New York & Co. parent files for bankruptcy, might close all stores

The women’s fashion retailer RTW Retailwinds filed for bankruptcy protection Monday and said it expects to close most or perhaps all of its stores.

The company behind New York & Co. said in a statement it has already begun a store-closing and liquidation process. Retail businesses have long struggled to contend with massive consumer shifts to online shopping, and now face the devastating financial impacts of COVID-19.

Established in 1918, RTW Retailwinds operates nearly 400 locations in 32 states. But even with a substantial e-commerce business, the company joins a growing list of retailers—including J. Crew and Neiman Marcus —pushed beyond the brink since the start of the pandemic.

New York & Co. has four stores in Indiana, including outlets at Castleton Square and Greenwood Park Mall. The others in the state are in Fort Wayne and Merrillville.

“The combined effects of a challenging retail environment coupled with the impact of the Coronavirus (COVID-19) pandemic have caused significant financial distress on our business, and we expect it to continue to do so in the future,” said Sheamus Toal, the chief executive officer of RTW Retailwinds, in a statement.

The company’s portfolio includes New York & Co., Fashion to Figure, and Happy x Nature.

RTW said its stores will continue to operate in the near-term during the bankruptcy process, and that more than 90 percent of its locations have reopened after temporarily shutting down to prevent the spread of the coronavirus. But the future of these locations is uncertain.

Sheamus said that a potential sale of the business or parts of it could offer the company the best path forward.

The filing comes just days after Seattle-based kitchenware company Sur La Table and one of the nation’s oldest and best-known retailers, Brooks Brothers, sought bankruptcy court protection, highlighting the punishing financial environment for retailers.

The industry has been battered by an array of economic forces that in many cases have been amplified by the pandemic, from the accelerating growth of online shopping to rapidly shifting apparel trends to rising rent and untenable debt burdens. RTW said the company expects to repay its outstanding loan balance of $12.7 million by the end of August.

Vulnerable brands have buckled under the strain of pandemic-fueled shutdowns. Retailers are coping with lockdown measures and plummeting foot traffic. And as many would-be customers are now working from home, many Americans no longer have the same need for wardrobes they’d typically sport at the office or out socializing. To preserve cash amid collapsed demand, retailers have stopped paying rent, furloughed workers, and canceled new inventory orders. Those emergency measures for many businesses have not been enough.

The country is also suffering historic rates of unemployment, squeezing consumer spending that companies would need to stage a comeback. Last week, another 1.3 million people filed for unemployment benefits for the first time, with claims elevated over 1 million every week since the pandemic began in March.

RTW is evaluating the sale of its e-commerce business and the intellectual property of its brands, the company said.

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