Delaware escapes Payless ShoeSource closings

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Payless ShoeSource stores in Delaware apparently escaped a wave of closings.

Payless has seven stores in Delaware. Retail sites in the  First State often avoid mass closings, due to the lack of a sales tax.

The company announced it would close 400 stores while filing for Chapter 11 protection in St. Louis.

Reports of a  bankruptcy filing have surfaced in the past month or so.

The company also announced plans to work to “aggressively manage the remaining real estate lease portfolio either by modifying terms, or evaluating closures of additional locations,”  Chapter 11 gives the company wiggle room in renegotiating leases.

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 The closings come as retailers face increasing  competition from online sites as well as upscale discounters such as DSW.

 In Delaware and elsewhere,  Payless has locations in older malls and strip centers.

 Meanwhile, the privately held budget shoe store and handbag  chain has  seen its customer base struggle with an economic upturn that has left many behind.

 Payless  ShoeSource has approximately 4,400 stores in more than 30 countries. The company was founded in Topeka, KS, the site of its headquarters. The company has long been viewed as having too many stores.

Paul Jones, Payless CEO   stated, “This is a difficult, but necessary, decision driven by the continued challenges of the retail environment, which will only intensify. We will build a stronger Payless for our customers, vendors and suppliers, associates, business partners and other stakeholders through this process. While we have had to make many tough choices, we appreciate the substantial support we have received from our lenders, who share our belief that we have a unique opportunity to enable Payless — the iconic American footwear retailer with one of the best-recognized global brands — to remain the go-to shoe store for customers in America and around the globe.”

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