(Bloomberg)—Payless Inc., No. 419 in the Internet Retailer 2018 Top 1000, is liquidating its U.S. and Puerto Rico stores and shutting down its online operations as the upheaval in the retail industry claims its latest victim.
The discount shoe chain is starting liquidation sales on Feb. 17, and expects the stores to remain open until at least the end of March, according to a statement. The company was preparing to file for bankruptcy for the second time in two years, people with knowledge of the matter said last week.
The liquidation process doesn’t affect Payless’s franchise operations or its Latin American stores, which remain open for business, according to the statement. The Topeka, Kansas-based retailer has been looking for loans to get through bankruptcy proceedings, the people with knowledge said last week.
Heavily indebted store chains have been going under for two years, claiming once-iconic names like Toys R Us (No. 38). Retailers including Shopko, FullBeauty Brands, Charlotte Russe (No. 763), Things Remembered (No. 462) and The Gymboree Corp. (No. 531) have filed for bankruptcy this year.
Payless was founded in 1956 with the goal of selling affordable shoes in a self-service setting and says it’s the largest specialty footwear chain in the Western Hemisphere. The company struggled to manage debt taken on in a 2012 leveraged buyout by Golden Gate Capital and Blum Capital Partners, filing for bankruptcy protection in April 2017. It emerged with fewer stores, its debt cut in half and creditors owning the company.
Payless employs more than 18,000 globally and operates about 3,600 outlets worldwide, according to its website, with more than 2,700 in North America. The shoe retailer’s five-year compound annual growth rate for online sales was an estimated 17.3% per Internet Retailer’s Top500Guide.com.