Bankrupt Brands Are Good News for Kohl's
(Bloomberg) -- Bon-Ton Stores Inc.’s liquidation has rival Kohl’s Corp. reaping the rewards.
Kohl’s, which reported same-store sales Tuesday that outpaced projections, has been spending to capture former customers of the bankrupt department-store chain, according to chief financial officer Bruce Besanko.
“The Bon-Ton chain is actually liquidating versus just having closed stores, and so customers will not have the opportunity to go to a different store that might be nearby,” Besanko said on the Kohl’s earnings call. “We’re going to again put marketing dollars strategically against those store closures, so we think that should be a nice benefit in the second half.”
Bon-Ton filed for bankruptcy protection from creditors in February as the more than century-old retailer became the latest victim of slumping mall traffic and the rise of online shopping.
That’s not the only recent bankruptcy lending Kohl’s a tailwind. The retailer also announced Tuesday a partnership with the new owner of Nine West, Authentic Brands Group. Starting next summer, Kohl’s will sell Nine West shoes, handbags and an exclusive women’s clothing line in all of its stores and also online.
In April, after failing to manage its debt effectively, Nine West filed for bankruptcy with a plan to sell some assets and reorganize others. It had accumulated more than $1 billion of debt, according to the Chapter 11 filing in New York. In June, it sold the Nine West and Bandolino brands to Authentic Brands.
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