David’s Bridal, a privately owned specialty retailer, will be forced to close all of its stores unless it finds a buyer to continue operating the bridal chain. Despite its efforts to find a buyer, the company was forced to file for bankruptcy.
According to a filing by CEO James Marcum in the U.S. Bankruptcy Court in Trenton, New Jersey, if it is unsuccessful at securing a buyer, the retailer says it will wind down its operations with assistance from liquidation firm Gordon Brothers Retail Partners.
At the time of the filing, David’s Bridal recorded having a cash reserve of only $4.4 million. To ensure that the sale process continues smoothly, the company has obtained loans from its existing lenders on revolving credit lines, such as Bank of America, that add up to $85 million.
Despite being a major supplier of wedding gowns to 25% of brides in the U.S., the filing marks David’s Bridal second attempt at Chapter 11 in under five years, according to Marcum. David’s Bridal’s decision to file for bankruptcy is a result of the lasting impact of the pandemic and shifts in consumer behavior. The national wedding rate has declined to its lowest point in 121 years, and it has continued to remain below average. According to Marcum, the company’s research and multiple sources indicate that in 2022, there were 1.9 million weddings, compared to the pre-pandemic average of 2.2 million annually.
Moreover, the court filing indicated that the growing popularity of nontraditional wedding attire has had a detrimental effect on the gown business, resulting in a decline in store traffic. In-store appointments dropped by 22% in the fourth quarter of 2022, according to court papers.
Despite reducing its debt by over $434 million during its previous bankruptcy and maintaining a large store presence, David’s Bridal experienced a decline in customer confidence as a result of the bankruptcy. To date, the Conshohocken, Pennsylvania, retailer has 294 stores across the United States, Canada, the United Kingdom, and franchise stores where it sells its wedding apparel.
