(PHOTO: REUTERS / Lucas Jackson)
Discount retailer Syms Corp and its wholly owned subsidiary Filene’s Basement filed for bankruptcy on Wednesday after failing to make ends meet during tough economic times, to the demise of many brides-to-be.
The company, well-known for its annual one-day “Running of the Brides” dress sale, filed for voluntary petitions under Chapter 11 of the U.S. Bankruptcy Code in a court in Wilmington, Del., ending a long “uphill battle.”
“This has been a challenging time for Syms and Filene’s Basement,” Syms CEO Marcy Syms said in a statement.
As of September, the companies listed $236 million in assets and $94 million in liabilities, according to the Chapter 11 filing.
“We have been faced with increased competition from large department stores that now offer the same brands as our stores at similar discounts; a proliferation of private label discount chains; a decline in buying opportunities as brand name labels have reduced overruns by improving their supply chain management – all combined with the worst economic downturn in our lifetimes.”
“All these factors affected both chains and they came at a time when Filene’s Basement, which was just emerging from bankruptcy, was already waging an uphill battle to rebuild its customer base,” Syms shared.
Syms Corp had bought Filene’s Basement out of bankruptcy in 2009 through an auction. Retail Ventures, Inc had previously owned the company until April 2009.
This is the third time Filene’s Basement has filed for Chapter 11 bankruptcy protection. The Massachusetts-based company has continually downsized their number of stores, which now runs about 21 stores and more than 1,500 employees.
They recently shut down two stores in Ohio and Maryland, along with four shops in Massachusetts.
“The filings today are the result of a process that has been taking place for several months. Our board has conducted a rigorous assessment of all the strategic options and alternatives available and after careful consideration has come to the conclusion that a bankruptcy filing and liquidation is the best way of maximizing value for all stakeholders,” Syms added.
“I want to express my appreciation to our employees, many of whom have devoted their careers to Syms and Filene’s Basement, for their loyalty and hard work. I also want to thank our educated consumers and bargain hunters for their dedicated support over many years.”
Liquidation and going out of business sales of Filene’s Basement and Syms will begin approximately mid-November, subject to court approval, and is expected to run through January 2012.
The century-old store carries current, brand name and designer apparel for men and women at prices 30 to 60 percent below regular department store prices. They also sell clothing for children as well as accessories, shoes, luggage and home furnishings.
Edward A. Filene founded Filene’s Basement in 1909 as a way to clear out merchandise from his family’s department store. Other leading retailers began to bring their unsold goods to him as well and the concept of the “off price” store was born, according to the website.
Sy Syms founded Syms Corp in 1959. For more than 50 years, Syms has been the off-price representative for more than 200 authentic designer and brand name goods.