David’s Bridal, the largest wedding gown retailer in North America, filed for bankruptcy protection on Monday, seeking to find a buyer for its business.
David’s Bridal said in a statement that it would “fulfill all customer orders without disruption or delay,” but might be forced to wind down operations if it cannot find a buyer. The company, which previously went bankrupt in 2018, said its business has suffered in recent years due to the COVID-19 pandemic, decreased demand for wedding dresses and high inflation.
“We are determined to stay focused on our future, because we believe we have an important role in ensuring that every bride, no matter her budget, can have her perfect dress,” CEO James Marcum said in a statement.
Pennsylvania-based David’s Bridal has 294 stores and 10,000 employees, offering bridal gowns for as low as $199, according to court documents filed in New Jersey bankruptcy court.
U.S. Bankruptcy Judge Christine Gravelle in Trenton, New Jersey, on Monday allowed the company to borrow up to $10 million, which will be used to pay critical vendors, employee severance and other near-term costs. The company will seek permission to borrow an additional $75 million later in its bankruptcy case.
David’s Bridal entered bankruptcy with just $4.4 million in cash on hand, and it owes more than that to a single critical vendor that is making 30,000 dresses for the company, Marcum said in court.
The privately owned company on Friday sent notices under the WARN Act, a federal law that requires businesses with 100 or more employees to provide 60 days’ notice before engaging in mass layoffs, saying it intended to lay off more than 9,000 employees by August.
About 25% of brides in the U.S. wear David’s Bridal gowns at their weddings, and David’s Bridal has dressed 70 million brides over its 70-year-old history, according to the company’s court filings.
The company has $256.9 million in debt, and it has engaged a consultant to coordinate store closing sales if necessary.
The company’s previous bankruptcy allowed it to cut $434 million in debt, but the pandemic and temporary bans on in-person events began to hurt the company nearly as soon as it emerged from Chapter 11, according to court documents.
There were about 1.7 million marriages in the U.S. in 2020, the lowest level in 121 years and longer-term declines in marriage rates meant that weddings have been slow to rebound, according to the company.