Century 21 has 13 stores, mostly in New York and the surrounding area. The company blamed the failure to pay its business interruption insurance as the cause of her death.
Department store chains are struggling even before the Covid-19 pandemic caused stores to close temporarily and redirect more purchases online. Clothing stores that depend on clothing sales, such as Century 21, are particularly affected, as millions of people are out of work and millions of others work from home and do not need to buy as many clothes.
Larger national department stores, such as JCPenney, Neiman Marcus and Lord & Taylor, filed for bankruptcy during the pandemic, with Lord & Taylor announcing its own plans to shut down.
said the latest straw was the fact that it had not received the $ 175 million it applied for under its business interruption insurance. It says politics saved him after the 9/11 terrorist attacks – there was a shop just across the street from the World Trade Center that was destroyed. But he said he failed to receive payment this time.
“We now have no viable alternative but to start closing our beloved family business, because our insurers, to whom we pay significant premiums each year for contingency protection as we have today, have turned their backs on us the most critical time,” he said. Century 21 CEO Raymond Gindi.
Many insolvency companies use the process to release debts and other liabilities and stay in business. JCPenney and Neiman intend to stay in business. Some, including most American airlines and General Motors (GM), came out of bankruptcy and continued to record record profits. But retail success stories are harder. Century 21 stated that without the insurance money it believes was due, it would make sense to proceed directly to liquidation.
“While retailers have been hit hard by Covid-19 … we are confident that if we received some significant portion of insurance revenue, we would be able to save thousands of jobs and weather the storm.”