Payless ShoeSource filed for bankruptcy protection on Monday, a day after it began winding down its 2,500 U.S. stores.
The retailer, founded in 1956 in Topeka, Kansas, expects all stores to remain open until at least the end of March and the majority until May. That will keep many of its stores open through the Easter holiday, when it generates much of its sales.
Payless said in court documents that many of its stores did not generate enough cash to support the costs of sourcing, design and merchandising.
The liquidation will not impact its franchised or Latin American stores, where it is the region’s largest specialty footwear retailer. Payless said in court documents that is looking to reorganize its Latin American and franchise businesses, which include looking for capital to support those businesses.
The filing marks its second trip to bankruptcy court. It first filed for bankruptcy protection in April 2017, eliminating nearly 700 stores and roughly $435 million in debt.
But the shoe retailer continued to face challenges, with competition ranging from Amazon to T.J. Maxx parent TJX Cos. to shoe retailer DSW. Payless had a loss of $63 million in 2018 and a loss of $4 million in 2017.
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