These Retailers Could File for Bankruptcy in the Next Few Weeks

The list of retailers on bankruptcy watch continues to expand.

Amid the coronavirus pandemic, federal regulations had forced the closures of nonessential stores for several weeks, jeopardizing brick-and-mortar traffic and threatening many companies’ bottom lines.

Over the past couple months, a number of nationwide chains have made headlines for exploring financial options including reorganizing debt and liquidating properties. And while the health crisis could be the final nail in the coffin, the writing has been on the wall for these retailers — from JCPenney to Stage Stores — for some time.

Here, FN rounds up the companies that might be on their way to a Chapter 11 filing in the coming weeks.

Ascena Retail Group

Ascena Retail Group is reportedly exploring a bankruptcy filing in an effort to manage its debt load and rework its finances. The retailer — parent to Ann Taylor and Lane Bryant — is said to be in talks with lenders as majority of its stores remain closed due to the coronavirus health crisis. A Bloomberg report indicated that the company, which is looking for alternative financing options, could file for Chapter 11 protection as early as July.

The New Jersey-based group, which owns roughly 2,800 units across the country, shuttered almost its entire brick-and-mortar fleet in mid-March amid government-mandated lockdowns. It began reopening locations in May and currently has 450 outposts back in business, albeit at reduced hours. In a recent filing with the Securities and Exchange Commission, it noted that foot traffic is “significantly reduced” compared with the same period last year.


In early May, Francesca’s warned that it could go bankrupt as the coronavirus continues to batter its business. Its year-end filing with the Securities and Exchange Commission showed that pandemic has adversely affected the Houston-based retailer’s cash flow, raising “substantial doubt about our ability to continue as a going concern.” The inclusion of a going concern qualification in its report, acknowledged the company, violates certain covenants in agreements with its lenders.

If it is unable to raise additional capital or secure debt or equity financing, Francesca’s said that it “may be required to delay, reduce and/or cease our operations and/or seek bankruptcy protection” to implement a restructuring plan. The company also noted in the report that it had failed to pay rent on some of its leased locations for the month of April — again violating its loan covenants. (It planned to forgo rent payments for May and June.)

Lord + Taylor

News of a potential Lord + Taylor bankruptcy followed shortly after reports in early April suggested that the century-old retailer was seriously considering a post-pandemic liquidation. At the time, the chain — owned by fashion rental service Le Tote — had seen the bulk of its executive team resign, including president Ruth Hartman. The parent company also confirmed to FN that it had implemented “significant companywide layoffs” across both Le Tote and Lord + Taylor “with only key employees remaining to preserve the business.”

What’s more, a Reuters report last month suggested that the company was preparing to clean out inventory in its 38 units when restrictions ease enough to allow nonessential stores to resume operations. It reportedly expects the permanent closures of all of its outposts when the merchandise is sold.

RTW Retailwinds

With a potential bankruptcy filing on the horizon, New York & Co. parent RTW Retailwinds has warned that it could close all of its stores across the country. The apparel and accessories company wrote in a filing this week with the Securities and Exchange Commission that the coronavirus pandemic — which forced the two-month shutdown of its brick-and-mortar fleet and subsequently halted in-store traffic — had materially adversely impacted its cash flow. It raised “substantial doubt” about its ability to continue as a going concern.

“The company may not be able to mitigate the impact COVID-19 has had and will have on its business,” it said, “and has been considering available options, including restructuring its obligations or seeking protection under the bankruptcy laws, in which case there will likely not be any value distributed to its shareholders and its shares could be cancelled for no consideration.” Should it file for Chapter 11 protection, the company said that it could shutter more than 150 locations or even its entire fleet of 387 outposts, including 116 outlets, in 33 states.

Tailored Brands

Tailored Brands — parent to Men’s Wearhouse, Jos. A. Bank, Moores Clothing for Men and K&G — wrote in a recent filing with the Securities and Exchange Commission that the coronavirus crisis has caused “significant disruptions” to its day-to-day operations.

Since mid-March, many of the Houston-based company’s stores, as well as its corporate offices, were temporarily closed in accordance with government-mandated lockdowns. Tailored Brands made the decision to furlough more than 95% of its workforce and implement salary reductions for senior-level executives. It also noted that both the market price of its common stock and total revenues had declined over the past couple months.

“If the effects of the COVID-19 pandemic are protracted and we are unable to increase liquidity and/or effectively address our debt position, we may be forced to scale back or terminate operations and/or seek protection under applicable bankruptcy laws,” it shared.

Retailers on Bankruptcy Watch That Have Already Filed for Chapter 11 Protection


JCPenney, which was founded 118 years ago, filed for bankruptcy on May 15. According to the filing, it had $500 million in cash at hand and received debtor-in-possession financing commitments of $900 million. It recently received court approval to access $450 million of new money from its first-lien lenders, $225 million of which will be drawn immediately.

The beleaguered retailer’s longtime struggles were compounded amid the coronavirus pandemic, which forced it to shutter scores of outposts across the country and furlough majority of its retail associates. Since government officials have eased lockdowns, JCPenney has reopened nearly 500 stores. As part of its plan to restructure, the company intends to reduce its store footprint, while focusing its resources on top-performing locations and its e-commerce business.

Neiman Marcus

After weeks of speculation, the debt-saddled Neiman Marcus filed for Chapter 11 protection on May 7. The luxury chain said it has secured $675 million in financing from creditors to continue operations during the bankruptcy process. (Mytheresa, the luxury e-commerce platform owned by NMG, is not included in the restructuring.) It owes millions of dollars in unsecured claims to boldface brands like Chanel, Dolce & Gabbana and Gucci.

The retailer — which operates its namesake banner, as well as its Last Call outlets and department store Bergdorf Goodman — has struggled in recent years amid digital disruption and reduced foot traffic. Two years ago, it announced a four-year transformation plan centered on omnichannel and supply chain technology investments.

Stage Stores

On May 11, Stage Stores filed for Chapter 11 protection, citing estimated liabilities of between $500 million and $1 billion versus estimated assets in the same range. The company operates 738 locations across several banners, including Gordmans, which it acquired out of bankruptcy, as well as Bealls, Goody’s and the Stage name.

“Over the last several months, we had been taking significant steps to attempt to strengthen our financial position and find an independent path forward,” said president and CEO Michael Glazer. “However, the increasingly challenging market environment was exacerbated by the COVID-19 pandemic, which required us to temporarily close all of our stores and furlough the vast majority of our associates. Given these conditions, we have been unable to obtain necessary financing and have no choice but to take these actions.”

Access exclusive content