Reitmans closing Thyme Maternity, Addition Elle brands during restructuring
Posted June 1, 2020 9:04 am.
This article is more than 5 years old.
MONTREAL — Reitmans Canada says the insolvent clothing retailer will close its Thyme Maternity and Addition Elle stores over the summer, affecting about 1,400 employees, as part of its corporate restructuring.
The Montreal-based company says it will focus on three brands: Reitmans, Penningtons and RW & CO.
The brands will combine an e-commerce focus and a retail network of stores as part of the company’s efforts to “optimize its retail footprint.”
The restructuring is taking place under the protection of the Companies’ Creditors Arrangement Act.
Reitmans operates 54 Thyme Maternity stores and 77 Addition Elle locations, which will close along with their e-commerce websites on July 18 and Aug. 15 respectively.
About 1,100 store employees and 300 head office employees will be affected by the brand closures.
“All of the efforts we put forth to turn these brands around were derailed by the COVID-19 pandemic and, unfortunately, we can no longer afford the required resources to bring them back to profitability,” CEO Stephen Reitman says in a news release.
The company will liquidate the brands’ merchandise and wind down their websites when the stores will close.
As part of the closures, about 1,100 retail and 300 Montreal head office workers will lose their jobs.
Reitman, who assumed the CEO role in early 2020 following the death of his brother Jeremy Reitman, said he was “heartbroken to have to say goodbye” and grateful for the departing workers’ contributions.
The closures follow a move last month by Reitmans to seek court protection from creditors under the Companies’ Creditors Arrangement Act and restructure the company.
As part of that plan, the retailer will focus on its three remaining brands _ Reitmans, Penningtons and RW & CO.
The company employs about 6,800 people and operates 259 Reitmans, 106 Penningtons and 80 RW & CO. locations.
Bruce Winder, an independent retail analyst, said he thinks the move will keep Reitmans alive for about a year, but said the outlook doesn’t seem promising.
“What this will help them do is generate a little bit of cash this summer because when you liquidate stores, you get cash and that is one of the upsides of dumping brands,” he said.
However, that won’t erase temporary store closures necessitated by the pandemic, changes in consumer buying habits or even the demographic Reitmans has managed to attract.
“I see Reitmans as more of a baby boomer brand,” he said. “Millennials are more of the sweet spot for most brands in terms of their biggest demographic to target. I can’t really see millennials, at least on the Reitmans brand being overly excited.”
The pandemic has hastened some of Reitmans struggles and more of the industry consolidation the retail sector has experienced over the last decade, Winter said.
“Unfortunately they’re not one of the ones and when the music stops, I don’t think there’s a chair for them.”
