Charming Charlie To Close All 261 Stores After 2nd Bankruptcy In Two Years
Another retailer is going bust: Charming Charlie Holdings plans to close its remaining 261 stores after filing for bankruptcy protection for the second time in as many years. The clothing and accessories seller on Thursday said it had stopped online sales and expects to conclude its going-out-of-business sales by the end of August.
Privately-held Charming Charlie, which had stores and operations in 38 states, shuttered about 100 stores during its prior bout in Chapter 11 bankruptcy, which began in December 2017 and lasted until April 2018. That effort at restructuring its operations and debt "were simply not sufficient to stabilize the debtors' businesses and ensure long-term profitability," according to its latest bankruptcy filing.
The company estimated having about $19.8 million in gift cards outstanding, and expects roughly $7.8 million of that to be redeemed. It asked the bankruptcy court for permission to honor gift cards for 30 days.
Charming Charlie, which has $82 million in debt and employs about 3,300 people, also cited "significant headwinds given the continued decline of the bricks-and-mortar retail industry." It also faulted the impact of trade tariffs for reduced consumer spending, as well as poor weather earlier in the year for keeping would-be shoppers at home.
Founded in 2004, Charming Charlie was known for arranging its merchandise by color, with its array including as many as 26 hues.
The Houston-based company on Thursday reported having about $6,000 in cash on hand and said its planned liquidation sales would bring in $30 million in revenue. Second Avenue Capital and White Oak Commercial Finance is providing $13 million in debtor-in-possession financing to fund the company's operations through the latest bankruptcy.
The retailer's demise is the latest in a string of such failures, and comes two months after Dress Barn said it would its roughly 650 stores, and a year after Toys R Us closed shop