Biggest retail bankruptcies of 2020

Let’s recall the biggest losses the retail industry faced this year


Biggest retail bankruptcies of 2020. Source:

Non-essential retail and the hospitality industry have suffered the most in 2020. Nationwide lockdowns, laid-off prospective customers, reduced demand for smart clothing, and the limits to the number of people a physical location can admit – this all led to a raft of outrageous headlines. Major retailers have gone bankrupt.


Due to the forced lockdown closures, JCPenney missed a $12 million interest payment on April 15. The company was given a 30-day-long grace period, but couldn’t find another solution except for filing for bankruptcy under Chapter 11. This involved a reorganization of the retailer’s business affairs, debts, and assets.

After JCPenney reached an agreement on a financial restructuring plan to navigate the Coronavirus (COVID-19) pandemic, they started to gradually reopen brand stores. The company announced it received approvals from the U.S. Bankruptcy Court for the “First Day” motions, including access to approximately $500 million in cash collateral. The second-day phase would imply access to the $900 million in debtor-in-possession (“DIP”) financing that it received from its existing first-lien lenders, which includes $450 million of new money.

At the same time, experts don’t expect this agony of reorganization to bring long-term survival to the company that hasn’t had a profitable year since 2010.

We're certainly not going to see customers return in droves. They're not shopping for clothing and accessories that JCPenney depends upon. And if they are, they're not likely to be shopping at JCPenney or at the malls where they're located. I know that Walmart (WMT) and Target (TGT) have grabbed market share for apparel and accessories, and they're not giving that back
Mark Cohen, the director of retail studies at Columbia University

Meanwhile, the retailer is not giving up just yet. JCP signed an asset purchase agreement with Simon Property Group (SPG) and Brookfield Asset Management. It also signed agreements with a majority of its lenders, giving the company the ability to move ahead and plan an exit from the Chapter 11 bankruptcy proceedings.

Neiman Marcus

Neiman Marcus, an iconic American store, was one of the first famous brands to report bankruptcy this year. With a concentration of stores in Texas, it has been hit especially hard as a steep decline in oil prices sapped the buying power of its wealthy customers.

The brand that prospered for over 100 years was forced to shut all of its 43 brand locations, roughly two dozen Last Call stores, and its two Bergdorf Goodman stores in New York. The majority of its 14,000 employees were furloughed during the lockdown.

Neiman Marcus pondered a lot before officially announcing it had filed for bankruptcy. The brand had to change its board of directors and close some locations for good. However, already in September, it had completed its Chapter 11 bankruptcy protection process, emerging from the collapse. Its restructuring plan eliminated more than $4 billion of debt and $200 million of annual interest expense.

The company’s new owners, which include PIMCO, Davidson Kempner Capital Management, and Sixth Street Partners LLC are funding a $750 million exit financing package that fully refinances its debtor-in-possession loan.

I feel really good. It’s an important moment for the industry because we generate so much revenue for the thousands of brands that we represent. Not only do we have business continuity, we now have the best balance sheet in the business. The rest of this year will be challenging, but it’s a really high moment
Geoffroy van Raemdonck, Neiman Marcus’s chief executive since 2018

Brooks Brothers

Over 200 years of successful operations, the brand name associated with business and style, 40 US presidents, and numerous Wall Street bankers on the customer list… It all went down the drain when Coronavirus came along.

The famous and respected menswear retailer filed for Chapter 11 in July. The company had previously warned it would lay off nearly 700 workers in three states and was seeking a buyer for its business. According to the bankruptcy filing, Brooks Brothers has secured $75 million in financing to continue operating.

In August, Brooks Brothers representative said the company would be sold to Simon Property Group, the biggest mall operator in the United States, and Authentic Brands Group, a licensing firm. The new owners have committed to continue operating at least 125 Brooks Brothers retail locations.

Lord & Taylor

Another veteran of fashion retail filed for bankruptcy in early August. At the time of the filing, the retailer’s executive team still hoped to find a buyer that could “keep the heritage of the brand alive for years to come.” Sadly, the dream never came true and Lord & Taylor decided to close all 38 remaining stores as well as the online storefront.

In August, it announced it was going out of business. Ultimate sales at the soon-to-close stores began on August 27 and have been managed by liquidators Hilco Merchant Resources and Gordon Brothers. They include sales on inventory and the sale of in-store fixtures, furniture, and equipment. The stores are supposed to be closed once the assets are sold out.

While we are still entertaining various opportunities, 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 officer

As Lord & Taylor filed for bankruptcy, the firm handling the retailer’s liquidation sale was granted permission to supplement the brand original stock with its own goods “of similar high quality”, so the stores may cater to customers’ needs for at least this holiday season.

On October 15, the Saardia Group LLC purchased Lord & Taylor’s trademark, social media accounts, customer data, and other intellectual property for $12 million at a bankruptcy auction. Apparently, they are going to leave the website functioning as the fine print reads: “Our stores are closing. will be back.”

Therefore, loyal customers can only hope for a new experience under the name of their favorite brand.


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