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David's Bridal, the country's largest wedding retailer, on Monday demanded Chapter 11 protection from bankruptcy, but promised the wives that no one would lose his dress.
David's Bridal filed for bankruptcy protection Monday, hoping to stay open as he struggled with an avalanche of debt and disruption in the wedding industry.
The country's largest bridal retailer, which has been in turmoil for years, said in a statement that the restructuring deal would cut its $ 750 million debt by $ 400 million and allow it to continue operating its approximately 300 US stores, promising that "orders would arrive". appointments for the bride and time will not be affected. "
"For over 60 years, David's has been offering gorgeous and high quality dresses and accessories for the most special occasions of our clients. The actions we are taking will allow us to build on that tradition, "said Executive Director Scott Key in a statement. . "Our team is laser-driven to provide brides and their families with the five-star service and experience that they deserve and expect from us.
Since its acquisition in 2012 by private equity firm Clayton, Dubilier & Rice for more than a billion dollars, the finances of the company based in Conshohocken, Pennsylvania, have continued to decline. Teamsters and consumer rights advocates warned of corporate failures at Grand Bridal Expo 2016, and rumors of bankruptcy solidified after David missed a major debt payment last month .
David's Bridal struggled to keep up with the seismic pace of the wedding industry: booming online bridal retailers, later marriage trends, and the increasing number of consumers spending less on weddings. Similar struggles led his cohort, Alfred Angelo, to close 10 stores without warning in July 2017 and declare bankruptcy.
"Although its wedding products are varied, the company is competitive in a small niche in the retail sector and has a limited product diversity compared to the world's leading retailers," Moody analysts wrote in a report. solvency after the announcement of the bankruptcy. "The company is therefore dependent on changing volumes and wedding budgets."
Raya Sokolyanska, Senior Analyst at Moody & # 39; s Corp. David Bridal, has found that the changing tides are changing an already difficult sector, which is based on a one-off interaction with customers whose expectations and emotions are strong. its commercial proposal.
"Even though they sell high-end and mid-priced dresses, their main business is essentially Walmart wedding dresses," said Sokolyanska. "They had to balance the sales to different customers with different needs."
They also took time to adjust to the trend of "casual" marriage, according to S & P Global Ratings analyst Mathew Christy, who saw the standard white dress replaced by more informal dresses that could be worn on other occasions.
"As brides seek to either reduce their wedding expenses or spend less on gowns, this has resulted in lower spending on wedding or wedding dresses at their destination and smaller weddings," Christy told USA. Today.
The departure of traditional wedding styles has also spawned a wave of wedding lines at unmarried retailers, such as H & M and the online clothing company Reformation. David's Bridal must also compete with companies such as BHLDN, the sister brand of Anthropologie, which offers more contemporary wedding dresses at a higher price.
This year, the company has made efforts to evolve by offering individual appointments, strengthening its presence on social networks and expanding its selection of discount dresses. According to market research firm IBISWorld, David's still occupies a significant share of the US bridal market, with about one-third of the US wedding dresses sold each year. If it manages to stabilize through ongoing restructuring and modernization, said Sokolyanska, she could very well withstand the storm.
"There is a brand recognition and a market share that should allow the company to continue operating," said Sokolyanska. "I do not think they will regain the profitability they had a few years ago, but at least they can defend what they have."
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