PDT Staff Writer
Though its future is unknown, the Steve & Barry's outlet in New Boston still is open for business, despite the company filing Chapter 11 bankruptcy protection last week.
The discount store cited a cash crunch that was thought to have come from the staggering economy. The crunch will hinder the company's ability to open stores and borrow money, officials said.
The fate of the New Boston location remains uncertain, according to local officials. First opening in March 2007, the business is located in the former Festival Foods building, which closed several years ago.
The 53,000-square-foot location employs 100 full- and part-time people.
It first was reported in the Wall Street Journal the company would be filing for bankruptcy protection.
As part of the company's plan to consolidate resources, it plans to close 100 (if not all) of its stores soon. According to USA Today, the company already has eliminated 172 corporate and field staff positions.
"Everything in the company is fully operational, and no stores are closing at this current time," said a Steve & Barry's spokesperson.
The opening of the New Boston location marked the 191st store for Steve & Barry's in 33 states, and the 20th in Ohio.
The company operates 276 locations in 39 states.
USA Today also reported speculation in the marketplace about the company's cash issues in recent weeks became "self-fulfilling prophesies." It said many suppliers cut off access to services and supplies. It also said landlords stopped making "contractually owed payments for construction and store-opening work" the retailer performed.
"The generally poor environment for apparel retailers has reduced funding to our suppliers, landlords and to our company," said Steve Shore and Barry Prevor, company co-founders and co-CEOs, in a statement. "It has become increasingly difficult for us to continue operating under these circumstances.
"We are in discussions with potential strategic and financial partners, and working on solutions for a stronger Steve & Barry's to emerge from this process. We will continue to do everything possible to achieve the best outcome under these circumstances."
One source reported Sears or another national retailer might acquire one or some of the Steve & Barry's line of clothing to sell in its stores. Sears could open a Steve & Barry's store-within-a-store areas in its Sears or Kmart locations, one analyst said.
The company was founded in 1985, and was built on selling clothing for $10 or less, making its own clothes and selling products in bulk.