Claire’s, the accessories chain, faces bankruptcy. It operates over 1,200 standalone locations in North America and 850 overseas. The company is considering either finding a buyer or closing all stores through a liquidation process. A Chapter 11 case was filed in Delaware, with Canadian affiliates planning similar proceedings.

If a buyer is not found, 700 mall locations are set to close by September, with all Claire’s stores expected to shut down by October. Assets from U.S. operations may be sold in a bankruptcy auction, potentially reviving the brand online. The closure of unprofitable stores is part of a smaller footprint strategy.

Claire’s sources merchandise from 250 vendors, with a majority located outside the U.S. The company has faced challenges due to reciprocal tariffs and price increases. The Chapter 11 petition lists total assets and liabilities between $1 billion to $10 billion. The company’s core target market is girls aged 3 to 18.

Claire’s faces competition from online retailers like Shein and Temu, along with financial challenges. Late payments and cash-flow strain have led to aging invoices. The company’s outstanding bills 91+ days past due have increased significantly. The bankruptcy filing is the second for Claire’s, owned by Elliott Management Corp. and Monarch Alternative Capital.

The company’s closure of unprofitable stores is part of a go-forward business plan. Claire’s has engaged in talks with potential buyers and is considering a stalking-horse bid. The company’s heavy reliance on foreign suppliers has impacted its operations, especially following tariffs implemented in April.

Read more at Yahoo Finance: Claire’s Chapter 11 Bankruptcy is Following a Dual Track Process, Could Close At Least 700 Stores