To definitely nobody’s surprise, Pier 1 Imports is being sunk.
It told the insolvency court where it has actually been since filing chapter 11 earlier this year that it would start a total liquidation of its operations, shutting all its shops and sailing off into the sundown.
It will not be a bon voyage.
The schedule for the failing process is still to be identified however in a bizarre and somewhat ironic twist that defines the present crisis the selling company is trying to deal with, the company will start to resume its stores … so it can close them. When it declared personal bankruptcy in January Pier 1 said it would close about half its stores, 450 or two, but try to keep the rest functional, wanting to find a purchaser or some sort of strategy to remain in service. But then came the coronavirus and all plans went out the window. All 900- plus stores were closed and the liquidation sales that might have raised some cash for any ongoing endeavor were stopped.
It was a terrible development but Pier 1’s statement that the pandemic was the reason for its crisis rings hollow. “Eventually, due to the mix of a challenging retail environment and the brand-new truth and uncertainty of a post-COVID world, the business and its advisers determined that an organized wind-down is the very best method to make the most of the value of Pier 1’s properties,” the business said in a press release.
Even blaming it on the retail environment is more than a little bit of an excuse. Pier 1’s problems that got them to this point are mostly self-made and the company’s executives and board need to bear the ultimate responsibility. In no particular order, here are the key factors there will no longer be a Pier 1:
– The revolving door of executives who have actually run Pier 1 over the past decade has actually been extreme, even by struggling retailer requirements. Every time a brand-new chief honcho came along, he offered all the reasons the man before him stopped working and laid out his prepare for making things right. Usually, in 18 to 24 months that guy was gone too and the decrease continued. Pier 1 was drawn in so many different directions it’s a marvel it lasted this long.
– A little over a years earlier, one of those brand-new CEOs– it’s hard to keep track of which one– revealed he was shutting down the company’s e-commerce operation to focus on its shops. By the time the next president came along and reversed course rebooting online sales, Pier 1 had lost years and years and it never truly caught up.
– Even with seemingly more attention on its stores, Pier 1’s physical fleet was really exhausted and very much in the incorrect location. Its stores were still based upon layout from decades ago and they were awkward and ill-suited to modern shopping. The treasure hunt strategy held true in name just: it was a hunt to try to find anything. The shops themselves were also located for a retail landscape of yesteryear. A lot of shops were located nearby or nearby B, C and D shopping malls which were bleeding clients as the rest of retail contracted. Pier 1 was entrusted to hundreds of stores near dead malls.
– Inside the shops, the product was just wrong. The shop was over-inventoried in some categories like scent diffusers and under-represented in others where it must have been so much stronger, like kitchenware. Many furniture on the flooring was in one style– boho-meets-third world– and usually broken or inadequately put together. Dec pillows, which should have been among the core classifications in the store, were frequently relegated to odd corners of the area. And while Pier 1 was mostly personal label when it did get a hot brand name like Joanna Gaines’ Magnolia Home it never ever exploited it with the appropriate point-of-sale merchandising. Compare a Pier 1 store with the excellent house decoration departments at Target and what’s wrong becomes painfully apparent.
– Finally there was the total lack of understanding of its consumer base. When one brand-new CEO came in– again, hard to tell them apart without a scorecard and a severance package– he came to the fantastic deduction that the seller had actually been focused on the incorrect sub-set of selling for years.
The long list of Pier 1 bad decisions, poor management and failure to adapt to the altering marketplace goes on and on. Unfortunately, the store itself will not.