Barney''s Uses Live Models For Display

Source: Chris Hondros / Getty

Barneys New York, one of the most iconic retail stores in America has filed for bankruptcy on Tuesday morning, and according to CNBC they’re desperately searching for a buyer to avoid liquidation.

The retailer is currently planning to downsize and only operate five of their stores, New York’s Madison Avenue, in downtown Manhattan, Beverly Hills, San Francisco and Copley Place. They’re also currently planning to keep open two of their warehouses, Barneys Warehouse stores in Woodbury Common and Livermore.

Stores in Chicago, Las Vegas and Seattle, as well as five smaller concept stores and seven Barnes Warehouse stores are all planning to be closed.

As e-commerce becomes so much more prevalent this just makes the luxury retailer another in the long list of stores that have been filing for bankruptcy. Overall, this increased the competition they must compete with, couple that with rising rent prices, and sales dropping, you get a company that’s really short on cash.

With the lack of cash, they’re even having trouble acquiring the latest trends from vendors, and are instead a season behind, overall, it’s like being stuck between a rock, and a hard place for Barney’s.

“Like many in our industry, Barneys New York’s financial position has been dramatically impacted by the challenging retail environment and rent structures that are excessively high relative to market demand,” Barneys CEO Daniella Vitale said in a statement.

The bankruptcy filing will allow the company “to conduct a sale process, review our current leases and optimize our operations,” she added.

Part of the issue for Barney’s could be in the way they pay their employees. They are one of the few retail stores that has 90% of its’ employees are full-time, and they’re also covered by a union. That can be very expensive.

As e-commerce continues to grow, traditional retail stores continue to face uphill battles to keep the doors open.