You may have just sat on your last massage chair at Brookstone.
Retail chain and shopping mall staple Brookstone has filed for Chapter 11 bankruptcy. As a result, after over 40 years of business, the company announced it would be closing all 101 of its shopping mall locations. Its e-commerce store, as well as its 35 airport based retail locations, will remain open for business.
Today, we announced we’re closing our mall stores in the coming weeks. However, our website and airport stores are open for business! We will continue to provide you with the products you love. Thank you for your loyalty over the years.
— Brookstone (@Brookstone) August 2, 2018
This marks the second time the company has filed for bankruptcy. Brookstone filed for bankruptcy protection in 2014 and later sold to Chinese conglomerate Sanpower Group. At the time, Brookstone had more than 200 retail locations.
Brookstone gained its customer base as the quirky home retail and electronics chain that allowed store visitors to test out and try its products. Known for selling everything from drones and smartphone accessories to massage chairs and blankets, Brookstone was heavily dependent on foot traffic for its mall store locations, according to its CFO Greg Tribou. The undeniable decline of the American mall, which can be seen in other former predominant mall locations like Claire’s and Toys ’R’ Us which both filed for bankruptcy this year, attributed to the company’s demise.
In Brookstone’s Chapter 11 filing document, Tribou writes:
“mall stores have operated at a loss each year consecutively since 2014 as a result of shift of consumer preferences away from brick and mortar retailers (and shopping malls in particular) and the attendant loss of foot traffic that is so critical to the successful operation of retail stores.”
In contrast with Brookstone’s mall store locations, Tribou further explains in the document why its airport stores remain open:
“Unlike the mall stores, consistent foot traffic, a captive consumer audience and limited seasonality has allowed these stores to thrive (on an aggregate level) in comparison to the Debtors’ mall stores.”
Brookstone employees took to Twitter to voice their dismay. It seems some employees only found out about their workplace soon closing when the rest of the world found out.
Nice job letting employees know on social media instead of in person
— Jessiah Ramon (@SUAVAGEMENTE) August 2, 2018
Now facing just over $129.5 million debt and a future that has seen to become the norm for many legacy brick-and-mortar retail businesses, Brookstone looks to close its mall store locations and sell off its remaining assets.
UPDATE: Aug. 3, 2018, 2:03 p.m. EDT This post has been updated to reflect Brookstone’s debt as published in its filing.