Charming Charlie Files for Bankruptcy Protection
Houston-based Charming Charlie filed for Chapter 11 bankruptcy protection on Friday with a plan to revamp operations, reduce debt, and shrink its chain of jewelry and accessories stores in a hotly competitive retail environment. The company said in a news release that it had entered a restructuring support agreement with most of its lenders and shareholders. Through the agreement, the company aims to overhaul its capital structure and close some of its roughly 375 stores. In Delaware bankruptcy court filings, the company reported $100 million to $500 million in both assets and liabilities.
Total Retail's Take: This news comes a week after Charming Charlie announced an overhaul of its management, store closures and job cuts. The specialty accessories retailer has been challenged by declining in-store traffic and sales, and is taking the necessary steps to preserve the business going forward. The case of Charming Charlie is a common one in retail, as the brand grew very quickly and in the process expanded its physical footprint. Now that more competitors have entered the field, particularly online, business has slowed and the costs of operating such a large network of stores have become untenable. Perhaps a scaled-down version of Charming Charlie, with a greater focus on digital, will get the retailer back on the track to prosperity.