Just this past August 6, the jewelry chain Claire’s announced it had filed for bankruptcy for the second time, planning to close around 18 stores; however, it now appears that the number of closures could rise to over 1,000 locations. If you’re a customer of these stores, here’s everything we know so far.
Why Is Claire’s Closing Stores?
The company voluntarily filed for Chapter 11 bankruptcy in the United States Bankruptcy Court in Delaware to maximize the value of its business. Claire’s aims to monetize its assets and continue exploring potential strategic partnerships.
This decision is a response to growing competition, changes in consumer spending, declining foot traffic in consumer spending, and economic pressures. According to court records, Claire’s is now seeking a buyer for around 800 locations and has identified that more than 1,100 stores could be added to the closures.
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Which Stores Will Claire’s Close?
The more than 1,100 stores are located across various states in the country and will close if the company does not quickly find a buyer. For now, the first 18 stores will close on September 7, located in the following areas:
Claire’s Stores
- Eastdale Mall, Montgomery, Alabama
- Newpark Mall, Newark, California
- Ford City Mall, Chicago
- Market Street, Lynnfield, Massachusetts
- Bay City Town Center, Bay City, Michigan
- Northtown Mall, Blaine, Minnesota
- Livingston Mall, Livingston, New Jersey
- Uniontown Mall, Uniontown, Pennsylvania
- Shops at Highland Village, Highland Village, Texas
- Pinnacle at Turkey Creek, Knoxville, Tennessee
- Junction Commons, Park City, Utah
- Provo Town Center, Provo, Utah
- Woodinville Plaza, Woodinville, Washington
Icing Stores
- Galleria at Tyler, Riverside, California
- Woodland Mall, Grand Rapids, Michigan
- Greece Ridge, Rochester, New York
- Mall of Abilene, Abilene, Texas
- University Orem, Orem, Utah
Can I Still Shop at Claire’s Stores?
Yes. The company stated it plans to maintain liquidity during the bankruptcy process and confirmed that its stores in North America will remain open, continuing normal operations while future options are explored.
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What is Chapter 11 of the U.S. Bankruptcy Code?
Chapter 11 allows companies to reorganize their debts, typically with the goal of continuing operations. It is one of the most complex bankruptcy procedures, in which the company must present a detailed reorganization plan and negotiate with creditors.
This legislation provides businesses with a chance for a fresh start, although it may also result in the partial transfer of asset ownership to creditors. As a result, business owners must carefully assess the costs and benefits before deciding to file for bankruptcy.
What benefits does Chapter 11 offer?
This section serves as an alternative to penalties, meaning that the company or individuals seeking it can avoid immediate dissolution, liquidation, and drastic cuts. During this process, the law allows the entity to continue operating and restructure without pressure from creditors. At the same time, it enables them to negotiate and propose a repayment plan for their debts.
Moreover, reorganization procedures under Chapter 11 offer the advantage that the company’s management retains control over the business, making the reorganization plans generally more effective, as the executives who stay in charge are the ones best familiar with the company, partnership, or individual involved.
