NEW YORK — Citing a lack of funding and the “general economic decline” in the Southeast, Kenwin Shops Inc., a 146-unit women’s apparel chain, filed a Chapter 11 petition here seeking time to cut costs and streamline operations.
The Tucker, Ga.-based retailer said its funding shortfall was a result of its secured lender and apparel factors tightening the purse strings.
Kenwin lost $450,608 in the second quarter ended July 3 against a profit of $140,332 in the same period last year. Sales dipped 20.5 percent in the quarter to $9.9 million from $12.5 million.
Ronald S. Itzler, of Fishbein, Badillo, Wagner & Itzler, counsel to Kenwin, explained that Kenwin will close 44 units by the end of October, leaving the chain with about 100 stores.
The remaining stores, Kenwin said in court papers, will be stocked with “adequate and timely” merchandise for the holiday season. In addition, the firm said it wants to refurbish many of its stores and start a new advertising campaign and direct marketing program.
Kenwin, Itzler said, has inked a $2.75 million debtor-in-possession financing deal with Sterling National Bank.
At the time of the filing, Kenwin, which does business as Suzanne Shops, Dress for Less and Dixie Shops, had liabilities of $4.8 million, all but about $600,000 unsecured. Assets totaled $10 million.
Kenwin’s largest trade creditors are Glenfrey Fashions Inc., $352,404; Reina Industries Ltd., $326,030; Leni-Leni Ltd., $224,792; Rising Star, $176,842, and Ambassador Factors, $173,740.
— Fairchild News Service