Discount retailer Stein Mart has filed for bankruptcy and plans to close its nearly 300 stores. The 112-year-old company blamed its failure on changing consumer habits and the pandemic, both of which "have caused significant financial distress on our business," Stein Mart CEO Hunt Hawkins said in a release on Wednesday. Like other retailers, Stein Mart's operations were severely hit after the pandemic forced temporary store closures in many states. Stein Mart said in June that COVID-19 caused financial distress for the company, adding in a regulatory filing that it had "substantial doubt" it would continue to operate for the next year.
Total Retail's Take: The devastating impact of COVID-19 on the retail industry continues, with Stein Mart the latest victim. Now, like many other traditional brick-and-mortar retailers that have filed for bankruptcy and/or closed stores in recent months, and the list is long, including J.Crew, J.C. Penney, Neiman Marcus, GNC, Tailored Brands, among others, Stein Mart found itself in financial distress long before the coronavirus was an issue on Americans' radars. However, the global pandemic essentially was the straw that broke the camel's back, pushing Stein Mart into a hole in which it would be unable to dig itself out of. And while I'd like to be more optimistic, reality is telling us that there will be many more bankruptcy filings to come, as overleveraged retailers look to rid themselves of mounting debt. Unfortunately for the retail industry, and particularly those businesses with overdeveloped physical footprints, it's likely to get worse before it gets better.