Ten Retailers Possibly Filing for Bankruptcy in 2024

2024 holds much anticipation. The Fed rate hikes have started to reduce inflation, yet some prices remain high. Unemployment figures persist at record lows despite many large employers cutting back. Continuing supply chain issues persist as China reopens in the face of its COVID crisis. And consumer spending is tightening in preparation for bumps in the year ahead. Will we avoid a recession and have a soft landing? This volatile mix of economic data may lead several retailers to use the bankruptcy process to stay viable.

Following are our top 10 retailers to watch for a possible Chapter 11 filing in the year ahead.

  1. Petco – Is Fido Chasing a Chapter 11 Bone? According to Retail Dive, the company has a high long-term debt load of $1.7 billion. According to iHeart, the company’s FRISK Score at the end of last year was 2 with CreditRiskMonitor, which represents a 4% to 10% chance of bankruptcy in the next 12 months. These factors could lead the 1,500 store chain to think about reducing its footprint through a bankruptcy filing.
  2. JOANN – Crafting a Chapter 11 Plan? Retail Wire reports that Jo-Ann Fabrics, now known as JOANN, continues with declining sales,
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Here’s how to get your money back if a business shuts down or files bankruptcy

NORFOLK, Va. — Phillip Coe, an Army veteran, says he was looking forward to escaping the day-to-day by taking a trip to San Juan, Puerto Rico.

He booked the trip in 2019 with a travel agency that specifically helps military members and their families.

Coe says the final cost, including airfare and a hotel, came out to $1,137.65. However, before the 21-year Army veteran could make the trip, there was the pandemic and then he was diagnosed with cluster headaches, in addition to his leukemia.

“They call them suicide headaches and if you’ve ever had one, you know why,” he says. “Cluster headaches are very painful. They come on one side of your head, and you never know when you are going to get them. It just ruins your whole life.”

He shared a medical statement from his neurologist with me, which says

“Mr. Coe is an active patient at this facility’s neurology clinic due to a diagnosis of cluster headaches. Traveling at high altitudes affects cerebral blood flow and is known to trigger an attack of cluster headaches. Due to this condition, Mr. Coe was advised and will no longer be able to fly on any aircraft.”


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An Illustrated Guide to Corporate Failure

Traders and lawyers know when a company is about to go under. So should you.

Illustration: Cath Kastner

“Bankruptcy” is a dirty word in boardrooms, on trading floors and in ­employee break rooms. There’s good reason: Insolvency tarnishes reputations, wipes out stockholders and kills jobs. Thankfully, corporate failures are rarely surprising to those who know what to look for. Close observers fully expected the recent bankruptcies of coworking giant WeWork Inc. and pharmacy chain Rite Aid Corp. Almost 200 companies with debts of at least $50 million declared bankruptcy this year—the most since the global financial crisis, except for 2020, during the Covid-19 pandemic. The wave shows no signs of ebbing as high interest rates weigh down corporate balance sheets. So how do you know if a company is about to go under? Read on.

Stock, bond and loan prices are the quickest way to spot a troubled company. When brokers offer floating-rate loans for less than 80¢ on the dollar, there’s little doubt the borrower is struggling. That price means lenders don’t expect the debt to be repaid in full. Almost a year before Rite Aid

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WeWork Catches Its Breath After Reaching Bankruptcy Agreement with 18 Landlords

After months of impasse, office space retailer WeWork has finally come to a resolution with a group of 18 landlords who have insisted that the company pay the rents to its abandoned leases in full.

As part of the agreement overseen by U.S. Bankruptcy Judge John Sherwood, WeWork’s majority shareholder SoftBank, the Japanese investment company, will redirect up to $682.5 million into new credit facilities to act as a backstop for WeWork’s rent obligations. According to Sherwood’s order, landlords cannot draw from those letters of credit en masse at the end of the month, an option they likely would have taken if WeWork defaulted.

WeWork’s landlords had previously objected to this plan, worrying that debtor-in-possession financing would leave them empty-handed should WeWork’s Chapter 11 restructuring go awry. Attorneys representing the landlord insisted that SoftBank should advance new money as part of the agreement. But earlier in the week, Douglas Rosner, an attorney representing the 18 of those landlords, told Reuters that WeWork and Softbank revised the package to address their concerns.

The group, which includes Beacon Capital Partners LLC, Boston Properties, Nuveen, and other backers, continued to express concerns about how they might stay in control in a volatile situation.

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SmileDirectClub Shuts Down, Months After Filing for Bankruptcy

SmileDirectClub, a telehealth company that sold teeth-straightening devices through the mail and faced criticism from medical groups, said on Friday that it had shut down.

The company, founded in 2014, sold teeth aligners online and in its shops for $1,850. It marketed them as a faster, cheaper alternative to braces. SmileDirectClub’s initial public offering in 2019 valued it at $8.9 billion.

SmileDirectClub served more than two million customers over nearly a decade. But the company was not profitable and filed for Chapter 11 bankruptcy in September with nearly $900 million of debt, court filings and financial statements show. And this year, it settled a lawsuit from the District of Columbia attorney general’s office that had accused the company of using confidentiality clauses to stifle consumer criticism.

On Friday, SmileDirectClub” title=””said on its website that it was shutting down its global operations immediately. It apologized to customers for the inconvenience, and urged them to consult a doctor or dentist about future treatment.

Outstanding orders have been canceled, the company said. Customers on a monthly installment payment plan are expected to continue making all of their payments. Those who have completed treatment will no longer qualify for

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