A perfume company that has stores nationwide, including in Massachusetts, recently decided to file for bankruptcy. According to the company, the Chapter 11 bankruptcy filing will allow it to reorganize effectively. A total of 64 of its more than 200 stores will be closed as part of the bankruptcy filing.
Perfumania sells high-end-brand perfumes at discounted prices — for example, perfumes from Burberry and Dolce & Gabana. The fact that the company will continue to operate following its bankruptcy filing sets it apart from other retail brands that are now defunct. Through the bankruptcy filing, Perfumania will simply strive to renegotiate the company’s leases as well as concentrate on the higher-performing stores. Its ultimate goal is to create a foundation for long-term growth.
Even after closing 103 stores during the past three years, Perfumania was still losing money. The company is planning to continue increasing its online sales in an effort to offset losses. Other retailers that have closed large numbers of stores this year include JCPenney, Bebe and Staples. These companies are generally finding it difficult to compete with the growing e-commerce sales taking place at Amazon.
Sometimes, companies in Massachusetts struggle to keep up with all of their liabilities due to a changing economic or industry landscape. In this case, filing for Chapter 11 bankruptcy may provide them with a much-needed second chance financially. An attorney can provide guidance with the bankruptcy filing process and ensure that a business owner‘s goals are upheld, and that his or her rights are protected at each stage.
Source:Â cnn.com, “Perfumania files for Chapter 11 bankruptcy“, Laura Sanicola, Aug. 28, 2017