Women's apparel company to close dozens of stores as it files for bankruptcy after 18 years in busin
A POPULAR women’s apparel company will close dozens of stores after 18 years in business due to filing for bankruptcy.
Soft Surroundings sells a variety of products such as women’s clothes, makeup, and home decor, however, the company announced it will completely restructure its brand.
There are plans to sell the company’s direct-to-consumer assets to another retailer and several brick-and-mortar stores will also be closed.
The retailer’s parent, Soft Surroundings Holdings LLC, filed for Chapter 11 bankruptcy on Sunday in the US Bankruptcy Court for the Southern District of Texas.
Brentwood Associates, a Los Angeles-based private equity firm, owns Soft Surroundings.
The retailer has one store in South Carolina and three in North Carolina, including a Charlotte store which opened in 2016.
READ MORE STORE CLOSINGS
In a press release, Soft Surroundings said that they filed bankruptcy to create a “restructuring support agreement” under which it will sell its assets to Coldwater Creek, a catalog and online retailer.
Through this agreement, Coldwater Creek will continue Soft Surroundings’ “ongoing direct-to-consumer and e-commerce operations,” read the release.
Closing sales are already happening at Soft Surrounding locations, according to the filing.
The company will soon “begin taking steps to reorganize around its direct-to-consumer and e-commerce operations,” read the release.
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Soft Surroundings had 44 locations in 24 states with about 700 employees as of May 2023, said CFO Dan Karpel.
In July, the company filed a Worker Adjustment and Retraining Notification Act (WARN) notice, stating that it would lay off 79 workers at the company’s distribution center in Mexico, Missouri.
More layoffs soon followed with Soft Surroundings calling the move “the beginning of an aggressive new repositioning for the brand.”
This comes just a year after the company’s executive chairman and interim CEO, Bridgit Lombard, reduced inventory and closed a third of Soft Surroundings’ physical locations.
Lombard said this move was to “hyper-focus” on important markets and demographics.
According to the bankruptcy filing, Soft Surrounding Holdings listed its estimated assets up to $50,000 and estimated liabilities between $50million and $100million.
“Over the past year, we have taken significant steps to fortify our financial standing including rightsizing our business to better match current market conditions,” said Lombard in the release.
“Our commitment to our stakeholders has never wavered as we meticulously evaluated the best path forward and are welcoming this next step to financially secure a bright future for Soft Surroundings.
“This will allow us to adapt, restructure, and emerge more resilient, ensuring the longevity of the beloved Soft Surroundings brand for our customers and partners.”
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