Fashion retail takes another hit
The Short Version
Less than two weeks after American Apparel announced the closing of all its stores, teen-focused retailer Wet Seal announced yesterday that they are closing all 173 stores after failing to find an investor or alternative source of capital to continue funding operations. The closure marks another serious blow to traditional retail fashion as fast-fashion stores such as H&M and Forever21 continue to dominate the sector.
A Longer Look
You probably saw this coming. As much as no one wants a store to close, most the time, the emptiness of your local mall stores are a good indicator of what’s not going on. Namely, no one is shopping traditional mall fashion stores. All the places that were hip and cool 10-15 years ago are not only yesterday’s news, they are on their death beds and no one is bothering to plug in the breathing machines to help them survive.
Wet Seal, for those of you too old to know, was a hip, cool teen-focused retailer that emerged in the 90s as one of the top places to find the clothes that your parents didn’t want you to wear. Fishnet shirts, leather skirts, and those big, chunky boots that were a staple of the turn-of-the-century looks were all found in the store that seemed to have Alanis Morisette on infinite loop.
Wet Seal filed for bankruptcy a couple of years ago and was bought by a private equity firm for a mere $7.5 million. They closed nearly 400 stores right off the bat, but kept the most profitable 150. The hope was that new management would be able to turn the store around. However, it takes more than a new VP or two to make the changes that fashion retail needs to make. Without an entirely different approach to fashion, the stores were doomed. No one wants their fishnet and chunky boots anymore.
The letter went out to store employees last Friday. A notice filed with the state of California said that job losses were permanent and that the company would be ceasing operations. The letter to employees said that the company had been able to find any sources of capital for continuing operation. There is no immediate word as to how quickly stores are being liquidated or how. If you find one open, you might want to grab what you can before they’re gone for good.