Deals
Retailers Chasing Fast Fashion Stumble Under Heavy Buyout Debts
- Cash-strapped specialty apparel slow to respond to new rivals
- Business models, not just balance sheets, need restructuring
Visitors to the newly redeveloped Kings Plaza shopping mall in Brooklyn later this year will encounter brand-new, multilevel Primark and Zara stores. Names not on the directory? Debt-laden older brands such as J. Crew, Rue21 and True Religion.
“Euro fast fashion,” featuring trendy clothing that can move from catwalks to stores in mere weeks, has taken the U.S. by storm, and distressed specialty apparel retailers are among the biggest casualties. Their business models and balance sheets are in tatters, especially at smaller and slower chains that jacked up debt during leveraged buyouts.