Company admits to growing too fast, cannibalizing business.
This past Friday, Oct. 5, 2018, the country’s largest mattress retailer Mattress Firm Inc. filed for bankruptcy. The company says it opened too many stores that were too close to one another, essentially “cannibalizing” its brick-and-mortar business.
The retailer filed for Chapter 11 bankruptcy protection in Delaware federal court. In the documents, it said it plans to close 700 of its more than 3200 stores, the Associated Press reports. The company employs 9800 people, though it is not clear at this time how many of those employees will be affected by the closures.
The retailer has bought up stores from its competitors and rebranded them in the past several years, though the company now says many of those decisions were made after “miscalculations” from its previous management team.
In court documents, the company disclosed that it has more than $1 billion in liabilities and has more than 50,000 creditors, according to the Herald-Dispatch. It projects it will lose about $150 million in the 2018 fiscal year.
This article was originally published in our sister publication, VMSD.