Express Files for Bankruptcy as Consumers Shift Towards Casual Attire

Menswear Brand Express Faces Bankruptcy

Express, once a staple in malls across the country, filed for bankruptcy
Monday as consumers continue to shift away from formal and business
attire and lean into casual and comfort. The company, which includes
menswear brand Bonobos and clothing brand UpWest, said it will close 95
Express locations and all 10 UpWest stores. Closing sales will begin
Tuesday. The Chapter 11 filing will not affect the online or app shopping
experience.

Continued Operations During Bankruptcy Process

In a news release, the Columbus, Ohio-based retailer said it plans to
operate as usual while it begins the process for a court-supervised sale.
WHP Global, Simon Property Group, and Brookfield Properties intend to
purchase a majority of the company’s retail stores and operations.

Express CEO Affirms Commitment to Customers

“Express has a strong portfolio of brands and a premier omnichannel
platform,” said Express chief executive Stewart Glendinning. “Our top
priority remains providing our customers with the contemporary styles and
value they expect from us.”

Struggling Sales and Challenges

Express has seen lagging sales for years, struggling even before the
pandemic. In recent years, the company faced more challenges as consumers
shifted to remote or hybrid work and Americans leaned into a more casual
attire aesthetic. Express ran an operating loss of $28.7 million on
$454.1 million in net sales for the third quarter of 2023, the most
recent period for which it posted financial results.

Partnership and Turnaround Efforts

The store closures and bankruptcy filing are part of a broader plan to cut
costs, while executives said the partnership with WHP will put resources
behind a turnaround effort. “WHP has been a strong partner to the company
since 2023, and the proposed transaction will provide us additional
financial resources, better position the business for profitable growth
and maximize value for our stakeholders,” Glendinning said.

Outdated Merchandising Strategy

Express has seen its sales crater even though the broader apparel sector
is strong. Part of the problem has been that the company’s more formal
offerings suffered as work-from-home trends contributed to a broader
“casualization” of fashion, GlobalData managing director Neil Saunders
said in a note. “This puts Express firmly on the wrong side of trends,
and, in our view, the chain made too little effort to adapt,” Saunders
said. He added that the company’s retail assortment is generally
overpriced, lacks differentiation and “comes across as very bland,” making
it less relevant to the consumer of 2024.