In 2019, Barneys New York faced a familiar set of problems for department stores. It had been hit by price wars, e-commerce penetration, declining customer traffic and sales, and increasing rents. Many of its stores were unprofitable, and others were falling short of projections.
By June, revenue was down $34 million year over year, the retailer’s restructuring officer said later in court papers. In response to the sales skid, the lenders behind Barneys’ asset-based credit facility reduced the amount the retailer could borrow by $5 million. The move was meant to protect the lenders from losses. It also suddenly downsized Barneys’ operating funds.. . . more