Around since 1971, women’s fast-fashion chain A’gaci just couldn’t make it to 2020.
The 54-unit operation filed for Chapter 11 bankruptcy court protection on Thursday so it could conduct an orderly wind-down of operations.
The retailer has hired a joint venture of SB360 Capital Partners and Hilco Merchant Resources to help it liquidate the stores. Going-out-of-business sales began Friday at all locations.
The filing wasn’t the first for the specialty chain. It filed its first petition in January 2018, and exited bankruptcy proceedings in August. Now it’s back in bankruptcy, but this time the San Antonio, Tex.-based firm won’t be coming out.
A’gaci’s financial troubles started in part from an aggressive growth target that saw the retailer open 21 new store locations across Arizona, California, Florida, Nevada and Puerto Rico between 2015 to 2017. And the company had to temporarily close 24 locations due to Hurricanes Harvey, Irma and Maria, which hurt many of A’gaci’s most profitable doors in Texas, Florida and Puerto Rico.
While the company was able to exit bankruptcy, it now joins the list of retailers over the last few years who leave court supervision only to find themselves filing a second Chapter 11 petition. And second-time filers, the so-called Chapter 22’s, tend to close up shop. Think Toys ‘R’ Us, Radio Shack, Gymboree, Payless ShoeSource, Charming Charlie and Charlotte Russe.
There’s a chance that some buyer might see value in the intellectual property connected to the nameplate and then bring it back as an online operation, as with Charlotte Russe. If not, however, A’gaci will enter the retail graveyard and be remembered as an early innovator of fast fashion.
The going-out-of-business sale offers discounts of up to 50 percent off original prices. Because the sale is occurring during the back-to-school selling season, the joint venture expects the sale process to wrap up quickly.