Nine West to File for Bankruptcy, Sell Intellectual Property
Footwear retailer Nine West is preparing to file for bankruptcy by as early as this week, according to a report Thursday. Aside from the bankruptcy filing, the White Plains, New York, company is planning to sell its intellectual property to Authentic Brands Group, a licensing firm that recently said it would purchase clothing brand Nautica, Reuters reported, citing sources familiar with the matter. Nine West will direct the sale proceeds toward about $1.5 billion in outstanding debt. Nine West missed a debt payment in March. As a result, the retailer had 30 days to either make the payment or declare bankruptcy, the report said. Nine West plans to continue operations, with creditors receiving shares of its business in place of debt payments.
Total Retail's Take: Following a six-year high for retail bankruptcies in 2017, the first half of this year (with still three months to go before the midway point) has seen its fair share of retail bankruptcies, highlighted by Toys"R"Us going out of business. Unfortunately, this would appear to be the new normal. Traditional brick-and-mortar retailers overleveraged with debt from extensive physical footprints, not to mention declining foot traffic and sales, are finding it difficult to survive without the bailout of a bankruptcy filing. Nine West is the latest. What needs to happen is retailers begin to use their stores as an advantage in the omnichannel shopping journey, a place that's more than just transactional. Incorporate services, omnichannel fulfillment (BOPIS, ship from store), experiences into your stores to make them hubs of activity that are integral to the future of shopping.
