A post-pandemic liquidation could be in store for Lord + Taylor.
The iconic chain is reportedly preparing to liquidate its stores as soon as they reopen. According to an exclusive report from Reuters, which cited people familiar with the matter, the century-old retailer is planning to clean out inventory in its 38 units when restrictions ease enough to allow nonessential stores to resume operations.
Sources who spoke with the media outlet added that Lord + Taylor had already lined up liquidators to help it run going-out-of-business sales. It reportedly expects the permanent closures of all of its outposts when the merchandise is sold.
Lord + Taylor declined to comment for this story.
Reports of an imminent Lord + Taylor bankruptcy amid the coronavirus crisis date back to early April. A source close to the company told FN at the time that the retailer had laid off the majority of its merchants; saw the bulk of its executive team resign, including president Ruth Hartman; and is seriously considering liquidating its business.
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What’s more, the source added that the small number of associates and store operations teams who were furloughed had been retained to see the company through potential liquidation sales after stay-at-home orders are lifted. Its parent company, fashion rental service Le Tote, confirmed to FN in early April that it had implemented “significant company-wide layoffs” across both Le Tote and Lord + Taylor “with only key employees remaining to preserve the business.”
Before announcing plans to sell Lord + Taylor to Le Tote for $75 million in late August, previous owner Hudson’s Bay Co. had struggled for some time to revive the mid-tier department store chain amid declining comps. HBC memorably shuttered Lord + Taylor’s 100-year-old flagship on New York’s Fifth Avenue last year, as well as closed another 10 of its 48 stores and dabbled in a number of omnichannel initiatives, including an unexpected digital partnership with Walmart in 2018.
As it inches toward a potential bankruptcy, Lord + Taylor is also said to be weighing other options, such as seeking relief from creditors or looking for more funds. Reuters’ sources said it remained possible that the retailer could secure external financing.
Over the past month, a number of nationwide chains have made headlines for exploring financial options including reorganizing debt and liquidating properties: JCPenney and Neiman Marcus have joined an expanding list of retailers on bankruptcy watch, and just this week J.Crew began Chapter 11 proceedings in order to restructure its debt and reposition its brands for the long term.