Ascena Retail Group Inc. plans to wind down Dressbarn, and will close around 650 of the women’s budget clothing stores in the United States as it looks to focus on more profitable brands, it announced on May 20.
The company, which houses other women’s apparel brands including Lou & Grey, Ann Taylor, and Loft, said it will eventually shut down all of its almost 650 Dressbarn stores across the United States, but added that they remain open for the time being.
Gary Muto, CEO of Dressbarn’s parent company Ascena Retail Group, said in a statement cited by CNN, “It has been our pleasure to serve you, making it all the more difficult to let you know that the decision has been made to begin winding down the Dressbarn business.”
— NJ.com (@njdotcom) May 21, 2019
The closure of Dressbarn, which opened its first store in in Stamford, Connecticut, in 1962, comes as data compiled by Bloomberg found Ascena has made more than $1 billion losses in the past four years.
Bloomberg found in March that the women’s retailer was operating under around $1.6 billion in debt.
Steven Taylor, Dressbarn chief financial officer said in a statement, “This decision was difficult, but necessary, as the Dressbarn chain has not been operating at an acceptable level of profitability in today’s retail environment.”
— ROGUELINE (@ROGUEline) May 21, 2019
Ascena officials assured customers that for now they will be able to continue to make online orders from the dressbarn.com website and use the store’s credit card, the Wall Street Journal reported.
In a note to customers, Dressbarn added that there will be no changes to its refund or gift-card policies or loyalty rewards programs.
“During the wind-down process, we will continue to provide our customers with the same great experience both in-store and online, offering them even better deals and value,” Taylor said.
“We will work to assist our associates through the transition and maintain existing relationships with our vendors, suppliers, and other key stakeholders through this process.”
More retail closures have been announced this year already than there were in all of 2018 https://t.co/JnnM9dabgz
— David Dayen (@ddayen) May 21, 2019
Neil Saunders, managing director of GlobalData Retail, told CNN that the closure of Dressbarn is not surprising given its accelerating losses over the fast few years.
“While the closure of Dressbarn was not inevitable, given the company’s dire performance it comes as little surprise that Ascena has decided to head for the exit,” he said.
“Over the past few years, Dressbarn has lost customers, sales and share; it has also been unprofitable. Over recent quarters, those losses have accelerated and have shown no signs of reversing.”
— idivafashion (@idivafashion) May 21, 2019
Dressbarn, a household name for over 50 years, has struggled to grow sales in a competitive market where it battles with online retailers like Amazon.com Inc and off-price retailers like TJX Cos Inc.
The news will serve as a hard-hitting blow for U.S. retailers, as reports show 5,994 stores are set to close across the country this year, according to CNN, citing a recent report from Coresight Research. The figure tops last year’s total number of closure announcements, 5,864, the report found.
According to the report, this year Shopko, Payless, Gymboree, and Charlotte Russe have all filed for bankruptcy and will close a total of 3,720 stores.
— ABC 7 Chicago (@ABC7Chicago) May 21, 2019
Reuters contributed to this report.