Major Retail Chain Eddie Bauer Files for Bankruptcy, Gift Cards to Expire
In a significant blow to shoppers, the major retail chain Eddie Bauer has collapsed, filing for bankruptcy and triggering a critical deadline for customers. All gift cards and loyalty programme points earned through the Adventure Points programme will become worthless after March 12, according to court documents. This leaves shoppers with just under one month to use their balances or risk losing money entirely.
Liquidation and Sale Efforts Underway
Catalyst Brands, the operator of Eddie Bauer's stores, is actively seeking to sell the business while it liquidates its Canadian and US locations. The company operates approximately 180 locations across North America, with 24 stores in Canada and the remainder in the United States. During this liquidation phase, all sales at these sites are final, meaning returns will not be accepted on items purchased as the stores close down.
If a sale arrangement cannot be reached, the company plans to commence an orderly wind-down of store operations. The top executive, Rosen, stated to the Associated Press that this decision was not easy but is necessary to optimize value for stakeholders and ensure Catalyst Brands remains profitable with strong liquidity and cash flow.
Impact on Employees and Operations
The bankruptcy filing has significant implications for employees, with about 379 workers in Canada affected when the company sought bankruptcy protection. However, the proceedings do not impact Eddie Bauer's e-commerce and wholesale operations, which are managed by a separate entity called Outdoor 5. This company did not file for creditor protection, allowing online sales to continue uninterrupted.
Additionally, stores outside Canada and the US are unaffected because they are operated by other licensees not involved in the bankruptcy filing. The brand is set to end its brick-and-mortar retail presence in Massachusetts and across the country as the Chapter 11 bankruptcy process progresses.
What Shoppers Need to Know
- Gift cards and loyalty points expire on March 12.
- All sales are final during the liquidation, with no returns accepted.
- Eddie Bauer's online and wholesale operations continue as usual.
- Stores outside North America remain open under separate licensees.
Shoppers are urged to act quickly to utilize any remaining balances before the deadline to avoid financial loss. This development marks a challenging period for the outdoor apparel brand as it navigates restructuring efforts in a competitive retail landscape.
