5 chains possibly headed for bankruptcy in 2018

January 7, 2018

5 major chains likely to close stores or file for bankruptcy in 2018.

Barnes & Noble

A Barnes & Noble location at Baltimore's Inner Harbor

In 2011, Border's liquidated, closing 399 stores and laying off 10,700 employees in the process. If business doesn't improve, 2018 could be the year that competitor Barnes & Noble loses its shirt. Barnes & Noble has claimed that its financial struggles are based on weak consumer demand. However, CNN claims that blaming the economy is a grave mistake. The reality is that Amazon is eating its lunch. If Barnes & Noble doesn't survive, not only as many as 26,000 could be looking for new jobs, the publishing business as we know it could severely be challenged.

Stein Mart

Stein Mart's headquarters in Downtown Jacksonville. Courtesy of Mathew105601 at wikipedia

Founded in 1902 and based in Jacksonville, Florida, Stein Mart is a discount apparel chain with 293 stores and 11,000 employees spread across 31 U.S. states. Like many companies in the retail business, declining sales has led to Stein Mart investing in cost-cutting mode for its survival. In October 2017, the company laid off 10% of its workforce at its corporate offices and suspended its quarterly dividends in hopes of saving $10 million from the cost-reduction initiative. Nevertheless, Stein Mart came in at number nine on Time's list of 15 retailers most likely  to file for bankruptcy in 2018.

Southeastern Grocers

Several publications believe that Jacksonville-based Southeast Grocers is on the verge of heading into bankruptcy, leaving 50,000 jobs in question. While the operation of chains like Winn-Dixie, Harveys and Bi-Lo have improved in recent years, parent company Southeastern Grocers appears to be low on cash.

“They have some very good people at the district manager and merchant level,” Burt Flickinger, managing director with Strategic Resources Group in New York, recently told Food Dive. “The question is capital."

With  $900 million in unsecured notes issued by Southeastern’s holding company, Bi-Lo Holding Finance, due to mature in the next two years, Food Dive reports that SEG is already in the process of negotiating with bondholders to refinance the dept and that Chapter 11 bankruptcy could be a method to attempt to reconfigure its capital structure.

Article by Ennis Davis, AICP. Davis is a certified senior planner and graduate of Florida A&M University. He is the author of the award winning books “Reclaiming Jacksonville,” “Cohen Brothers: The Big Store” and “Images of Modern America: Jacksonville.” Davis has served with various organizations committed to improving urban communities, including the American Planning Association and the Florida Trust for Historic Preservation. A 2013 Next City Vanguard, Davis is the co-founder of Metro Jacksonville.com and ModernCities.com — two websites dedicated to promoting fiscally sustainable communities — and Transform Jax, a tactical urbanist group. Contact Ennis at edavis@moderncities.com

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