Aerosoles announced Friday that it voluntarily filed petitions to reorganize under chapter 11 of the U.S. Bankruptcy Code in the U.S. Bankruptcy Court for the District of Delaware.
The footwear brand is one of many companies struggling to cope with the current retail landscape.
A number of companies have been slimming down in order to focus efforts on e-commerce, something Aerosoles CEO Denise Incandela says the company wants to focus on moving forward.
“For nearly 30 years, Aerosoles has proudly offered consumers stylish and comfortable footwear at a great value. This restructuring will enable Aerosoles to become a stronger, more vibrant brand, and position the Company for future growth,” said CEO Denise Incandela.
A major aspect of the company’s proposed restructuring is a decrease in the number of retail stores in order to realign the business with the changing marketplace environment, according to the company. Aerosoles has already started store closing sales, and is seeking approval from the Bankruptcy Court to continue the sales.
However, Aerosoles plans to keep four flagship stores in New York and New Jersey, as well as maintain its e-commerce website while the company continues to bolster its digital platform. Aerosoles will also still be available in U.S. retailers.
“By improving our financial structure and right-sizing our retail footprint, we will be able to refocus our business efforts on the execution of our turnaround strategy,” said Incandela. Incandela went on to say that the company will continue to produce fashionable, comfortable product while growing its e-commerce, wholesale and international businesses, as well as promote marketing campaigns that will help bolster business.
Along with filing in Bankruptcy Court, Aerosoles expects to receive approval for a number of motions to help with immediate relief, allowing the company to pay employees and suppliers that will allow the company to continue a seamless operation while restructuring. The approvals requested by Aerosoles are authority to make wage and salary payments, continue a number of employee benefits and honor specific customer programs like gift cards and customer loyalty programs.
Restructuring is expected to be completed within around four months.