WALMART is to lose its entire fleet of Claire’s shop-in-shops after the iconic brand’s bankruptcy filing, according to reports.
Bosses at the jewellery chain last week submitted the relevant financial papers for the second time in seven years.
Claire’s products are on sale at 2,500 Walmart stores across the US[/caption]
Claire’s has said it plans to close 700 stores to stay in business in the US[/caption]
Now, it’s emerged that their 300 mini stores in Walmarts across the US are under threat.
Claire’s had announced a partnership with Walmart in 2018.
That meant the ear piercing experts set up shop inside the retail giant’s stores around the US.
But with news of the bankruptcy filing, The Retail Dive reports their shops in shops deal with Walmart is over unless a buyer comes forward.
Their products are also on sale at 2,500 Walmart stores across the country. It is not clear what will happen to those items.
The US Sun has gone to Walmart and Claire’s for comment.
Claire’s – which has approximately 1,300 Claire’s outlets across the US – has already said it plans to close 700 stores to stay in business.
The global brand currently boasts more than 2,750 outlets in 17 countries in North America and Europe.
It also has 190 Icing stores as part of its portfolio.
But a dip in sales has meant it has struggled to pay rent on some of its stores, according to Bloomberg.
Rent payments were reportedly skipped on some locations in June and July.
How does bankruptcy work?
Bankruptcy is a specific legal process that helps companies eliminate debt they can’t repay.
The process allows businesses to start fresh and gain access to new credit.
Supervised by federal courts, bankruptcies allow a company to sell off its assets more easily to pay off creditors, according to Investopedia.
Chapter 11, a common process for companies, is used to restructure a business with the goal of remaining open – even if it means selling off most of the company’s properties.
Chapter 7, on the other hand, sells all of a company’s assets, putting it out of business.
Chapter 15, alternatively, allows for collaboration between American and foreign courts to conduct bankruptcy proceedings with “parties of interest involving more than one country,” per the United States Courts.
Claire’s Chief Executive Officer Chris Cramer told a court: “The majority of the Company’s customers are young individuals who do not themselves have access to funds, credit cards, or the ability to shop online.
“These customers rely on their parents or caretakers to bring them to the Company’s stores so that they can see and touch the Company’s products.
“Accordingly, the Company struggled to create an online website that could compare to the tactile shopping experience that is so vital for its young customers.”
In 2022, Claire’s also opened mini stores inside 21 Macy’s stores.
Claire’s previously filed for bankruptcy in 2018. At the time, bosses scrambled around $2 billion worth of debt.
