The mall just lost another tenant.
Known for their club-ready looks, Bebe plans to close all doors and focus on online sales, according to Bloomberg. The news comes from unnamed sources, who say the contemporary fashion retailer is trying to turn things around without filing Chapter 11, but ultimately, that’ll be up to the chain’s landlords. If the company can negotiate exits for its hundreds if leases, the action won’t be necessary.
Plagued by low store traffic, the company announced a plan to which many other retailers can relate. In November, the company said it would close 16 percent of its retail space in 2017 to cut overhead.
Bebe, known for body conscious, trendy dresses, said in its last earnings report that it was trying to adjust assortments to reflect the more casual nature of women’s tastes these days. Bebe was looking to boost its bottoms business, which had seen success with leggings and denim, and create desirable tops.
The company’s troubles were attributed to a familiar trio: low footfall, changing tastes and the promotional environment.
Womenswear is being hit especially hard by this particular fashion bug. BCBG filed for bankruptcy earlier this month. Wet Seal filed for Chapter 22, the term for a repeat filing, last month. And The Limited was recently rescued in a bankruptcy auction by Sycamore Partners.
Bebe reported comp store sales dropped 10.5% for the second quarter, ended Dec. 28, and the company reported losses of $5.2 million in the quarter, on top of a $5.5 million loss in the previous year’s second quarter.
In June, Bebe entered into a joint venture with brand Bluestar Alliance, which resulted in a $35 million investment in the company. The brand management firm, which owns just under half of the retailer, was to develop an international lifestyle licensing business for the joint venture. This amid questions from investors about the brand’s financial standing and dealings.
Bebe was launched in 1976 by Manny Mashouf in San Francisco to fit between the juniors market and bridge. The 40-year-old chain operates more than 200 full-line and outlet stores and has more than 100 licensed international locations, according to bebe.com.