Retail turnarounds will continue throughout 2016, and it’s likely we will see more brands wind up in Chapter 11, as shifts in consumer shopping habits, coupled with the rise of e-commerce and fast-fashion, render many retailers overstored and financially unstable.
“The American household is still in the process of tightening its belt, the cross-currents of Internet competition are formidable, and we haven’t yet begun to see all of the consequences,” says James Tancredi, a partner at Day Pitney LLP. “We’re in a period of great transition,” says Tancredi. “It’s not distress. It’s transition.” But that ride is likely to end in a darker place, where some retailers don’t survive.