Payless ShoeSource is immediately closing nearly 400 underperforming locations in the U.S. and Puerto Rico after filing for Chapter 11 bankruptcy protection.
Through the bankruptcy process, Payless hopes to strengthen its balance sheet and restructure its debt load.
In addition to the 400 locations that will be closing right away, Payless says it will “aggressively manage the remaining real estate lease portfolio,” which could result in either modified lease terms or the closure of additional locations.
The Topeka, Kansas-based discount shoe retailer has 4,400 stores in more than 30 countries, according to its website.
“This is a difficult, but necessary, decision driven by the continued challenges of the retail environment, which will only intensify,” said Payless CEO Paul Jones. “We will build a stronger Payless for our customers, vendors and suppliers, associates, business partners and other stakeholders through this process.”
Payless said a third party has been hired to oversee the liquidation process for the closing locations, which will include discounting and promotional plans.
Here are some other important things for shoppers to know:
- Gift cards are still valid and will be honored at closing locations
- All purchases at closing stores are final
- Stores that are closing will not be accepting coupons
Is your local Payless closing? Check this list
Payless: We’re not going out of business
If your local Payless store is staying open, the retailer says it will be conducting “normal business operations,” so you may not even notice any difference while shopping.
The company hopes to emerge from the Chapter 11 process in about four months.