Bebe to shutter all of its stores
Bebe Stores (BEBE) says its clothing brand was inspired by Shakespeare’s famous “to be, or not to be” soliloquy from Hamlet. On Friday, the company settled that eternal question on the side of “not to be” for its retail locations.
The retailer said it will close its more than 160 retail locations, becoming the latest retailer to suffer from the slings and arrows of online competition and changing consumer tastes. Bebe expects to close the stores by the end of May, according to a regulatory filing on Friday. The filing didn’t specify whether it will continue as an online-only retailer.
The decision sent the company’s shares down more than 13 percent in Friday morning trading, before the stock bounced back slightly to $3.50.
Bebe has suffered declining sales, prompting it to hire a financial adviser in March to explore strategic alternatives. Retailers including Sears (S) and Macy’s (M) are among the other large brick-and-mortar retailers also struggling with changing tastes in styles and shopping preferences.
Bebe is among the retailers singled out this month by S&P Global Market Intelligence as one of the most likely to suffer a default or liquidity event.
“The shift to online shopping has left a lot of financial distress in its wake, especially for brick-and-mortar retailers such as Sears and Macy’s, and the results from the first quarter do not suggest that a quick recovery is on the horizon,” Jim Elder, director of risk services at S&P Global Market Intelligence, wrote in a research note.
Bebe said it expects to record an impairment charge of about $20 million because of the store closings. According to its website, Bebe operates 134 retail stores and 34 outlet stores, as well as bebe.com.
