For the second time in less than two years, accessories retailer Charming Charlie has filed for bankruptcy, according to Bloomberg. With plans to close all 261 stores, more than 3,000 full- and part-time employees could lose their jobs.
Charming Charlie filed for bankruptcy protection in December 2017, closing 100 stores and its Los Angeles office in an effort to cut costs. The retailer emerged from that bankruptcy in April 2018, but “continued to face challenges that make it impossible for Charming Charlie to continue as a going concern,” according to a court declaration by CFO Alvaro E. Bellon.
These headwinds included fewer mall visits by customers, landlords that required the retailer to keep some weak stores open and a lack of capital. By the time of this recent bankruptcy filing, the retailer had only $6,000 cash on hand.
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Charming Charlie has debt of approximately $82 million, comprised of an asset-based credit line, a term loan facility and vendor payment credit line, according to court papers cited by Bloomberg.
The retailer was founded in 2004 and became known for arranging the merchandise in its stores according to color. Charming Charlie expects the bankruptcy and liquidation process to take approximately two months, and it will vacate its stores by Aug. 31, 2019.
