Pier 1 May Be the Saddest Story of This Bankruptcy Boom
Why J. Crew and Chuck E. Cheese aren’t disappearing, but the retailer behind the papasan chair is
Somewhere around April this year, production of Pier 1 Imports’ famous papasan chairs ceased.
So did everything else in the retailer’s manufacturing supply chain, as the company discontinued all purchase orders early that month. “We didn’t want to impact our vendors by having product in production that we weren’t gonna take,” chief executive Robert Riesbeck tells Marker. Pier 1 will sell the papasan chairs and other products in its stores and distribution centers, aiming to clear every last item in by the fall. And that will be that. The retailer, a familiar presence in strip malls and shopping centers for decades, is liquidating.
A slew of household-name businesses have declared bankruptcy since pandemic-related shutdowns beginning in March gutted the American economy. It’s happened across categories. J. Crew, J.C. Penney, Lucky, Chuck E. Cheese, Hertz, Gold’s Gym, GNC, Neiman Marcus, Le Pain Quotidien, the largest Pizza Hut franchisee, and the list goes on. It’s widely assumed this is just the beginning.
The public square of social media lately has been full of nostalgic and emotional laments for their most adored (and sometimes, maligned) brands seemingly evaporating into thin air: “Well, La Pain Quotidien, I will miss you.” “JCrew bankrupt. RIP barn jackets and heather sweaters.” “Chuck E. Cheese just filed for chapter 11. The end of an era.” Others are less sentimental, but just as definitive: “The end of J. Crew was inevitable,” Jezebel declared.
But in reality, these bankruptcies do not mean that all of these brands will simply disappear. It’s not likely that we will wake up soon to a world with no J. Crew or Pizza Hut. Chapter 11 has often been misconstrued by the public as immediate and dramatic confirmation that a company is shutting down altogether — as happened in recent years with Toys R Us, Barneys, and Payless Shoes. In reality, Chapter 11 is a financial tool that can buy a distressed company a second chance: The bankruptcy process gives it the opportunity to rejigger its debt arrangements, slash costs, restructure real estate and other commitments, agree…