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May 17, 2008 2:08:33 AM CDT

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Retailers Checking Out as Economy Falters  

Posted Apr 15, 08 8:00 AM CDT in Business    Most Covered

(newser) – Stores across the country are closing their doors, the New York Times reports, victims of a downturn in consumer spending. Retailers are often heavily leveraged, and as the economy falters banks are tightening credit. Several chains, including Sharper Image, have declared bankruptcy; others like Footlocker, Ann Taylor, and Zales are closing stores to stay afloat. “You have the makings of a wave of significant bankruptcies,” said a former Kmart executive.

Eight mid-sized chains have filed for bankruptcy since fall, and one big one—Linens ‘n Things—is expected to follow this week. And whereas bankruptcy was once survivable, rules have grown stricter since 2005. “It’s no longer reorganization or even liquidation for these companies,” said one bankruptcy lawyer. “In many cases, it’s evaporation.”

Source New York Times

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Retailers Checking Out as Economy Falters
Pedestrians walk by a Sharper Image store in Beverly Hills, Calif. in this Feb. 27, 2008 file photo. Sharper Image is among the retailers that have recently filed for bankruptcy   (AP Photo/Nick Ut, File)
Retailers Checking Out as Economy Falters
Jon Tapper holds a pair of unredeemable gift cards from bankrupt retailer The Sharper Image at his office in Boston, Monday, March 3, 2008.   (AP Photo/Josh Reynolds)
Retailers Checking Out as Economy Falters
Empty retail space is available at Orchards Corner mall in Lawrence, Kan., Friday, Feb. 29, 2008.   (AP Photo/Orlin Wagner)
Retailers Checking Out as Economy Falters
Empty retail space is all that remains of a Bombay Company story at the Town Center Plaza shopping center in Leawood, Kan., Friday, Feb. 29, 2008.   (AP Photo/Orlin Wagner)
Retailers Checking Out as Economy Falters
Eddie Bauer stores open doors for liquidation sales.   (Getty Images)
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recession  • economy  • consumer spending  • retail  • bankruptcy  • retail stores  • Linens 'n Things  • Sharper Image


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