A large home improvement retailer is contemplating bankruptcy as a result of falling sales as consumers cut back in response to increasing inflation.
The Texas-based furniture and appliance retailer Conn’s Inc. is taking bankruptcy filings seriously and may have to shut down soon.
Bloomberg reports that the company is consulting with financial and operational advisors in preparation for a possible Chapter 11 bankruptcy reorganization.
Retailer finds itself in this predicament due to inflation and stagnant sales.
Bloomberg fails to cite its sources but claims to have spoken with persons who are aware of the plans.
There is still time for negotiations to conclude and for plans to evolve, according to Bloomberg.
Signs outside the Baton Rouge, Louisiana, business suggest that it may be closing shortly, according to The-Sun.
It has been reported that other stores around the nation are also planning to close their doors.
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It was requested that Conn’s provide a comment regarding the matter, but they chose not to cooperate.
In December 2023, Conn’s attempted to boost its sales by purchasing W.S. Badcock, another furniture company. However, since then, the retailer has faced difficulties in integrating the three businesses.
Even after acquiring W.S. Badcock, a competitor in the home goods industry, Conn has not seen a significant increase in sales.
For three consecutive fiscal years, Conn’s has been unable to break even. This year, its shares have dropped by 77%, according to Bloomberg.
Additionally, shares have fallen another 18% in the past 3 days.
The shop put off submitting its quarterly financial reports until last month so it could try to get a better deal on debt.
In addition to delaying this disclosure, Conn’s also announced borrowing $25 million as part of a credit deal on the same day.
Conn’s has over 500 locations spread out throughout fifteen states. As a plumbing and heating company, the store was formed 134 years ago, in 1890.
Additionally, in 1934, the company was acquired by Conn. Reports about the store’s bankruptcy filing should be considered preliminary at this time.
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