Ascena Retail Group Archives

Ascena Retail Group files for bankruptcy; parent company of Ann Taylor, Loft, Lane Bryant, Justice, Lou & Grey, and Catherines and more will close hundreds of stores

July 23, 2020

by Daphne Sorenson

Ascena Retail Group—the Mahwah, New Jersey-based corporation that owns several major women’s fashion retail stores—filed for Chapter 11 bankruptcy on July 23, 2020. Ascena is the parent company of the retail stores Ann Taylor, Factory Ann Taylor, Loft, Loft Outlet, Lane Bryant, Justice, Lou & Grey and Catherines. According to Bloomberg, Ascena expects to shut down about 1,600 of its 2,800 stores worldwide. All of the Catherines stores will be shuttered.

Bloomberg also reports: “The company listed about $12.5 billion of liabilities, including $1.6 billion of funded debt. More than two-thirds of its secured term lenders support its restructuring plan, and they’ll wind up owning most of the new equity, Ascena said in a statement and court papers. Almost $1 billion in debt will be erased, and Ascena will get $150 million in fresh funds from existing lenders.”

The company was founded in 1962, in Stamford, Connecticut, under the name Dressbarn and then changed its named to Ascena Retail Group in 2011. Ann Taylor and its lower-priced spinoff Factory Ann Taylor cater to career women on the go, while Loft and its lower-priced spinoff Loft Outlet target a younger customer base. Lou & Grey offered mostly casual clothing for women. Lane Bryant and Catherines were launched as clothing stores for plus-sized women. Justice has fashion for girls ages 7 to 14.

Even before the coronavirus pandemic (when Ascena temporarily closed all of retail locations on March 18, 2020), the company was already headed toward financial disaster, since it had been closing an increasing number of stores since 2018. Ascena Retail Group closed all Dressbarn locations in 2019. Depending on the state, county or city in the United States, some clothing retail stores have re-opened since the pandemic, while others have not, as of this writing. The re-opening policies vary.

Ascena Retail Group is among the growing list of fashion retailers that have declared bankruptcy since 2018. On the high-end retail spectrum, Henri Bendel completely shuttered its stores in 2019. Barney’s filed for Chapter 11 bankruptcy in 2019, while Nieman Marcus did the same in May 2020. Lord & Taylor is reportedly close to Chapter 11 bankruptcy as well.

Non-luxury fashion retailers have also been victims of the “retail apocalypse,” which has been largely blamed on the rise of online shopping. J. Crew declared Chapter 11 bankruptcy in May 2020. Low-end clothing retailers that shuttered in 2019 included Gymboree and Payless ShoeSource.

Other fashion retailers that had a massive percentage of store closures in 2018 and 2019 included Victoria’s Secret, Gap, Kohl’s, Abercrombie & Fitch, Foot Locker, Children’s Place and David’s Bridal. A few fashion retailers (such as Charlotte Russe and Bebe) have emerged from bankruptcy and are slowly trying to build back their business under new ownership. Department stores that carry fashion (such as Macy’s, JC Penney, Kmart and Sears) have also been closing stores.

Dressbarn going out of business; store closures begin in 2019

May 21, 2019

by Daphne Sorenson

Dressbarn is permanently shutting its doors. The fashion retailer announced that it’s closing all of its approximately 650 stores, with the first set of stores scheduled to shutter in July 2019. (Click here for the list of stores that will close in July and August 2019.)

Dressbarn is owned by Ascena Retail Group (headquartered in Mahwah, New Jersey), which also owns fashion retailers Ann Taylor, Loft, Lane Bryant, Justice and Catherines. All of the brands owned by Ascena have been experiencing major financial problems, and have been shutting down numerous stores.

The death of Dressbarn is the latest example of the “retail apocalypse” that has decimated businesses that rely heavily on brick-and-mortar locations. Fashion retail has been hit especially hard in 2018 and 2019. Lord & Taylor, Henri Bendel, Gymboree and Payless ShoeSource have closed all of their brick-and-mortar stores. The Children’s Place, Gap, Claire’s Michael Kors and Foot Locker are among those that have downsized significantly. Charlotte Russe and Bebe are among the few fashion retailers that have emerged from bankruptcy in the past year and are trying to rebuild their business under new ownership.

Here is the full press release from Dressbarn about the stores closures:

Dressbarn today announced plans to commence a wind down of its retail operations, including the eventual closure of its approximately 650 stores.

All Dressbarn stores are open and conducting business as usual, as is Dressbarn’s ecommerce site. Customers can continue to shop at Dressbarn in-store and online and use Dressbarn-branded credit cards for purchases. There are no current changes to Dressbarn’s return, refund, or gift card policies.

Steven Taylor, Chief Financial Officer of Dressbarn, said, “For more than 50 years, Dressbarn has served women’s fashion needs, and we thank all of our dedicated associates for their commitment to Dressbarn and our valued customers. This decision was difficult, but necessary, as the Dressbarn chain has not been operating at an acceptable level of profitability in today’s retail environment. During the wind down process, we will continue to provide our customers with the same great experience both in-store and online, offering them even better deals and value. We will work to assist our associates through the transition and maintain existing relationships with our vendors, suppliers, and other key stakeholders through this process.”

Plans for closing individual Dressbarn locations, including information about store closing sales, will be shared during the wind down process. Dressbarn has retained A&G Realty Partners to assist on real estate-related matters.

Dressbarn associates will be notified when decisions are made about specific store closures and provided with transition support. Dressbarn intends to continue paying its vendors and suppliers in full in the ordinary course for products and services provided to Dressbarn during its wind down process.

Troy Taylor, President of financial advisory and investment banking firm Algon Group, has been appointed as independent director to the Board of Directors of The Dress Barn, Inc.

About Dressbarn

Dressbarn offers an assortment of women’s clothing for every day and occasion, operating approximately 650 stores across the United States and employing approximately 6,800 associates. The Company was founded in 1962 by Elliot and Roslyn Jaffe, who recognized the need of women who were entering the workforce for a convenient one-stop shop where they could find fashion at a value. The single store in Stamford, Connecticut grew to a nationwide chain.

Fashion retail in crisis: Top 15 companies that will have the most store closures in 2018

June 7, 2018

by Daphne Sorenson

Shopping habits have radically changed in the past 20 years. Online shopping is a trend that’s not only here to stay, it’s growing. And many retail companies that rely on brick-and-mortar stores for most of their sales have seen their business suffer as a result. The fashion retail business has been hit especially hard. Business Insider recently published a list of retailers that will close the most stores in 2018, and half of the companies on the list are retailers whose core business is fashion.

Trying on clothes and accessories in person and being able to bring home those purchases immediately may seem like the main reasons why people would want to do their fashion shopping in a brick-and-mortar store. But the reality is that many customers have been increasingly turned off by shopping in stores, for various reasons such as lousy customer service and the inconvenience of having to travel to a brick-and-mortar store. With many online retailers offering deep discounts, free shipping and convenient return policies, it’s easy to see why online shopping has become so attractive to consumers.

Here are the fashion retail companies that are facing the most closures in 2018, according to Business Insider and other sources.

1. Ascena Retail Group (Parent company of Ann Taylor, Loft, Lane Bryant, Dress Barn, Catherines and Maurices)

Number of stores expected to close: 667

https://www.youtube.com/watch?v=v247HadJXyM

2. Gap Inc. (Parent company of Gap, Banana Republic, Old Navy, Intermix, Weddington Way and Athleta)

Number of stores expected to close: 200