The women’s clothing company filed an application for Chapter 11 on Thursday, a result of “economic hardship due to the pandemic and its ongoing impact,” it said. Christopher & Banks, which has about 400 locations in 44 states, said it would close a “significant portion” of the stores and is in an “active discussion” about selling its site.
Bankruptcy was foreseen last year when the company announced it was hiring an investment banker to refinance its debt and “explore other strategic alternatives.”
; In May, the company borrowed between $ 5 million and $ 10 million from the Paycheck Protection Program, according to CNN Business’ database.
Christopher & Banks admitted in its latest earnings release that Covid-19 has particularly disrupted shopping habits for women shopping in stores that offer more formal attire. They have become more pragmatic customers, the company said, opting for casual wear instead of social engagement wear.
It is certainly not alone. Other retailers have mentioned similar reasons in their bankruptcy filings last year. Ascena Retail Group, owner of Ann Taylor, Loft and Lane Bryant, said its business had been “severely disrupted” by the pandemic and closed hundreds of stores. RTW Retailwinds, owner of New York & Co., also closed most of its stores.
With the shift towards working from home, the purchase of workwear has gone out of fashion and puts futures at companies that rely on office wear at risk. New data from Coresight Research reveals that more than 8,700 stores closed in 2020, and a further 1,400 closed just this year.