as permanently closed.
On Sept. 22, candy store It'Sugar, which operates approximately 100 stores throughout the U.S., filed for Chapter 11 bankruptcy protection. "The effects of the COVID-19 pandemic on demand, sales levels, and consumer behavior, as well as the recessionary economic environment, have had a material adverse effect on It'Sugar's business, results of operations and financial condition," Jarett Levan, president of It'Sugar holding company BBX Capital Corporation and BBX Capital Florida, LLC, explained in a statement.