Troubled clothing retailer Filene's Basement Corp. will close all of its Washington area stores by the end of the year as it pins its hopes on its remaining locations in urban centers, where sales are stronger, the company said.
The Wellesley, Mass.-based discount chain, which filed for Chapter 11 bankruptcy protection from its creditors Aug. 23, is shutting 18 of its stores, including the downtown Washington store as well as its Rockville, Mazza Gallerie, Baileys Crossroads and Shops at National Place locations.
The company said it expects to lay off about 900 employees, or 30 percent of its total work force, but said it couldn't estimate the number of Washington area employees affected by the closings.
Filene's will keep 14 of its Filene's Basement stores and all eight of its Aisle 3 discount warehouse stores open in major urban areas in New York, Illinois and Massachusetts.
"Our plan will allow us, when we emerge from bankruptcy, to be a smaller yet stronger organization, said Sam Gerson, chairman and chief executive of the 91-year-old retailer.
"I think Filene's has been the outstanding example of a poorly run company," said Kurt Barnard, whose Montclair, N.J., company publishes Barnard's Retail Trend Report. Filene's sales have suffered because of "poor merchandise selection, poor pricing and poor presentation," Barnard said. "Filene's . . . simply never got out of the basement."
Last year, Filene's posted a net loss of $9.5 million on revenue of $588.5 million.