Pier 1 Imports is throwing in the towel amid the pandemic.
The home furnishing retailer, which filed for Chapter 11 bankruptcy in February, was never able to regain its footing amid nationwide coronavirus shutdowns. On Tuesday, it asked a court for approval to shut its doors for good.
Amid the wide swath of stores that sell non-essential merchandise temporarily shut down to slow the spread of the virus, Pier 1 also failed to find a buyer to keep the business afloat. Those efforts were severely hampered by the ongoing limits of the outbreak, the company said in a news release.
“Ultimately, due to the combination of a challenging retail environment and the new reality and uncertainty of a post-COVID world, the company and its advisors determined that an orderly wind-down is the best way to maximize the value of Pier 1’s assets,” according to the release.
The company, founded in 1962 as Cost Plus Imports, is seeking to sell its e-commerce business, inventory and intellectual property, according to Business Insider, but liquidation sales will be held as soon as stores reopen.
The Pier 1 website announced stores would continue operating until early fall, and that store closures would be staggered by location.
“The challenging retail environment has been significantly compounded by the profound impact of COVID-19, hindering our ability to secure such a buyer and requiring us to wind down,” Robert Riesbeck, Pier 1’s CEO and CFO said, according to Business Insider.
In January before the pandemic, the Fort Worth, Texas, company announced it would close about half its stores or about 450 locations. In 2016, the company reported having 13,500 employees.
The retail industry, racked by a dramatic drop in sales and traffic, could witness 3,000 brand closures this year, following record-high rates of closings last year, according to Business Insider.
Stores including J. Crew, Neiman Marcus, J.C. Penney and Stage Stores have filed Chapter 11 bankruptcy protection this month and will close hundreds of stores nationwide.
Retailers that offer groceries including Walmart, Target, Kroger and Costco are booming in a slow economy. Walmart’s online sales in the U.S. jumped 74% for the quarter ended April 30, which captured the brunt of the pandemic. Same-store sales rose 10% at U.S. Walmart stores on strong sales of food, health and wellness goods.
Home Depot and Kohl’s on Tuesday also joined Walmart to report the full impact of COVID-19 on financial operations. It revealed the vast disparity between those allowed to keep their doors open during the outbreak and those that were not.
Home Depot, another critical supply line for those sheltering at home and focusing on outdoor and indoor projects, reported strong sales and $850 million in additional costs related to COVID-19, mostly to compensate its workers.
Kohl’s, with its stores closed, swung to a $541 million loss, and revenue tumbled more than 40%.
Nordstrom is expected to release its earnings results after the regular markets close Tuesday. Target and Macy’s will release their financial results this week as well.
Online behemoth Amazon reported last month soaring sales in the first three months of the year, but profits slumped 29% because of extra costs related to the pandemic such as paying workers overtime to keep up with a surge in orders and disinfecting its vast warehouses where orders are packed and shipped.
— Information provided by The Associated Press was used to supplement this report.
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