U.S. discount shoe retailer Payless ShoeSource intends to close its 2,354 stores in North America, including its only store in the Kawarthas, which is located at Lansdowne Place Mall in Peterborough.
The company filed for bankruptcy protection in both the U.S. and Canada on Monday (February 18), as its retail locations continue to lose money.
“While we have worked diligently with our suppliers and other partners to best position Payless for the future, we have been unable to operate our North American businesses on a sustainable basis,” the company said in a statement.
“As part of the process, we have made the difficult decision to close our stores in the U.S., Puerto Rico and Canada, and we have wound down our e-commerce site.”
Payless says that its U.S. stores are now conducting liquidation sales, and expects liquidation sales to begin in Canada shortly. The liquidation will continue until at least the end of March 2019, with most continuing through to the end of May.
The company also says it is seeking authorization from the bankruptcy courts to honour customer gift cards and store credit until March 11th and to continue to allow returns and exchanges of applicable non-final sale purchases made prior to February 17th until March 1st.
Payless will continue to operate its stores in Latin America as well as its international franchisee stores, which the company claims are profitable.
Payless was founded in 1956 in Topeka, Kansas and was one of the world’s largest shoe retailers. As with many brick-and-mortar retailers, Payless has faced stiff competition from online retailers like Amazon and other discount retailers in the U.S. such as T.J. Maxx.
It emerged from bankruptcy protection in 2017, closing around 900 stores. However, according to the company, “The prior proceedings left the company with too much remaining debt, too large a store footprint.”
Most of the retailer’s 248 Canadian stores, which employ 2,400 people, are located in Ontario. According to court documents, the Canadian stores lost $12 million USD last year, and 220 of the 248 Canadian stores did not make enough sales to pay the current month’s rent.
