Many retailers are recovering, but there are some retailers still struggling.
In 2009 there were a staggering number of retailers that filed for bankruptcy. Retailers of all sizes saw their revenue plunge and their debts spiral out of control. Now, the industry as a whole is seeing a recovery, but there are still companies out there that are struggling.
Here is a list of four companies that might be headed to bankruptcy in 2010:
- Rite Aid; the company has been struggling since it required Brooks & Eckerd in 2006. While most drugstores didn’t take too much of a hit during the recession, Rite Aid saw its same-store sales drop for 10 consecutive months in December. The company recently promoted a new CEO, and that has investors hoping that the company can turn itself around.
- Blockbuster; the company closed 300 stores in 2009, and it is supposed to close over 600 more in 2010. The company is trying to reshape its business model by focusing on more kiosks and more on-demand services, but insiders worry that the transformation is going to be too expensive for the company. That combined with the fact that the company lost around $183 – $193 million in 2009 means that the company could be headed for bankruptcy.
- Borders; the company’s same-store sales dropped over 14% during the 2009 holiday season. The company announced plans to close 182 Waldenbooks stores during the end of 2009 and beginning of 2010. Borders is struggling to compete with online stores like Amazon, who a lot of times offer free shipping and tax free purchases.
- Zale; more commonly known as Zales, the company saw its holiday sales plunge 12% during December. Also, the company is having organizational problems, and several top executives resigned at the beginning of January.
It remains to be seen what happens to these companies, but they are definitely at the top of the list of companies that might be headed to bankruptcy in 2010. If you are familiar with the bankruptcy process then you understand that bankruptcy isn’t a death sentence for the companies. It depends on the company’s situation, but most companies file for Chapter 11 bankruptcy. Chapter 11 allows the company to remain operational while wiping out and restructuring debts.
Individuals faced with rough financial situations are also afforded the opportunity of bankruptcy. If you are struggling financially, you should consider bankruptcy. The bankruptcy process will help you wipe out and restructure debts to levels that are manageable for you. You’ll be able to sleep easier at night knowing that you are taking care of your finances, and bill collectors will no longer be able to contact you. If you’d like to find our more, contact a bankruptcy attorney today.