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The incredibly rapid fall of discount clothier Steve & Barry's continues.Newsday is reporting that the company told the bankruptcy court that it has no available cash or financing, and that it needs proceedings to be streamlined so it can sell its assets by July 31st. Howard Davidowitz, chairman of Davidowitz & Associates Inc., a national retail and investment banking firm, told Newsday that the move is very unusual, and that it speaks to the tightness of the credit markets and the terrible state of Steve and Barry's finances.
The asset sale will be interesting -- many of the stores will be closed and it's possible that all of them will go. But Steve & Barry's model of ultra low-priced young adult-oriented apparel has value, as do its licensing deals with Stephon Marbury, Ben Wallace, Venus Williams, Bubba Watson, Amanda Bynes, Sarah Jessica Parker, etc. Wal-Mart Stores, Inc. (NYSE: WMT), Sears Holding Corporation (NYSE: SHLD), and every other retailer looking for inroads into the college demographic should be taking a look at this one. Acquisitions rarely create value, but buying this one off the scrapheap would likely entail very little risk.
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Reader Comments (Page 1 of 1)
7-11-2008 @ 9:06PM
dr.sausage said...
last and not too long ago there were raves about their genius and stellar idea.how did they fall so fast?could it be the economy is not what phil grahm says it is?
7-11-2008 @ 9:31PM
bink said...
The economy didn't kill this one, jackass. You're way behind. Check out the blogs on this article:
http://www.bloggingstocks.com/2008/06/21/steve-and-barrys-on-the-brink-of-bankruptcy/
7-12-2008 @ 12:36AM
Bubba_Bitten said...
CLASS ACTION PEOPLE
Thoughts?????????????
7-12-2008 @ 2:00AM
bink said...
I don't think there will be anyone left to sue.
7-12-2008 @ 4:59PM
SB_IS_A_BLOODSCKER said...
True, if no one broke the law with evidence in others hand
7-13-2008 @ 9:19AM
Ex-Senior Executive said...
This company started off with a great idea and business plan. But due to it inability to control vendor expense and overpaying store level management who only avg. less then a year on the job then moved on to other companies. This company would spend about $16,000 or more per manager to fly and train them in New York only to have 50-60% quit in the first 6 months of hiring.
Let's not forget the useless IT support that never had the computer systems working correctly.
If this company focus more on the real issues and not turn a blind eye towards it. They would have seen that they were losing so much money to fraud.
The economy didn't play a big part of this company downfall. Bad business decisions on part of the senior management caused the downfall.
7-13-2008 @ 9:24PM
QuantumLeap_BerlinWall said...
Ex-Senior Exec, I agree with most of what you said (first saw it posted in the other thread). Except I don't think any of the blame deals with us managers in the field. We've had to put up with alot over the years. And once upon a time all new managers were trained in the stores, then some 12 year old Ivy League graduate with 0 retail experience thought it'd be neat to have a "Smartass University". I think the economy has hurt us, but if the company was still being run the way it was before the reins were handed to all of the inexperienced recent college grads we wouldn't be in the situation we're in. I'm just glad that EH came in and molded us into the kind of store he and his buddies could shop in.
7-15-2008 @ 10:20PM
ThankGodIQuitWhenIDid said...
How about the BS Visual Audit Team? Can we say micro management? The company spent countless dollars on this and other BS expenses (NY Training, Hiring expensive top management with NO experience (Can we say Music Degree Eric Hughes)). Apparently, they didn't pay for those either, thanks AMEX! The company should have put more focus in existing stores than opening 5 stores a month. I can remember each time a new store would open in my state, our fixtures would be bare for three weeks because they sent all of the product to the new store. 7 day builds from bare walls had to be extremely expensive as well.