The pandemic has picked off small businesses one by one, from the moment we all retreated indoors for the foreseeable future. Now it has made its first big hit, with major US retailer J.Crew filing for bankruptcy on Monday.
The preppy brand has been on a rough ride for a while now, but the current crisis may have been the final straw. In recent years they fell short of impressing the demanding millennial market, who weren’t convinced by their typical sailor chic style. Especially as cheaper, on-trend retailers stormed into view, with the likes of Zara providing similar looks at a faster and more affordable rate.
This hasn’t always been the case though. It’s bourgeois prep defined the inspirational lifestyle for many of the mid-to-upper class in the 90’s. Their catalogues and advertisements featured good-looking families smiling breezily while sailing into the sun on admirable yachts. Clean cut men and graceful women looked buoyant, casually sporting the newest chunky J.Crew knits and flashy white chinos.
Since their boating days, the brand has seen itself navigating a tough downhill battle. Their ability to keep their head above water for so long can be credited to past President and Creative Director, Jenny Lyons. Her designs and promotional strategies kept the brand in the public eye. Famous fans have included none other than Meghan Markle and the former First Lady, Michelle Obama. However, Lyons resignation in 2017 sparked a range of organisational restructurings that put a big question mark over the retailers lifespan.
The deciding factor may have been the inability to optimise their place in the online sphere. With nearly 500 J. Crew stores being forced to close on an international level, the pandemic has certainly highlighted the importance of digital identity and online connection. Still, this may not mark the end for J.Crew. Their 9 years of mounting debt, adding up to around $1.6bn, has been cancelled and the responsibility of the brand now falls into the hands of its lenders.
The injection of $400m will be used to keep the company afloat, as they begin to plan a company-wide reevaluation. In a statement, J.Crew’s Chief Executive Officer, Jan Singer said, “This agreement with our lenders represents a critical milestone in the ongoing process to transform our business with the goal of driving long-term, sustainable growth for J.Crew.” The strategy involves a much needed rejuvenation of their e-commerce and some substantial repositioning.
The team hopes this quick turnaround won’t be too little too late, considering that current demand is in short supply.
Despite the uncertainty, the company is sharing a seemingly optimistic view in airy social media posts that look toward the future. They have guaranteed that the show will still go on, continuing to be fully operational, while following CDC guidelines and working towards eventual store re-openings. J.Crew is the first big retailer to show the effect the pandemic has had on the fashion industry – and they certainly won’t be the last.
It has been reported that similar heritage retailers, Neiman Marcus and JCPenney are looking into filing for bankruptcy and it would be no surprise if many others quickly follow. With clothing sales evidently plunging downwards everyday, only time will tell if the fashion industry can make a speedy recovery.
By Rachel Douglass