The first quarter of 2007 was remarkable in that there were no retailer bankruptcies of note--a positive sign for the rest of the year, even in the face of April's disastrous same-store sales. (ICSC's metrics showed a drop of 2.3 percent year-over-year, the largest decline since same-store sales trends starting getting measured in 1970).
Now, however, electronics seller Tweeter may break that trend. The struggling retailer already has announced plans to close 49 of its 153 stores, cut 20 percent of its staff and leave the California and Tennessee markets entirely. But the firm is said to now be considering filing for bankruptcy protection.
On Thursday, Joe McGuire, Tweeter's president and CEO, said the company does not have enough capital to pay for the upfront costs of store closings nor its "long-term cash needs."McGuire told The Associated Press that the company has reached settlements with about one-third of the landlords at its closed stores. If the company can reach "favorable" deals with the remaining property owners, it may avoid bankruptcy, he said.
"Despite today's announcement, the store closing process is going pretty well and our focus on providing a service to a very high end of consumer remains intact, whether we have to access the courts or not," McGuire said.