When Neiman Marcus opened a store in Bellevue in 2009, many locals were skeptical that a shop specializing in four-figure cocktail dresses and handbags could survive the Great Recession. But while the upscale scale retailer proved its skeptics wrong in that recession, it isn’t so lucky this time.
Neiman Marcus (Neiman Marcus Group) is the premier destination for luxury fashion and unparalleled service. For more than a century Neiman Marcus has transformed and elevated the shopping experience, becoming a leading purveyor of the world’s most unique luxury goods.
Just 16 months ago, Neiman Marcus rolled out the red carpet to debut its 188,000 sq.-ft. store at Hudson Yards mall, the ambitious retail project on the West Side of Manhattan. Now after much speculation, the bankrupt retailer has confirmed it will exit the location as part of its Chapter 11 bankruptcy restructuring.
The Neiman Marcus Group is just one of many major retailers being severely impacted by the Covid-19 virus pandamic, joining the growing list of brands filing for bankruptcy. Prior to the outbreak, there was speculation that the company, which is behind Neiman Marcus, Bergdorf Goodman, Mytheresa, Last Call, and Horchow, was the next retailer to file for bankruptcy because of its $4 billion in long-term debt. The COVID-19 pandemic has created an additional struggle for the retailer, as its stores have been closed since March.
The 113-year-old retailer follows several other fashion brands that have succumbed to the pressures of the pandemic and filed for bankruptcy over the last few months, including J. Crew, J.C. Penny, Centric Brands and True Religion, among others.
The Neiman Marcus Group temporarily closed its 43 Neiman Marcus and two Bergdorf Goodman stores nationwide in compliance with guidelines set by the Centers for Disease Control and Prevention in response to the COVID-19 pandemic. It has since reopened 31 stores for customer traffic.
Court documents indicate the retailer is closing four Neiman Marcus locations, including its recently opened 188,000 square-foot location at Hudson Yards, as well as its Bellevue, Wash., Palm Beach, Fla. And Fort Lauderdale, Fla. locations. It has also closed 17 out of 22 Last Call outlets. Sources indicate that Neiman Marcus may also close its doors in Dallas, St. Louis, Natick, Mass. and Westchester, N.Y. The company is also closing two of its distribution centers in Longview and Las Colinas, Tex.
Several factors contributed to Neiman Marcus’ bankruptcy. The COVID-19 pandemic has strained the company’s operations because of its temporary store closures nationwide. The company also furloughed roughly one-third of its 13.700 employees as a result of those closures. Neiman Marcus plans on having a reorganization plan confirmed by early September.
The Corona virus pandemic has also a big inpact on the bankruptcy proceedings. One impact of the COVID-19 pandemic on the bankruptcy proceedings is that the Neiman Marcus Group cannot liquidate the business while stores remain temporarily closed. It also may be more difficult to negotiate debtor-in-possession financing to keep the business running during the pandemic.
Partly for political reasons, and the decisions that have been made, the Covid 19 pandamic is not over yet. Its far from over, especially in some of Neiman Marcus’ ‘cities’. So lets think about the loyal 13.700+ employees in this véry difficult times.