Fashion house BCBG may file for bankruptcy. It will close most of its approximately 200 US stores. Bankruptcy would have the advantage of shielding it from legal action by landlords, who have been put under pressure by a wave of retail bankruptcies and shuttered stores.
BCBG is from the French phrase bon chic, bon genre. It was founded in 1989 and grew through its retail shops and distribution in department stores including Saks Fifth Avenue and Bloomingdale's. It also acquired Herve Leger, maker of skin-tight dresses, and started a lower-cost line called BCB Generation.
The company’s retail store business declined by 20 per cent over the past three years. It reported consolidated net sales of just over 600 million dollars in the 12 months to December. Retail accounted for 71 per cent of its revenue, while wholesale accounted for 18 per cent. The percentage share for licensing and e-commerce sales were in single digits.
BCBG’s form-fitting party dresses have been worn by the likes of Selena Gomez, Drew Barrymore and others. Competing specialty retailers, including The Limited and American Apparel, have also filed for bankruptcy in recent months and are closing down stores. The US retail sector is struggling as shoppers are abandoning malls in favor of internet shopping.