David’s Bridal Files for Bankruptcy, Plans to Lay Off 9K Workers
The wedding dress retailer said it is evaluating its network of around 300 stores as it looks for a buyer.
The announcement came two days after the bridal giant said it would lay off 9,236 workers nationwide in phases beginning now through mid-August, according to a Pennsylvania WARN notice.
David’s Bridal has around 10,000 employees, including 2,000 full-time and 8,000 part-time workers, as per court filings.
Its stores will remain open throughout the bankruptcy proceedings, said the company, and it expects to fulfill all customer orders “without disruption or delay.”
Its online platforms and vendor marketplace remain available, and members of its Diamond loyalty program can continue to earn and redeem awards. Gift cards, returns, and exchanges also will continue to be honored.
David Bridal’s said it is re-evaluating its network of around 300 stores. If it does not find a buyer, it would likely prepare to wind down its operations, according to court filings.
It has 294 stores in total, including 278 in the U.S., 12 in Canada, and four in the U.K.
In a statement, David’s Bridal CEO James Marcum said the company has taken steps in recent years to modernize its stores and systems to provide top-level service to brides-to-be.
The retailer announced plans for a new store format late last year, and has added new offerings, like a fragrance collection, a wedding planning platform, a prom season pop-up, and an “eco-minded” bridal collection.
It also announced a partnership with Diamond Nexus, which sells lab-grown diamonds, diamond simulants and moissanite.
One in four U.S. brides wear a David’s Bridal gown at their wedding, said Marcum in court filings, while 87 percent visit the company’s website at least once during the wedding planning process.
“Nonetheless, our business continues to be challenged by the post-COVID environment and uncertain economic conditions, leading us to take this step to identify a buyer who can continue to operate our business going forward,” said David’s Bridal in a statement.
While the number of weddings spiked last year, the increase mostly was due to pent-up demand from the pandemic and likely does not signal a long-term, significant increase in the number of U.S. couples getting married.
In Signet Jeweler’s most recent fiscal year results, the company said its engagement ring sales struggled, down by low double digits for the year, a pattern it expects to repeat in fiscal 2024.
The jewelry giant said the pandemic impacted the formation of new relationships and, thereby, engagements, though it thinks the slowdown is temporary. A rebound is expected to begin at the end of the next fiscal year.
David’s Bridal’s Chapter 11 filing lists its estimated liabilities to be in the range of $100 million to $500 million, in line with its estimated assets.
The company has $256.9 million in debt, as per court filings.
The company said it is seeking authorization to pay its employee wages and benefits, maintain select customer programs, and pay “critical” vendors.
It won court approval Monday to borrow as much as $85 million to keep operations running during the proceedings.
David’s Bridal previously filed for bankruptcy in 2018, weighed down by debt and lagging wedding dress sales. It emerged from bankruptcy the following year.
U.S. corporate bankruptcies are on the rise in 2023, according to S&P Global Market Intelligence data, with the first two months of the year clocking the highest number of bankruptcies for any comparable period since 2011.
In January, 54 bankruptcy petitions were filed, and, in February, 57 were filed, the most in a month since March 2021.
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