Retail Industry Bankruptcies Toolkit
Resources addressing strategies, challenges, and in-depth analysis of issues involving the representation of debtors and creditors in retail business bankruptcy proceedings.
Shifts in consumer shopping habits and the continued growth of e-commerce have left retail chains financially unstable, forcing many brick-and-mortar retail chains to file for bankruptcy to restructure or close their doors. Due to market factors and certain Bankruptcy Code ( www.practicallaw.com/7-382-3256) provisions and requirements, retail debtors and creditors face challenges that are unique to retail Chapter 11 ( www.practicallaw.com/1-500-6505) proceedings, including:
An inability to replenish inventory due to a lack of DIP financing ( www.practicallaw.com/0-382-3405) .
Large administrative claims ( www.practicallaw.com/9-382-3217) from vendors that shipped goods within 20 days of the petition date ( www.practicallaw.com/4-616-4432) (§ 503(b)(9), Bankruptcy Code).
Strict time limits to reject or assume executory contracts ( www.practicallaw.com/4-529-3005) and unexpired leases (§ 365(d)(4), Bankruptcy Code).
Reclamation ( www.practicallaw.com/5-382-3733) claims and adjusted payment and credit terms.
Experts continue to believe that the retail industry will continue to accumulate substantial financial losses because of:
Changing market trends.
Shifting consumer sales from traditional retailers to a proliferation of online resellers.
Increased competition from other full-line and specialty retailers.
These elements will likely lead more retailers to seek Chapter 11 relief to liquidate, reorganize ( www.practicallaw.com/4-382-3757) , or sell their assets through a section 363 sale ( www.practicallaw.com/0-386-0841) .
This Toolkit contains continuously maintained practice notes, standard clauses, standard documents, checklists, and toolkits to help debtors and creditors develop strategies both before and during a retail business's bankruptcy proceedings.