Close 500 Stores! Lay Off Tens Of Thousands Of People! Another Big Company Has Collapsed.

4 local time, J.Crew, a well-known clothing retailer, formally filed for bankruptcy protection, becoming the first US retailer to apply for bankruptcy protection in the current round of epidemics.

The retailer said it had reached an agreement with the lender about the debt restructuring and agreed to convert the $1 billion 650 million debt into equity. At present, there are many major retailers in the United States on the brink of bankruptcy. After that, how will the retail industry adjust its strategy?

CNBC Ye Wen Du In the US, J.Crew was once a star brand in the retail market and loved by city white-collar workers. And was attracted by the favour of former first lady Michel Obama.

But for the capital sector, its bankruptcy is not surprising.

So far, J.Crew has been losing money for six consecutive years.   Affected by the epidemic, it closed about 500 stores in March. The company has cut out tens of thousands of employees due to large revenue loss. And decided not to pay the rent for April.

According to the submitted bankruptcy application document, J.Crew predicts that The loss caused by the closure of the store affected by the epidemic is about $900 million.

The company originally hoped to raise funds by splitting sub brand listings, but the outbreak broke the plan and J.Crew had to file for bankruptcy protection.

Global retail business or current bankruptcy

J.Crew is the first major US retailer to apply for bankruptcy protection under the impact of the epidemic, but probably not the last one. The collapse of retail business has begun. Affected by the epidemic, the major global apparel retailers are under tremendous pressure. H&M's stock price has fallen nearly 40% so far this year.

In the United States, at least two big retailers, JCPenny and Neiman Marcus, are reported to be on the verge of bankruptcy.

Bankruptcy protection and asset restructuring are not surprising. Businesses will completely shut down and withdraw from the market. But according to Clearing Corp's Gordon brothers estimate, There will still be as many as 25000 stores in the US permanently closed this year. A real estate service company is also expected. By the end of 2021, stores in American department stores will be closed by half.

Dana Telsey, chief executive of the United States Consultancy Group The longer these stores are closed, the greater the backlog will be, and the greater the discount will be. But no matter when these stores are reopened, they will face high unemployment, which means that these stores will not be able to sell goods at full price, and demand will also be affected. Then there are many retailers down.

Under the epidemic, offline retailers on the US line are widening.

On the other hand, The epidemic also served as a catalyst, exacerbating the gap between the elite and lagging players on the retail runway. During the epidemic period, some retailers on the deep ploughing line, such as Amazon and WAL-MART, were relatively strong and even brightest.

However, there is an industry view that although the online channel is very important, in the United States, it still occupies only about 30% of the total sales. During the post epidemic period, the retailing industry also needs to pay attention to data and attract passengers in an innovative way while ensuring safety.