Teen Jewelry Retailer Claire's Files for Bankruptcy Again

Claire's, once a staple for mall-going tweens and teens, filed for bankruptcy for the second time in seven years on Wednesday, multiple news outlets reported. The company faces about $500 million in debt. CEO Chris Cramer called the decision difficult but necessary in a statement.

"Increased competition, consumer spending trends and the ongoing shift away from brick-and-mortar retail, in combination with our current debt obligations and macroeconomic factors, necessitate this course of action for Claire's and its stakeholders," said Cramer, adding Claire's retail stores in North America will remain open while the company continues to "explore all strategic alternatives."

Total Retail's Take: Claire's has been down this road before; in 2018, the company filed for bankruptcy for similar reasons, including acquiring debt in an increasingly online world where in-store sales declined. CNBC reported that during that restructuring, Claire's was able to eliminate $1.9 billion in debt and keep stores operating with the help of $575 million in new capital. The jewelry and accessories retailer faces an uphill battle, between its current debt load, steep tariffs expected to impact its supply chain, threats from ear piercing competitors such as Rowan and Studs, and a new generation of consumers shopping online.