Barneys New York, the upscale department store chain, said Tuesday that it had filed for Chapter 11 bankruptcy protection after reports that it was seeking a lifeline as it grappled with high rents and tough competition. The retailer said it planned to close 15 physical stores. The remaining business will include five flagship department stores, including the one in Beverly Hills; two Warehouse stores; and its e-commerce shop.
Its financial woes are similarly symbolic because they demonstrate just how much the pressure to innovate in the luxury business has ramped up in recent years.Luxury apparel and accessory brands and stores weren’t exactly at the leading edge of e-commerce, with some in the industry believing that shoppers would never migrate en masse to the internet when looking for expensive pieces that were traditionally sold with high-touch customer service.
Richemont’s Net-a-Porter has established itself as a go-to digital destination. Matches Fashion, which is based in the U.K. but counts the United States as its largest market, is becoming a formidable e-commerce force with a particular emphasis on introducing customers to new, under-the-radar designers. That is something Barneys has also been known for over the years.
It’s clear that the value of big-city flagships is being reevaluated up and down the retail food chain. Lord & Taylor closed its storied Manhattan location, and Ralph Lauren Corp. and Abercrombie & Fitch Co. have also moved to give up New York flagships. These chains seem to be deciding that they don’t need flashy showpieces, just productive stores.
Barney's is gone? Darn.