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Payless ShoeSource is closing all of its remaining 2,100 stores in the United States and Puerto Rico, joining a list of iconic names like Toys R Us and Bon-Ton, which have closed over the past year.
The chain based in Topeka, Kansas, announced Friday that it would hold liquidation sales starting Sunday and that it would cease its online trading activities. All stores will remain open until at least the end of March and most will remain until May.
The debt chain filed for chapter 11 bankruptcy protection in April 2017, closing hundreds of stores as part of its reorganization.
At the time, it had more than 4,400 stores in more than 30 countries. After having restructured its operations four months later, with approximately 3,500 stores, it eliminated a debt of more than $ 435 million.
The company said in an email that the liquidation would not affect its franchising business or its Latin American stores, which remain open as usual. It lists 18,000 employees worldwide.
Increasingly, shoppers are buying online or heading to discount stores, such as T.J. Maxx to get offers on branded shoes. This change has affected traditional retailers, even cheap outlets like Payless. Heavy debt has also handcuffed retailers, making them less flexible to invest in their businesses.
However, bankruptcies and store closings will continue until 2019, so there's "no light at the end of the tunnel," according to a report from Coresight Research.
Prior to this announcement, 2,187 US store closing announcements were announced this year. Gymboree and Ascena Retail, the parent company of Lane Bryant and other brands, account for more than half of the total, according to the research firm. This year's total is up 23% from the 1,776 listings of the previous year. Since the beginning of the year, retailers have announced the creation of 1,411 stores, offsetting 65% of store closures, he added.
Payless was founded in 1956 by two cousins, Louis and Shaol Lee Pozez, with the goal of offering self-service stores selling affordable shoes.
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