Say Good Bye To Lord & Taylor

almost 4 years ago

We are already seeing some retailers filing for bankruptcy. Of the ones who entered so far, they are all using Chapter 11 which means they are going to reorganize.

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Lord & Taylor is about to change that.

The company is on an expanding list of retailers that analysts believe will not survive the shutdown due to the coronavirus. Now, it is all but certain the chain is gone.

Founded in 1826, the company is going to liquidate its inventory once the lock down is lifted. That means the company is going to open up stores only to shut them down again.

This move was expected since employees were laid off and much of the executive team resigned. The company is working with liquidators in an effort to get rid of its existing inventory. It will close the stores once the liquidation is completed.

On Monday, J. Crew filed for bankruptcy protection although it hopes to avoid liquidation. Lord & Taylor is not even exploring that option.

It is a move that is also going to affect some shopping malls around the country. While the company only has 38 stores at this point, they are large department stores that usually are flagship renters for malls. When those store close, clauses in other tenets leases kick in, allowing them to leave.

So far, since the crisis started, 30 million people filed first time unemployment claims. While many expect that number to drop when the economy reopens, news such as this shows that not all jobs are coming back. All those who were employed by Lord & Taylor who were laid off will not be returning to the company.

The retail sector was under fire for the better part of a decade. Brick and Mortar stores have seen their sales disappear to online retailers. Amazon was the main beneficiary although, of late, Wal-Mart and Target found success in the digital world.

Department stores are also feeling a shift in demographics since many of their customers are older. As those people die off, they are not replacing them with the Millennials.

The double hit of technology and demographics is causing a collapse in traditional retailers. Many are watching a icon like Macy's very closely, believing they are going to have a lot of issues too.

As bad as 2019 was for store closing in the retail world, 2020 is likely to be worse. We are only at the beginning of the bankruptcy wave.

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