The filing, which came Friday, doesn’t include the contemporary wholesale business, which has sales of about $40 million and is run separately from the retail entity. Reached in Paris, founder and ceo Marc Bohbot said the wholesale operation, a $3 million creditor of the retail company, is “financially stable.”
Bohbot said a slowdown after Sept. 11 combined with heavy losses at poor-performing locations caused the bankruptcy.
Chief financial officer David Nisenbaum declined to specify retail losses, but said the company lost multiple millions on hyped new developments such as The Desert Passage in the Aladdin Hotel and Casino in Las Vegas and The Shops at Willow Bend in Plano, Texas. Bisou Bisou stopped costly construction on a store in Wellington Green, a new development in South Palm Beach, Fla.
The reorganization plan, yet to be completed, might call for as many as seven of the 15 remaining stores to shut, affecting 56 sales staff members, according to Nisenbaum.
At its height, Bisou Bisou had 21 stores. In an attempt to stave off bankruptcy, the company closed six stores in as many months and moved heavily discounted inventory at others.
As part of reorganization, Nisenbaum said the company plans to sell some of its 20 leases, several of which are unopened spaces in new developments.
“We were promised great locations, great co-tenancy and great advertising programs,” Nisenbaum said. “You end up two years later with a completely different scenario.”
Bohbot added, “The growing economy had pushed developers to build malls without a real analysis of competition from other malls. We were seeing some malls opening right next to each other. You cannot split customers like that.”
Key sites such as those in Southern California (the firm has doors in Beverly Hills, South Coast Plaza in Costa Mesa and in the Beverly Center here) and South Florida will remain open, Nisenbaum said.
“There will be no break in service in the remaining stores,” he added. “Holiday inventories will be liquidated through Feb 15.”