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Daffy’s May Not Pay Invoices

Recent reports indicate that discount retailer Daffy’s is having severe financial woes. According to WWD, buyers were told to “go on vacation,” recent orders have been canceled, and Daffy’s might be refusing to pay its May invoices. Crain’s New York Business reported that the company is having trouble paying its vendors, but the company refused to comment.

Daffy’s has 19 stores in the New York area, including a new 17,000 square foot location in Times Square. The company generated $155 in revenue last year, but may be burdened by underperforming stores. They are also suffering from overpriced merchandize and have failed to respond to recession era changes in consumer behavior.

Revenues at Daffy’s have failed to grow in recent years, despite opening new stores. Expenses have gone up without sales improvement and it may have forced the company into a cash crunch. Rumors that invoices will not be paid are troubling to vendors who often use Daffy’s as a buyer of last resort for unsold goods.