This Mall Favorite Just Filed for Bankruptcy
The company has been struggling to pay rent on its 100 locations across the country.
As the coronavirus pandemic continues to upend life throughout the U.S., reopened businesses have struggled to regain their footing. Some of the most well-known chains and long-lasting department stores have been forced to close their doors, unable to draw in enough customers to make their operations worthwhile. And this trend is unlikely to change anytime soon. In fact, the latest retail news might leave a sour taste in your mouth: It'Sugar, the candy franchise that operates about 100 locations across the country, has filed for bankruptcy.
On Sept. 22, BBX Capital Corporation announced that its popular candy store It'Sugar would be filing for Chapter 11 bankruptcy. According to the It'Sugar website, what was once the "largest and fastest-growing specialty candy retailer with 100 locations across the United States and abroad" is seriously struggling. Many of those locations are in malls, where the store has become an integral part of the shopping experience for anyone with a sweet tooth. But now, It'Sugar is in trouble.
"Unfortunately, it has become necessary for It'Sugar to make this filing, as 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 BBX Capital Corporation and BBX Capital Florida, LLC, said in a statement.
Per the statement, It'Sugar closed all of its stores in March on a temporary basis at the initial height of the coronavirus pandemic. Those stores reopened in June and July, but the company is still seeing a significant decline in sales. As Levan noted, approximately 60 percent of It'Sugar's sales were dependent on travel and tourism, which are still seriously lagging nationwide.
Given the franchise's current financial hardships, It'Sugar has stopped paying rent or only made partial payments to all of the stores' landlords—and they've obviously noticed. So far, the company has received notices of default on 49 retail locations, which is almost half of all the locations in the U.S.
If you're a fan of It'Sugar and are worried you won't be able to sample its sweets again, rest assured that the stores are not closing—at least, not yet. The future of It'Sugar is uncertain, but at the moment, BBX Capital Corporation hopes that the bankruptcy filing will help the company survive. "We believe that It'Sugar will be better positioned to successfully navigate the effects of the COVID-19 pandemic upon exiting from bankruptcy," Levan said.
Of course, It'Sugar is only the latest franchise struggling to stay afloat in dire economic conditions. Read on for more stores that have been forced to file for bankruptcy as a result of the coronavirus pandemic. And for establishments that won't recover from COVID, 60 Percent of These Closed Businesses Will Never Reopen, Says New Report.
Bed Bath & Beyond
In July, Bed Bath & Beyond announced they would be closing 200 stores over the next two years. CEO Mark Tritton said, "The impact of the COVID-19 situation was felt across our business during our fiscal first quarter." On Sept. 23, the company listed over 60 stores that would close before the end of 2020. And for more businesses that have been hit hard, check out these Beloved Stores That Are Disappearing From Your Town.
Stein Mart, a discount department store that has been serving customers for over a century, filed for Chapter 11 bankruptcy in August. On Sept. 14, the company said they would be shutting down all 280 of their stores, citing the negative effect of COVID on the retail environment.
Sur La Table
The home store Sur La Table filed for Chapter 11 bankruptcy protection in July and announced the closure of 51 stores amid the pandemic. On Sept. 11, they said an additional 17 stores would close, leaving 55 stores remaining, as reported by USA Today. And for another store that's struggling, The Most Popular Halloween Store Won't Reopen 90 Percent of Its Locations.
On Sept. 10, Century 21 announced a "wind down of its retail operations," and going-out-of-business sales at their 13 locations. Co-CEO Raymond Gindi acknowledged that "retailers across the board have suffered greatly due to COVID-19." And for more department stores that are no longer with us, revisit these 17 Once-Beloved Department Stores That Are Now Defunct.
Lord & Taylor
The oldest department store in the country buckled under the weight of the pandemic. On Aug. 27, Lord & Taylor filed for Chapter 11 bankruptcy and announced the imminent closure of all 38 of the company's stores.
Nordstrom fans can breathe a sigh of relief knowing that Nordstrom only closed a total of 19 of its 116 stores, as reported by Business Insider on May 20. That's still a significant loss, and another casualty of the pandemic. And if you are going shopping during coronavirus, make sure you know The No. 1 Worst Thing You Can Do While Shopping Right Now.
"The challenging retail environment has been significantly compounded by the profound impact of COVID-19," Pier 1 chief executive office and chief financial officer Robert Riesbeck said on May 19, when the company filed for bankruptcy and announced that they would be closing all of their stores.
Neiman Marcus was the first department store to file for bankruptcy due to coronavirus, as NPR reported on May 7. According to Business Insider, the company has closed 22 of its locations thus far. And for more up-to-date information, sign up for daily newsletter.