Midwest Off-Price Retailer Gordmans May Be In Financial Trouble

Image courtesy of Nicholas Eckhart

So far this year, several national retailers have filed for bankruptcy and closed some, if not all, of their doors. But it’s not just mega chains like Kmart, Macy’s, and The Limited that are hurting, regional chains are also feeling the pressure. To that end: off-price department store chain Gordmans is reportedly preparing to file for bankruptcy. 

Bloomberg, citing people familiar with the matter, reports that Midwest chain Gordmans could file for bankruptcy as soon as this month.

A rep for Gordmans tells the Omaha World-Herald that it does not comment on rumor and speculation.

Like other retailers, the Nebraska-based company, which currently operates 106 stores in 22 states, has been the victim of changing customer shopping preferences.

Gordmans was purchased by private equity firm Sun Capital Partners in 2008. In the following years, the company increased sales by 30%, according to Gordmans.

However, those increases didn’t last, Bloomberg reports, noting that sales began to slow in 2014. More recently sales for the chain have fallen more than 75% in the past year.

Last year, the company’s stock fell below $1 and Nasdaq threatened it with delisting, Bloomberg reports, adding that the retailer holds an estimated $85 million in debt.

The World-Herald reports that the company also laid off an undisclosed number of employees in January because of the sluggish retail environment.