The Retail Apocalypse Picks Up Speed As Sears, JCPenney, Brookstone And Mattress Firm Spiral Toward Bankruptcy



Over 20 major retailers have filed for bankruptcy since the beginning of last year, and in 2018 we may break the all-time record for annual store closings that was established just last year.  We are in the midst of the worst retail apocalypse in American history, and it appears to be picking up speed as retail giants such as Sears, JCPenney, Brookstone and Mattress Firm spiral toward bankruptcy.  We live at a time when the middle class is being systematically destroyed, and so the truth is that U.S. consumers simply do not have as much discretionary income as they once did.  Many large retailers believed that things would eventually turn around, and they have been fighting very hard to survive, but now time has run out for quite a few of them.


Mattress Firm
Everyone knew that Mattress Firm was in deep trouble, but it still surprised many of us when it was announced that they are officially planning to file for bankruptcy.  The following comes from Reuters…
Mattress Firm Inc, the largest U.S. mattress retailer, is preparing to file for bankruptcy protection as soon as this week, as it seeks to exit costly store leases and shore up its business, people familiar with the matter said on Tuesday.
At this moment Mattress Firm has approximately 3,000 brick-and-mortar locations, and as those stores close down those abandoned buildings are going to be giant eyesores on street corners all over America.

Brookstone
When I was a kid back in the 1980s, it seemed like Brookstone had an outlet in every mall I visited.  But now Brookstone has filed for bankruptcy, and all remaining mall stores will be shut down…
Brookstone filed for bankruptcy and will close its remaining 101 mall stores.
The mall and airport seller, best known for massage chairs, quirky gadgets, and travel luggage, filed for Chapter 11 bankruptcy in federal court on Thursday. It was Brookstone’s second bankruptcy round in four years.
Sears
Sears has been shutting down stores for years, but up until now they have never admitted that bankruptcy was on the horizon.
But now time has run out and emergency measures are required if Sears is to survive.  The following comes from CNN…
Sears is running out of time to fix its problems, the CEO says.
Eddie Lampert, who controls most of the company’s shares through his hedge fund, told the board on Monday that it must address “significant near-term constraints” in its cash position.
Of course Sears is still not actually using the term “bankruptcy”, but even CNNis admitting that Eddie Lampert used “language that suggested the company could be forced out of business”…

JCPenney
Speaking of retailers that are going to zero, JCPenney is absolutely drowning in debt and has a very dismal prognosis for the future…
Leaderless, $4 billion in debt and with a stock price below $2, the besieged retailer faces an uncertain fate after posting its latest round of dismal earnings.
“They’re in a leaky boat that eventually will sink,” said Mark Cohen, the director of retail studies at the Columbia Business School and a former CEO of Sears Canada and other department stores. “The prognosis for the future is not happiness.”
In the end, JCPenney is not going to survive, and so America will have to shop elsewhere for substandard clothing at inflated prices.
Bed Bath & Beyond
Nobody is suggesting that bankruptcy is imminent for Bed Bath & Beyond, but if they continue to have disastrous sales results it won’t be too long before they are on the chopping block too…
The struggling retailer said Wednesday that it was bringing on two top management consulting firms to help it cut costs and improve its merchandise. CEO Steven Temares did not name the firms.
The housewares retailer needs help. Shares of Bed Bath & Beyond plunged nearly 25% Thursday to their lowest level since March 2000 because of awful sales during the previous quarter.
We are moving into the most critical time of the year for retailers.  Most troubled chains will hang on through the next three months, but once we get to January and February we will see many of them give up the fight for good.
Meanwhile, some of the retailers that are still doing okay are warning that our trade war with China will likely mean much higher prices for consumers…