Off-price is a trading format based on discount pricing . Off-price retailers are independent of manufacturers and buy large volumes of branded goods directly from them. The off-price retail model relies on the purchase of over-produced, or excess, branded goods at a lower price, thus being able to sell to consumers at a discount compared to other stores which purchased an initial run. Among the largest retailers of this type are TJX Companies and Ross Stores . The model is more common in countries that import fashion -oriented or household goods, as the discount role in producer countries is usually filled by factory outlets or small-scale open-air marketplaces .
105-667: Stage Stores was a department store company specializing in retailing off-price brand name apparel, accessories, cosmetics, footwear, and housewares throughout the United States. Stores were usually located in shopping malls and centers or in standalone locations. The corporate office was located in Houston , Texas . Stage Stores operated 782 department stores in 42 states, almost all of which were eventually converted to their flagship brand, Gordmans , which it acquired in 2017. Historically, Stage Stores operated full-price retail outlets under
210-731: A 2005 study claimed the drop may have been due to an increase in the incorrect classification of many bankruptcies as "consumer cases" rather than "business cases". Cases involving more than US$ 50 million in assets are almost always handled in federal bankruptcy court, and not in bankruptcy-like state proceeding. The largest bankruptcy in history was of the US investment bank Lehman Brothers Holdings Inc., which listed $ 639 billion in assets as of its Chapter 11 filing in 2008. The 16 largest corporate bankruptcies as of December 13, 2011 Enron, Lehman Brothers, MF Global and Refco have all ceased operations while others were acquired by other buyers or emerged as
315-441: A Chapter 11 bankruptcy, the debtor corporation is typically recapitalized so that it emerges from bankruptcy with more equity and less debt, a process through which some of the debtor corporation's debts may be discharged. Determinations as to which debts are discharged, and how equity and other entitlements are distributed to various groups of investors, are often based on a valuation of the reorganized business. Bankruptcy valuation
420-592: A Marshalls ex manager, Bernard Cammarata, to create a clone of Marshalls. TJ Maxx , the name of this store, was opened in March 1977 – and it was followed by a series of other openings for the brand-new network. These stores became popular overnight, offering quality clothes at reasonable prices and a constantly updated range of products to the USA’s growing population. A few years after these events, Zayre Corp began to develop yet another line of business, – by providing customers with
525-914: A buyer. On October 21, 2020, Stage sold its intellectual property and a distribution center in Texas to Florida-based Bealls, Inc. for $ 7 million. Notably, this allowed the Florida chain to use the Bealls name nationwide; previously, Stage owned the rights to the Bealls name nationwide, except in Arizona, Florida and Georgia. Bealls also acquired the rights to the names of Stage's other chains, as well as all of its private label brands and customer lists. In 2022, New York-based online company BrandX acquired Stage Stores, Goodys, Gordmans, Palais Royal, and Peebles, as well as their private brands and plans to relaunch them online. Off-price The term applies to fashion retail . Off-price
630-399: A daily basis. The Nordstrom off-price turnover as of 2017 is almost 5 billion dollars. The company Tuesday Morning also operates in the off-price segment. It has existed since 1974 and as of 2018 operates 730 stores in the U.S.A. The network specialises in home deco, gifts and toys. It offers discount pricing of 20-60%, and its annual turnover is 1 billion dollars. The company doesn't have
735-478: A former factory outlet at 675 thousand dollars, by making a down payment of 75 thousand dollars that she had saved through her work. In 1975 the company opened its second store. By 1983 the network had reached 31 shopping points. In 2006 it was acquired by Bain Capital Partners at 2 bln dollars and proceeded with its vigorous development. Right after Burlington was founded in 1975, one more player arrived to
840-500: A higher price for divisions or other assets than a chapter 7 liquidation would be likely to achieve. Section 362(d) of the Bankruptcy Code allows the court to terminate, annul, or modify the continuation of the automatic stay as may be necessary or appropriate to balance the competing interests of the debtor, its estate, creditors, and other parties in interest and grants the bankruptcy court considerable flexibility to tailor relief to
945-431: A higher pricing segment and a wider lineup of jewelry and accessories. In Marshalls a greater range of footwear is available along with clothes for men and young men. TJ Maxx launched a web store launched in 2009. Initially it only sold baggages, but it gradually widened its assortment to include clothing, footwear, jewelry, accessories and household appliances. Cumulative turnover of both networks according to 2017 statistics
1050-407: A network of department stores providing sales for the whole family and a wide range of clothing and footwear from popular Russian and foreign trademarks. The company gradually transformed into an off-price retailer on honing its strategy based on the work of worldwide off-price giants Ross Stores and TJ Maxx. They adapted their practice to take into account their market’s local features. In 2016 Familia
1155-489: A network of discounters offering clothes, shoes, accessories and homegoods from international and national brands with discounts reaching up to 60% of the regular retail prices. As of early 2018, there are 38 off-price department stores operating in Australia under TK Maxx brand. In New Zealand the off-price format appeared in late 2018, when a local group of companies The Warehouse Group , specialising in discount trading, made
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#17328583994921260-776: A period of rapid growth. During WW1 and WW2 the U.S.A. became isolated from the major European suppliers of textile and sewing machinery - and, as such, domestic manufacturing began to increase. In the 50s, a huge amount of clothing, footwear and other sewn products were manufactured locally, and by the end of the season factories were prepared to announce substantial cut-offs and sell the unsold remnants on their own. Small business entrepreneurs would buy products out at wholesale prices and arranged their own retail sales in vacant factory workshops and other rooms that were cheap enough to rent. As their businesses grew, they expanded by moving to department stores or indeed building their own stores. In 1956, U.S. businessman Alfred Marshall put together
1365-427: A plan. If the debtor proposes a plan within the 120-day exclusivity period, a 180-day exclusivity period from the date of filing for chapter 11 is granted in order to allow the debtor to gain confirmation of the proposed plan. With some exceptions, the plan may be proposed by any party in interest. Interested creditors then vote for a plan. If the judge approves the reorganization plan and the creditors all agree, then
1470-404: A profit. The trustee or debtor-in-possession normally rejects a contract or lease to transform damage claims arising from the nonperformance of those obligations into a prepetition claim. In some situations, rejection can also limit the damages that a contract counterparty can claim against the debtor. Chapter 11 follows the same priority scheme as other bankruptcy chapters. The priority structure
1575-418: A reorganization process for the majority of private individuals. When a business is unable to service its debt or pay its creditors , the business or its creditors can file with a federal bankruptcy court for protection under either Chapter 7 or Chapter 11. In Chapter 7, the business ceases operations, a trustee sells all of its assets, and then distributes the proceeds to its creditors. Any residual amount
1680-697: A second hypermarket was established in Boston. Its area was approximately 39,000 square feet (3,600 m ). By 1959, the company had opened six stores all under the Zayre name, and by early 1962 their number reached 27. The same year, Zayre Corp became a public company and commenced trading on the New York stock exchange. By late 1966, the network had grown to 92 stores all over the United States. Shoppers could find lowered price tags on knitwear, toys, sports products, books, health & beauty products and many more categories. In 1965,
1785-522: A secured party with an interest in an aircraft the ability to take possession of the equipment within 60 days after a bankruptcy filing unless the airline cures all defaults. More specifically, the right of the lender to take possession of the secured equipment is not hampered by the automatic stay provisions of the Bankruptcy Code. In August 2019, the Small Business Reorganization Act of 2019 ("SBRA") added Subchapter V to Chapter 11 of
1890-440: A series of acquisitions the company grew to 793 stores as of July 29, 2017. In June 1992, Stage Stores, then known as Specialty Retailers, Inc. (SRI), acquired Colorado-based Fashion Bar , Inc., a family-owned business with 71 stores, most of which were comparable to Palais Royal and Bealls . The remainder were small specialty stores known as Stage Stores, which had already become part of SRI's operation. In 1996, SRI completed
1995-558: A successful reorganization and retain control of the business and increase oversight and ensure a quick reorganization. A Subchapter V case contrasts from a traditional Chapter 11 in several key aspects: it is earmarked only for the "small business debtor" (as defined by the Bankruptcy Code), so, only a debtor can file a plan of reorganization . The SBRA requires the U.S. Trustee appoint a "subchapter V trustee" to every Subchapter V case to supervise and control estate funds, and facilitate
2100-515: A think tank of entrepreneurs and suggested the launch of a start-up with the concept of “brands at lower prices”. Having observed a post-war economic boom and the development of the American suburbs, they decided to capitalise on these phenomena to establish new business. They opened a self-service department store in Beverly in order to propose clothing and household products at tempting lower prices. Part of
2205-466: A tool for escaping labor contracts, usually 30–35% of an airline's operating cost. Every major US airline has filed for Chapter 11 since 2002. In the space of 2 years (2002–2004) US Airways filed for bankruptcy twice leaving the AFL–CIO , pilot unions and other airline employees claiming the rules of Chapter 11 have helped turn the United States into a corporatocracy . The trustee or debtor-in-possession
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#17328583994922310-502: A web store, rather an online showcase. U.S. Retailer Century 21 network offered clothing, footwear, & well-known brand accessories with a discount of up to 65%. The network began growing in 1961 with a store of 6 000 sq. feet in Manhattan. In 2018, the retailer had 16 retail department stores in the US. Century 21 closed all of its locations by Sunday, December 6, 2020 as a result of Insurance companies failing to financially support
2415-545: A web store. As of 2018 the retailer has 38 “pop-ups” and 13 permanent off-price stores, and the company claims to be planning to increase its number of pop-ups – up to the total time of their working which makes 11 thousand days a year. Chapter 11, Title 11, United States Code Chapter 11 of the United States Bankruptcy Code ( Title 11 of the United States Code ) permits reorganization under
2520-531: Is NOZ, which operates in France and has over 300 stores within its network, as of 2018. In recent years the company has opened 2 stores per month on average. NOZ offers mainly clothing, accessories, personal hygiene and cosmetics products, food, sports equipment, garden and household products including furniture, electronic appliances, dishes and deco goods. Annual turnover of the company is valued at 500 mln euros, and their suppliers total 110 000. NOZ notes that its purpose
2625-399: Is defined primarily by § 507 of the Bankruptcy Code ( 11 U.S.C. § 507 ). As a general rule, administrative expenses (the actual, necessary expenses of preserving the bankruptcy estate, including expenses such as employee wages, and the cost of litigating the chapter 11 case) are paid first. Secured creditors —creditors who have a security interest , or collateral , in
2730-1056: Is different from other special pricing formats (such as outlet store and discount store ) in that one store might contain a great deal of products, price rates and trademarks. The range of goods is usually measured in millions of product items, whereas the quantity of brands represented is measured in thousands. The discount amount is 60-65% on average, reaching up to 90% of the initial price of similar products in brand stores of their respective trademarks and multi-brand boutiques. Off-price retailers sell products by popular brands, purchased directly from their trademark owners, distributors and manufacturers. This model keeps off-price networks protected from goods of unknown origin, guarantees their quality and ensures competitive pricing when placed beside other points of sale. Off-price retailers buy overproduced or unsold goods, showroom remnants of collections from their respective brand owners or brand stores and distributing networks under certain terms and conditions in order to offer them to their final consumer with
2835-442: Is given the right, under § 365 of the Bankruptcy Code, subject to court approval, to assume or reject executory contracts and unexpired leases. The trustee or debtor-in-possession must assume or reject an executory contract in its entirety, unless some portion of it is severable. The trustee or debtor-in-possession normally assumes a contract or lease if it is needed to operate the reorganized business or if it can be assigned or sold at
2940-596: Is offered to customers with benefits of up to 55% off. Take Off is the leader in Eastern Europe for B2B distribution of off-price clothing and accessories from top European brands. In Asia the off-price format is represented weakly due to widespread open marketplaces, factory stores that are able to offer their customers a range of quality goods at the lowest possible prices, and also groundbreaking online sales developments that offer various services. In certain countries new stores or road shows appear from time to time, and
3045-403: Is often highly contentious because it is both subjective and important to case outcomes. The methods of valuation used in bankruptcy have changed over time, generally tracking methods used in investment banking, Delaware corporate law, and corporate and academic finance, but with a significant time lag. Chapter 11 retains many of the features present in all, or most, bankruptcy proceedings in
3150-498: Is represented by goods from more democratic trademarks. Both networks offer clothing, footwear, every kind of accessories, home appliances. The company has more than 8 000 suppliers from various countries all over the world. Another off-price retailer giant in the US, Burlington, owns, as of 2018, more than 600 retail department stores. The retailer offers clothing, footwear, accessories, jewelry, personal hygiene products, toys, deco products with an off-price discount of 65%. Its revenue
3255-421: Is returned to the owners of the company. In Chapter 11, in most instances the debtor remains in control of its business operations as a debtor in possession , and is subject to the oversight and jurisdiction of the court. A Chapter 11 bankruptcy will result in one of three outcomes for the debtor: reorganization, conversion to Chapter 7 bankruptcy, or dismissal. In order for a Chapter 11 debtor to reorganize,
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3360-438: Is stayed, or put on hold, until it can be resolved in bankruptcy court, or resumed in its original venue. An example of proceedings that are not necessarily stayed automatically are family law proceedings against a spouse or parent. Further, creditors may file with the court seeking relief from the automatic stay. If the business is insolvent , its debts exceed its assets and the business is unable to pay debts as they come due,
3465-464: Is the airline industry in the United States; in 2006 over half the industry's seating capacity was on airlines that were in Chapter 11. These airlines were able to stop making debt payments, break their previously agreed upon labor union contracts, freeing up cash to expand routes or weather a price war against competitors — all with the bankruptcy court's approval. Studies on the impact of forestalling
3570-484: Is to grow out of Europe into a global leader of the segment. A large off-price network local to France is Stokomani . Stokomani operates 80 stores with an average area 2000 sq. meters. According to 2017 statistics, the company’s revenue was 440 mln euros. In France this segment is also occupied by Mistigriff, established in 1989 and including over 30 stores. The biggest off-price retailer in Europe nowadays, TK Maxx, part of
3675-639: Is up to 60-70%. The company also runs an online shop. In Canada the off-price segment is represented by networks mostly within the TJX Companies group: Winners, Marshalls and HomeSense. The biggest one is Winners , formerly the first countrywide retailer in this segment, operational since 1982. In 1990 the Company was taken over by TJX Companies corporation. As of 2018, Winners operates more than 260 stores and offers clothing, footwear, accessories, jewelry, cosmetics and home clothes. The network’s off-price falls within
3780-520: The Bealls , Palais Royal , Peebles , Stage, and Goody's nameplates before transitioning away from that business model and toward an off-price positioning in 2019 and 2020. On May 11, 2020, Stage Stores announced it had filed for Chapter 11 bankruptcy after failing to find a buyer for the chain. The company had suffered poor sales in the 2019 holiday season, and after the onset of the COVID-19 pandemic and
3885-502: The United States Trustee , can request the court convert the case into a liquidation under chapter 7, or appoint a trustee to manage the debtor's business. The court will grant a motion to convert to chapter 7 or appoint a trustee if either of these actions is in the best interest of all creditors. Sometimes a company will liquidate under chapter 11 (perhaps in a 363 sale), in which the pre-existing management may be able to help get
3990-447: The bankruptcy laws of the United States. Such reorganization, known as Chapter 11 bankruptcy , is available to every business , whether organized as a corporation , partnership or sole proprietorship , and to individuals, although it is most prominently used by corporate entities. In contrast, Chapter 7 governs the process of a liquidation bankruptcy, though liquidation may also occur under Chapter 11; while Chapter 13 provides
4095-521: The 20-60% bracket off regular prices, though it does not operate sales online. Marshalls in Canada operates 73 offline stores. A division of TJX Companies representing an off-price household goods’ network in the country operates under the brand HomeSense and has 117 stores as of early 2018. In Australia, the off-price segment is represented by TK Maxx stores. In 2015 TJX Companies acquired the local off-price network Trade Secret, which had operated since 1992 as
4200-455: The Bankruptcy Code requires the bankruptcy court reach certain conclusions prior to confirming or approving the plan and making it binding on all parties in the case, most notably that the plan complies with applicable law and was proposed in good faith. The court must also find that the reorganization plan is feasible in that, unless the plan provides otherwise, the plan is not likely to be followed by further reorganization or liquidation. In
4305-477: The Bankruptcy Code. Subchapter V, which took effect in February 2020, is reserved exclusively for the small business debtor with the purpose of expediting bankruptcy procedure and economically resolving small business bankruptcy cases. Subchapter V retains many of the advantages of a traditional Chapter 11 case without the unnecessary procedural burdens and costs. It seeks to increase the debtor's ability to negotiate
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4410-582: The Netherlands. In the CIS area (Commonwealth of Independent States) the off-price segment as of the year 2018 is dominated by mostly Russian and Ukrainian retail networks. Off-price as an independent format of making sales in Russia started its active development in the early 2000s through company Familia company. As of November 2018 it is the only federal off-price network countrywide. The company began activity in 2000 as
4515-834: The U.S. corporation of TJX Companies, showed up on the continent later than other French nationwide off-price networks: the first TK Maxx store was opened in Bristol, England, in 1994. As of 2018 the company owned over 540 department stores in Europe. Nearly 340 stores of those are located in Great Britain and 26 more in Ireland 120 in Germany 40 in Poland 10 in Austria and eight more in the Netherlands. The company also maintains its own online store in Great Britain. HomeSense, another TK Maxx brand, has also operated in
4620-695: The U.S.A. In Marshalls – there are over 1,000 stores. Both networks are managed by Marmaxx co., which is the biggest fashion operator in the U.S.A according to volume of sales. TJ Maxx and Marshalls (as well as other networks included in TJX Companies) offer discounts of 20-60% compared to regular retailers. Their suppliers are more than 20,000 companies from 100 countries worldwide. These networks have similar product assortments mainly based around clothing, footwear, accessories, similar stores in their area size and design, but in TJ Maxx one might find trademarks belonging to
4725-583: The UK since 2008. As of early 2018, the European subdivision of HomeSense totalled 53 stores in Great Britain and two more opened in 2017 in department stores in Ireland. TK Maxx and HomeSense had a cumulative revenue of 4bn euros according to 2017 statistics. Saks OFF 5TH also claims ambitions in Europe: the company opened its first continental stores in 2017, and as of November 2018 it has seven stores in Germany and two more in
4830-514: The US market – Nordstrom Rack , which opened in the basement area of the Nordstrom department store in downtown Seattle, WA. As the Nordstrom stores network grew, off-price Nordstrom Rack stores followed their success. In 1982 the Ross Stores network in the US, owner of 6 department stores, changed their format on passing to a new owner and began to grow as an off-price retailer. In just three years
4935-416: The US, is Sierra Trading Post . It specialises in online sales, trading via catalogues, and according to 2018 statistics it operates 30 retail stores to maintain public recognition. The company offers about 3 000 brands in total. It appeared on the market as a catalog seller in 1986, and in 2012 was purchased by TJX Companies for 200 mln dollars. The Company's website has existed since 1998. Already in 2004, it
5040-525: The United States. It provides additional tools for debtors as well. Most importantly, 11 U.S.C. § 1108 empowers the trustee to operate the debtor's business. In Chapter 11, unless a separate trustee is appointed for cause, the debtor, as debtor in possession, acts as trustee of the business. Chapter 11 affords the debtor in possession a number of mechanisms to restructure its business. A debtor in possession can acquire financing and loans on favorable terms by giving new lenders first priority on
5145-632: The area was given away to be subleased by third-party footwear, accessories and active sport product dealers, but that division wasn't visible to customers. The department store was at peak popularity, and in about 10 years, Marshalls became an off-price networking headliner in the United States with just two dozen stores. In the mid 1950s the countrywide famous network of Bell Hosiery Shops (a trader of knitwear that had reached nearly 60 department stores by 1946) began to experience success through its own “factory sales”, introduced due to wide expansion causing decline in their regular network sales. Consequently,
5250-515: The bankruptcy included most of the former Fashion Bar, Milliken's, Tri-North, and Uhlman's stores, as well as an exodus from Wisconsin, Michigan, and Minnesota. In 2003, Stage Stores acquired 136 Peebles stores located in 17 states. The company purchased the Goody's name through the Goody's bankruptcy auction in 2009. The nameplate was used in markets with a strong customer awareness and brand recognition of
5355-477: The bankruptcy restructuring may result in the company's owners being left with nothing; instead, the owners' rights and interests are ended and the company's creditors are left with ownership of the newly reorganized company. All creditors are entitled to be heard by the court. The court is ultimately responsible for determining whether the proposed plan of reorganization complies with bankruptcy laws. One controversy that has broken out in bankruptcy courts concerns
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#17328583994925460-399: The business's earnings. The court may also permit the debtor in possession to reject and cancel contracts. Debtors are also protected from other litigation against the business through the imposition of an automatic stay . While the automatic stay is in place, creditors are stayed from any collection attempts or activities against the debtor in possession, and most litigation against the debtor
5565-438: The chain during the COVID-19 pandemic . In 2015 the off-price segment was joined by Macy’s , a U.S. network of department stores, established in 1858. First of all, Macy’s launched five Macy’s Backstage stores, but a year later it changed its approach and began to allocate space to its new label in active Macy’s stores. In early 2018 the Company had 72 Macy’s Backstages and plans to open a new distributing center for maintaining
5670-423: The chances of a successful outcome and sufficient debtor-in-possession financing may be unavailable during an economic recession. A preplanned, pre-agreed approach between the debtor and its creditors (sometimes called a pre-packaged bankruptcy ) may facilitate the desired result. A company undergoing Chapter 11 reorganization is effectively operating under the "protection" of the court until it emerges. An example
5775-803: The closure of the other Fashion Bar Stores but retained the Stage name. The company purchased the forty-nine stores of Beall-Ladymon, Inc., sold by company president Horace Ladymon. The outlets were located in Arkansas, Kansas, Louisiana, and Mississippi; they were reopened in 1994 under the "Stage" name. Stage expanded into the Northwest with the acquisition in 1997 of C. R. Anthony Co. and Tri-North stores. The company acquired Uhlmans in 1996, which brought Stage to Michigan, Illinois, and Indiana. All of these newly acquired stores, however, were closed by 2001 when Stage Stores filed for Chapter 11 bankruptcy. Closures as part of
5880-479: The companies. In 1988 Zayre decided to concentrate its efforts on maintaining their off-price direction. It sold all of its network, consisting of nearly 400 Zayre stores, and the label itself to the competitive discounter network Ames Department Stores Inc. for 431.4 million, and by 1990 all Zayre stores were closed or converted into ones under the Ames brand. Meanwhile, in 1976 Marshalls was acquired by Melville Corp. By then
5985-400: The company, Remy Adrion, bought a huge supply of clothing directly from a factory on the brink of closure. This brought about the company “NOZ”; the first European off-price retailer. Gradually, Adrion widened the range of products on offer and increased the number of stores. By 1987 he had founded 10 stores in France with his own logistical platform. In 1992, state regulation changed to prohibit
6090-441: The concept of the format: customers searching for original branded products at their lowest ever price. This behavioral model is a symptom of a global trend of "smart shopping"; the customer's focus being on getting the largest financial benefits possible while buying high-quality products of the actual models. The origins of the off-price format are generally considered to be rooted in the U.S.A. The industry can be traced back to
6195-448: The confirmation hearing, a disclosure statement must be approved by the bankruptcy court. Once the disclosure statement is approved, the plan proponent will solicit votes from the classes of creditors. Solicitation is the process by which creditors vote on the proposed confirmation plan. This process can be complicated if creditors fail or refuse to vote. In which case, the plan proponent might tailor his or her efforts in obtaining votes, or
6300-407: The corporation in 2018 was valued at almost 39 billion dollars. From 2013-2017 inclusive, annual revenue of the company grew by an average of 2 billion dollars (building on 2013’s revenue of 26 billion dollars), and its number of hypermarkets grew by 27% (or 855 stores). The 2nd largest off-price store remains Ross Stores, a company which at the very beginning of 2019 possessed more than 1,700 stores,
6405-497: The creditors' rights to enforce their security reach different conclusions. Chapter 11 cases dropped by 60% from 1991 to 2003. One 2007 study found this was because businesses were turning to bankruptcy-like proceedings under state law, rather than the federal bankruptcy proceedings, including those under chapter 11. Insolvency proceedings under state law, the study stated, are currently faster, less expensive, and more private, with some states not even requiring court filings. However,
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#17328583994926510-538: The cumulative market segment is valued at 50 billion dollars, and it currently exceeds 80% of the world off-price market segment. Most of the stores belong to TJX Companies Corporation and form part of TJ Maxx, Marshalls and Home Goods. The second largest off-price operator in the U.S.A. is Ross Stores Company. This segment is also represented by the networks of Burlington , Nordstrom Rack , Tuesday Morning , Century 21 , Saks Off 5th and Macy’s Backstage. As of 2018 TJ Maxx unites over 1,200 stores in different states of
6615-444: The debtor does file a plan within the first 120 days, the exclusivity period is extended to 180 days after the order for relief for the debtor to seek acceptance of the plan by holders of claims and interests. If the judge approves the reorganization plan and the creditors all "agree", then the plan can be confirmed. §1129 of the Bankruptcy Code requires the bankruptcy court reach certain conclusions prior to "confirming" or "approving"
6720-403: The debtor must file (and the court must confirm) a plan of reorganization. In effect, the plan is a compromise between the major stakeholders in the case, including the debtor and its creditors. Most Chapter 11 cases aim to confirm a plan, but that may not always be possible. If the judge approves the reorganization plan and the creditors all agree, then the plan can be confirmed. Section 1129 of
6825-433: The debtor will be able to pay most administrative and priority claims (priority claims over unsecured claims ) on the effective date. Like other forms of bankruptcy, petitions filed under chapter 11 invoke the automatic stay of § 362. The automatic stay requires all creditors to cease collection attempts, and makes many post-petition debt collection efforts void or voidable. Under some circumstances, some creditors, or
6930-422: The debtor's property—will be paid before unsecured creditors. Unsecured creditors' claims are prioritized by § 507. For instance the claims of suppliers of products or employees of a company may be paid before other unsecured creditors are paid. Each priority level must be paid in full before the next lower priority level may receive payment. Section 1110 ( 11 U.S.C. § 1110 ) generally provides
7035-435: The decision to open 47 off-price stores branded as Red Rack in one fell swoop. The benefits for customers vary from 20-60%. Brands found in the network include Nike, Adidas, Puma, Superdry, Fenty by Rihanna, Ben Sherman, Billabong and Paul Frank. The company claims to stick to the principle of treasure hunting and it organises weekly replenishment of its product range. So far, the biggest off-price retailer with European roots
7140-578: The department store market and instead go all in as an off-price retailer. By the end of fiscal year 2020, Stage planned to operate approximately 700 Gordmans Stores. CEO Michael Grazer cited the high sales increases in locations that had already been converted as the main factor in this decision. After the COVID-19 pandemic caused most of its stores to temporarily close, Stage Stores announced that it would enter bankruptcy proceedings and liquidate its inventory, except for individual stores for which it could find
7245-537: The development of a consensual plan. It also eliminates automatic appointment of an official committee of unsecured creditors and abolishes quarterly fees usually paid to the U.S. Trustee throughout the case. Most notably, Subchapter V allows the small business owner to retain their equity in the business so long as the reorganization plan does not discriminate unfairly and is fair and equitable with respect to each class of claims or interests. The reorganization and court process may take an inordinate amount of time, limiting
7350-404: The ensuing retail shutdowns that began in March 2020, Stage Stores was unable to secure financing that would allow the continued operation of the chain. The company said that it would begin inventory liquidation sales at stores as soon as they could reopen. Exclusive brands of the company included Valerie Stevens, Signature Studio, Sun River, Rustic Blue, Rebecca Malone, and Wishful Park. Through
7455-410: The exigencies of the circumstances. Relief from the automatic stay is generally sought by motion and, if opposed, is treated as a contested matter under Bankruptcy Rule 9014. A party seeking relief from the automatic stay must also pay the filing fee required by 28 U.S.C.A. § 1930(b). In the new millennium, airlines have fallen under intense scrutiny for what many see as abusing Chapter 11 bankruptcy as
7560-433: The first 12 days. Although the idea of a "beneficial basement" wasn't new – since a similar concept had been used in 1879 by Marshall Field , – it was Filene's Basement which brought fame to it and promoted it as an innovative way to make sales. Filene's Basement eventually evolved into an off-price network of 20 hypermarkets that would exist until the year 2009. The schedule of automatic price reduction initially invented for
7665-547: The high sales increases in the locations that were converted in 2018 as the deciding factor in the decision. In September, 2019, Stage Stores announced that they planned to completely exit the department store market, moving completely to the off-price model, converting all other stores brands to the Gordmans brand, and operating approximately 700 Gordmans stores by the third quarter of fiscal 2020 (August-October). In May 2020, Stage Stores filed for Chapter 11 bankruptcy , even though
7770-478: The huge French off-price retailer NOZ. More than 250 stores belong to the Russian off-price network Familia. Cumulative off-price retail turnover in Europe, including the revenue from network online shops exceeds 5 billion euros. In Asia the off-price segment is still not that widely developed compared to Europe and America. In the US, where according to 2018 statistics there are more than 6,300 off-price retail stores,
7875-433: The lowest possible markup. As a rule, off-price retailers purchase huge supplies consisting of various products from their respective brand owners, with no strict requirements to the depth of their lineup (having all sizes available in stock) and collection completeness, which enables them to get more profitable terms for deals. Traditionally, shopping in off-price stores is referred to by the term "treasure hunt", reflecting
7980-455: The majority of which are in U.S.A. and Canada. Annual net sales of the company, according to 2018 results, reached almost 15 billion dollars (and since 2013 to 2018 it has grown by 38% ). In the United States and Canada there are more than 6,700 off-price format retail stores. In Europe, there are about 1,500 off-price retailer stores, most of them belonging to the 3 biggest networks: 540 to TK Maxx (inclusive in TJX Companies), and more than 300 to
8085-505: The name. In 2011, Stage Stores began a new chain called Steele's, but in March 2014 it was announced that these stores are being sold to Hilco Global . Stage Stores acquired the Gordmans ' assets in March 2017 after becoming the winning bidder in a bankruptcy sale. The company announced that it planned to run at least 50 stores and one of Gordmans’ distribution centers. Under the direction of Stage Stores, Gordmans began to transition away from
8190-408: The network expanded to 107 stores, and by the year 1996 it consisted of nearly 300 department stores with its annual revenue reaching 1,5 bln dollars. In Europe the off-price format appeared only a few decades after showing up in the United States. The first continental store of the kind appeared in 1976 under the “Le Soldeur” trademark, opening in the town of Laval, Western France. The then founder of
8295-507: The network had 36 stores in operation. With its new owner, growth surged : by the year 1995 it owned 496 stores in the US and Hawaii. In 1995 TJX Corporation bought out Marshalls – (now of Melville Corporation) by signing a bargain contract worth 606 mln dollars. In 1972 a company called Burlington was founded. The first store of the network appeared in Burlington, NJ, when the librarian Henrietta Millstein persuaded her husband to acquire
8400-465: The number of “Hit or Miss” stores in the United States had reached 420, and their sales had grown to 300 million dollars. Nearly 70% of its product assortment was brands with nationwide recognition, while the remaining 30% was manufactured under the Hit or Miss label. The network managed to keep price tags at 20-50% lower than most specialized stores ever did. In 1987 The TJX Companies, Inc. was founded to manage
8505-509: The off-price direction. Backstage offers mostly the same brands of clothing, footwear, accessories, beauty and wellness goods as offered at Macy’s. Discounts are up to 80%. One more relatively young off-price retailer in the U.S.A. is Saks OFF 5TH network, appearing in the market in 2016. Saks OFF 5TH network operates over 100 stores in the United States, and offers women's, men's and children's clothing and footwear, and also accessories and household products from over 800 premium brands. Off-price
8610-518: The ongoing conversions had resulted in same-store sales rising more than 17% in the November-January fiscal quarter. Stage Stores, Inc. has acquired many stores over the years, including the following: On September 17, 2019, Stage Stores announced plans to convert all remaining Stage, Bealls, Palais Royal, Peebles, and Goodys department store locations into Gordmans stores by the end of 2020. This would mean that Stage Stores would completely exit
8715-516: The opportunity to purchase goods through catalogues via the postal service. Zayre established the Chadwick's Boston co., and Home Club, Inc. networks of household appliance stores in 1985. So there the Corporation included a few networks, such as Zayre discounters for customers with low and medium level of income; TJ Maxx, Hit or Miss and Chadwick's Boston for clients with medium income and higher. By 1986
8820-516: The owners of Bell Hosiery Shops opted for discounting as their major sales strategy. They decided not to continue setting up discount stores at factories, instead choosing to begin opening new stores in malls or their own outlets. Their first hypermarket, boasting a total area of 5,000 square feet (460 m ), celebrated its opening in Hyannis, Massachusetts, in July 1956. It was named Zayre . A few months later
8925-405: The plan and making it binding on all parties in the case. Most importantly, the bankruptcy court must find the plan (a) complies with applicable law, and (b) has been proposed in good faith. Furthermore, the court must determine whether the plan is "feasible, " in other words, the court must safeguard that confirming the plan will not yield to liquidation down the road. The plan must ensure that
9030-412: The plan can be confirmed. If at least one class of creditors objects and votes against the plan, it may nonetheless be confirmed if the requirements of cramdown are met. In order to be confirmed over the creditors' objection, the plan must not discriminate against that class of creditors, and the plan must be found fair and equitable to that class. Upon confirmation, the plan becomes binding and identifies
9135-419: The plan is a compromise between the major stakeholders in the case, including, but not limited to the debtor and its creditors. Most chapter 11 cases aim to confirm a plan, but that may not always be possible. Section 1121(b) of the Bankruptcy Code provides for an exclusivity period in which only the debtor may file a plan of reorganization. This period lasts 120 days after the date of the order for relief, and if
9240-412: The plan itself. The plan may be modified before confirmation, so long as the modified plan meets all the requirements of Chapter 11. A chapter 11 case typically results in one of three outcomes: a reorganization; a conversion into chapter 7 liquidation, or it is dismissed. In order for a chapter 11 debtor to reorganize, they must file (and the court must confirm) a plan of reorganization. Simply put,
9345-442: The proper amount of disclosure that the court and other parties are entitled to receive from the members of the creditor's committees that play a large role in many proceedings. Chapter 11 usually results in reorganization of the debtor's business or personal assets and debts, but can also be used as a mechanism for liquidation. Debtors may "emerge" from a chapter 11 bankruptcy within a few months or within several years, depending on
9450-402: The size and complexity of the bankruptcy. The Bankruptcy Code accomplishes this objective through the use of a bankruptcy plan. The debtor in possession typically has the first opportunity to propose a plan during the period of exclusivity. This period allows the debtor 120 days from the date of filing for chapter 11 to propose a plan of reorganization before any other party in interest may propose
9555-554: The specialty department store business model, moving the brand to the off-price retail sector, more resembling stores like T.J. Maxx , Ross , and Burlington . As part of expanding the brand, Stage Stores opening their first new Gordmans store in Rosenberg, Texas in March, 2018. In March, 2019, Stage announced that by mid-2020 they planned to convert at least 220 of their current department stores, including those of other brand names, into Gordmans off-price stores. CEO Michael Glazer cited
9660-411: The store in the early 20th century was also used by him for quite a few decades after. By the middle of the 20th century the U.S.A. would witness the wide popularization of similar "basement sales" at other malls, as well as so-called “factory sales”, when vacant factory rooms were used for the discounted sale of over-produced goods. From 1930-1950 the textile and sewing industries in the U.S.A. underwent
9765-421: The store “Hit or Miss” was opened. It sold high-quality women's wear at discounted prices. Zayre Corp, aware of this new concept store and its rapid growth, took over Hit and Miss in 1969 with a view to maintaining their own fashion aspirations. Due to the volatility of U.S. Economy in the 1970s and the recession that had brought about significant change in customers' attitude to expenses, the off-price industry
9870-550: The term off-price is actively used along with the advantages of the format to customers. An annual Off-Price Show takes place in the Philippines, for example, which reminds of the U.S. “factory sales” that date back to the mid 20th century. Pop ups have also recently become popular. Mass expansion as in the US, or gradual systematic development as in Russia, has not yet begun. In China there is only one dominant off-price retailer – DX Quality Outlet, which manages pop-up stores along with
9975-473: The total shopping area occupied by fashion retail countrywide by 3.5%. The network stores represent products made by over 7 000 trademarks from 50 countries all over the world. In Ukraine the off-price segment is dominated by the company Red, which opened its first multibrand store in 2004. As of September 2018 the retailer has 10 stores located in Kyiv and Boryspil . Red also hosts a web store of their own. Off-price
10080-460: The treatment of debts and operations of the business for the duration of the plan. If a plan cannot be confirmed, the court may either convert the case to a liquidation under chapter 7, or, if in the best interests of the creditors and the estate, the case may be dismissed resulting in a return to the status quo before bankruptcy. If the case is dismissed, creditors will look to non-bankruptcy law in order to satisfy their claims. In order to proceed to
10185-416: The use of the term 'solde' in commercial organization names, and the network changed its trademark into NOZ . As of 2018 there are more than 8,000 retail off-price stores in operation worldwide, within the 20 largest off-price networks (their total number equivalent to dozens and even a few thousand stores). The global turnover of the segment as of the year 2017 is more than 60 billion dollars (approx. 2% of
10290-523: The whole fashion industry volume, including segments of luxury products, sport clothing and footwear as well ). The global leader of the sector is TJX Companies, as of 2019 owning more than 4,300 off-price hyper malls (the total area is more than 110 million square feet), split between its six retail networks (TJ Maxx, TK Maxx , Marshalls, Winners, HomeGoods, Homesense) in nine different countries (U.S.A., Canada, Australia, Great Britain, Ireland, Germany, Poland, Austria and The Netherlands). Annual net sales of
10395-417: The year 1909, when a special shopping area was opened in a ground-floor at a famous Boston department store, Filene's . It was called Filene's Basement and used for selling commodity surplus. Edward Filene, a son of the store’s founder, developed an "automatic price-reduction schedule" for it. The products were supplied to the basement with a discount tag, but in especially settled periods of time their price
10500-424: Was 6 billion dollars according 2017 results. The off-price network Nordstrom Rack, which sells mostly clothes, footwear, jewelry and cosmetics, operates 240 stores as of 2018. The retailer sells goods by the Nordstrom “mothership” network at a 50-60% discount, and also other brands’ clothes, footwear and accessories with a discount of up to 70%. The company notes that it supplies products to their off-price stores on
10605-542: Was awarded the prize of “No.1 Trademark in Russia” as an off-price network. In 2016, 2017 and 2018 RBC magazine included Familia in the annual list of “Top-50 Most Rapidly Growing Companies in Russia”, and in 2018 it was included in the list of “Top-500 Companies by Revenue in Russia”. As of April 2019 the Company manages more than 250 retail stores in 90 cities of the Russian Federation, their entire shopping area exceeding
10710-530: Was gaining considerable momentum. By buying surplus goods from manufacturers at the end of each season, off-price networks would offer fashionable branded goods at 20-60% lower than department stores. The “Hit or Miss” network belonging to Zayre Corp was growing so fast that Zayre considered the opportunity of expanding its off-price business. They even made a failed attempt to buy the Marshalls network that had also achieved fame as an off-price retailer. Zayre then hired
10815-567: Was included in the Top-400 retailers, and in 2005 – 2007, 2010, 2011 – in the Top-500. Ross Stores is the second off-price network in terms of size and revenue in both the U.S and the world. As of 2018 it owns over 1 600 stores, 1 400 of them operating under the brand Ross Dress for Less and a little more than 200 DD's Discounts. The latter network was founded in 2004 for consumers with a more moderate income than typical Ross Dress for Less customers, and it
10920-425: Was lowered even further: after 12 days the price would be lowered by 25%, in 18 days – by 50%, in 24 days – by 75%, and finally, after the 30th day, the goods would be given away at no charge at all to charity. The area itself was both well lit and properly designed, and it had hired its own separate floor staff. Filene's Basement was very popular among local residents and tourists, and most of its goods sold out within
11025-411: Was more than 22 billion dollars. One more related network in the U.S.A. is HomeGoods , which has existed since 1992 and specialises in selling products for the household: furniture, lighting, kitchen utilities, carpets and mats, textiles and deco products. As of 2018, there are more than 700 stores in different towns of the U.S.A. One more subdivision of TJX Companies that works in the off-price segment in
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