Connect with us

Hi, what are you looking for?

The American GeniusThe American Genius

Business News

There’s not enough mall walkers to keep Perfumania from downsizing

(BUSINESS NEWS) Perfumania has filed for chapter 11 bankruptcy creating pandemonium for all of the good smelling people of earth.

perfumania

FALLING ON (ED)HARD(Y) TIMES

Last Saturday Perfumania Holdings filed for Chapter 11 bankruptcy, announcing it will close 64 of its 226 stores. Although Perfumania already closed 103 stores in the past three years, the company was still losing money. CEO Michael Katz cited the declining popularity of brick-and-mortar stores, but he has plans to restructure.

bar
As part of the reorganization, the company is going private. Katz hopes to put more emphasis on online shopping, renegotiate leases, and focus on high performing stores. In a prepared statement, he said there will be no changes in licensing agreements, employees “will continue to receive their salaries and benefits,” and “retail customers will not see any interruption in the flow of merchandise.”

BURBERRY MY HEART

My first real job was at a perfume store in an outlet mall. Fun fact: if you work the Black Friday 2AM shift, your lips will get chapped from spraying so many samples. Our rival Perfumania was situated in the desirable area in front of the food court. We were tucked between a tween jewelry outlet and cookie store people avoided because it was dangerously good.

Despite the number of people that came in asking for the most expensive perfume— even though it smelled like cotton candy body spray—it was hard to make the sales goals each month.

And I just worked for a relatively unknown, not very creatively named chain.

Although Perfumania definitely got more foot traffic, consumer patterns have changed to favor ecommerce over malls.

Advertisement. Scroll to continue reading.

VIVA LA JUICY DETAILS

In 1980, Perfumania came into existence. Since then, in purchased Model Reorg Inc. in 2008, and outstanding common stock of Paralux in 2012. As its empire grew, the company gained exclusive rights to Trump-branded fragrances, as well as a slew of other celebrities like Rihanna and Jay Z.

Now Perfumania is once again getting a loan from Wells Fargo…to pay off their other loan from Wells Fargo. The $83.75 million bankruptcy loan will be used to repay the $18.78 million pre-bankruptcy loan.

Unsecured creditors will be reinstated or paid in cash.

The company stresses wholesale brand Paralux, who owns the rights to Trump’s fragrances, and Five Star Fragrance are not included in the Chapter 11 filings.

ETERNITY ISN’T FOREVER

While many companies filing for Chapter 11 have outright closed, I applaud Perfumania for hanging in there. Maybe they’ll make a miraculous turnaround and dominate the ecommerce fragrance market.

If not, I will leave you with this wisdom: perfume and cologne can last up to seven years if kept in a cool, dry place. So stockpile your favorite wholesale fragrances and hold tight just in case Perfumania goes under.

Advertisement. Scroll to continue reading.

#Perfumania

Written By

Lindsay is an editor for The American Genius with a Communication Studies degree and English minor from Southwestern University. Lindsay is interested in social interactions across and through various media, particularly television, and will gladly hyper-analyze cartoons and comics with anyone, cats included.

Click to comment

Leave a Reply

Your email address will not be published. Required fields are marked *

Advertisement

The
American Genius
news neatly in your inbox

Subscribe to our mailing list for news sent straight to your email inbox.

Advertisement

KEEP READING!

Business News

(BUSINESS NEWS) A list of companies that have filed bankruptcy have either been reorganized or straight up closed.

Business Finance

(FINANCE NEWS) With the way the world works now, bankruptcy doesn't necessarily mean game over.

Business News

(BUSINESS NEWS) Recently Toys R Us announced bankruptcy but now the toy retailer is seeing the immediate repercussions of being financially unstable.

Business News

(BUSINESS NEWS) Toys R Us is about to be added to the ever-growing list of brick and mortar store that couldn't hang with online...

The American Genius is a strong news voice in the entrepreneur and tech world, offering meaningful, concise insight into emerging technologies, the digital economy, best practices, and a shifting business culture. We refuse to publish fluff, and our readers rely on us for inspiring action. Copyright © 2005-2022, The American Genius, LLC.