Off-price home good and décor retailer Tuesday Morning announced it’s filing for Chapter 11 bankruptcy protection. The company is “pursuing a financial and operational reorganization to enable it to reduce its outstanding liabilities, obtain significant and necessary capital, and ultimately transform into a nimbler retailer that serves heritage markets in a profitable manner,” according to a press release. Tuesday Morning has secured a $51.5 million debtor-in-possession commitment from Invictus Global Management that will support the company’s operation while the case is pending.
As part of the restructuring process, Tuesday Morning plans to reduce its store footprint to focus on its “core and heritage markets.” It currently operates 487 stores in 40 states. Tuesday Morning also “expects to pivot to a third-party logistics model and transition to a more cost-effective inventory acquisition strategy for remaining stores.”
Total Retail’s Take: In September, Tuesday Morning secured $32 million in debt financing from a special purpose vehicle formed by Retail Ecommerce Ventures — the owner of Pier 1 Imports, Linens ‘n Things, Stein Mart, Modell’s Sporting Goods — and Ayon Capital LLC. The retailer previously filed for Chapter 11 in May 2020 with similar plans to become a leaner company, shuttering 230 of its then nearly 700 stores.
Tuesday Morning has been struggling since the onset of the COVID pandemic, like many other legacy brick-and-mortar retailers. Previous cash injections haven’t produced strong results. The company also recently shook up its leadership and in December voluntarily delisted itself from the Nasdaq as it plans to go private. Hopefully, Tuesday Morning can make good use of its second bankruptcy in three years to reorganize the business, cut costs, and grow revenues, allowing it to continue operations well into the future.
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