Yesterday was a bad day to be a retailer with both Bennigan's restaurants and Mervyn's clothing stores filing for bankruptcy protection.
In the case of Bennigan's, the chain filed for Chapter 7 bankruptcy. Managers received notice on Monday night not to reopen their doors on Tuesday as the company was unable to continue to pay its staff and its obligations. The filing affects Steak and Ale restaurants as well. Under this bankruptcy type (Chapter 7), the chain will seek to liquidate its assets and shut down.
Mervyn's filed for Chapter 11 bankruptcy protection. Under this plan, the company will reorganize and attempt to restructure its debts. Throughout the process, Mervyn's will remain open - we won't bore you with the practical nuances of a debtor versus a debtor-in-possession (lucky you). Last year, Mervyn's reported a loss of $64 million. Ouch.
What a shame, growing up, Bennigan's was one of our staple restaurants - we went there after our high school dances and on dinner dates after work when the world was simpler, gas was .99 a gallon and we were still basically playing at being adults.
We will miss their baked potato soup.
With so many choices and our dollars not going as far as they used to, consumers are getting pickier and pickier about what they spend their bucks on. Whether it's dinner or clothing, we're simply not settling because we have to make it stretch. And with so many choices out there, businesses really have to do a better job of product differentiation.
Hard times for not only consumers, but businesses as well. This is probably the beginning of the bankruptcy filings.
--Contributed by Deb
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