On Monday, apparel retailer Destination Maternity lodged for bankruptcy protection as the company hopes to stay away from facing increasing issues posed by digital competition and expensive leases. Under the United States Bankruptcy Code’s Chapter 11, Destination Maternity will continue to remain open as it takes positive measures to rearrange the business.
The retailer functions under many brands, including ‘A Pea in the Pod,’ ‘Motherhood Maternity’ and ‘Destination Maternity.’
The company overall had 446 outlets in Canada, Puerto Rico and the US until August 3. Besides, it also operated around 491 stores-within-a-store at several department stores as well as baby apparel retailers.
The company now plans on closing 183 outlets after already closing 27 stores recently, as per a filing in the court. Bankruptcy permits firms to get away from unprofitable leases.
However, in its court filing, the company blamed the turmoil of the fashion retail industry, lowering birth rates, high leadership turnover and rents for the faltering.
Destination Maternity refused to comment further on the matter and also refused to provide a list of the locations about to shut down.
In its Monday’s bankruptcy petition, the company listed $244mn in debts and $260.2mn in assets.
Notably, other fashion retailers which have also filed for a bankruptcy protection so far this year include Charlotte Russe, Payless ShoeSource and Forever 21.