Bankrupt retailer to shutter 11 stores across the Gulf Coast

Tuesday Morning Corp., the Dallas-based discount retailer, is closing 11 stores across the Gulf Coast as the company enters its second bankruptcy in three years.

The closings will affect shoppers across the entire region, from Naples north to Spring Hill in Pasco County. In all, 24 of the chain’s stores will close in Florida and about half of its 464 stores nationwide will shut down.

The company, which filed Feb. 14 in Texas, does not say in the filing how much it will save or hopes to generate from the liquidation sales or how many employees will be affected. As of Monday afternoon, no Worker Adjustment Retraining and Notification notices from Tuesday Morning had been posted on Florida’s WARN database.

In court papers, attorneys write that the company has “faced unprecedented challenges, including underperforming sales at their 464 retail locations.”

“To address these challenges, (the company’s management team), in the exercise of their sound business judgment and in consultation with their advisors, ultimately determined that immediate liquidation of the company’s inventory at its underperforming store locations under the supervision of the bankruptcy court is the best strategy to maximize value for the benefit of creditors.”

The inventory liquidation sales and shuttering of the stores that are closing will take about eight weeks, according to court filings. Once they are complete, the company will prepare the properties to be turned over to landlords.

The retailer first filed for Chapter 11 bankruptcy in May  2020.

In the months leading up to its most recent filing, it delisted its stock from the NASDAQ Capital Market in January, replaced its CEO and several C-level executives in November and secured a $35 million investment from Retail Ecommerce Ventures in September.

In its initial bankruptcy filing Feb. 14, the company says it has between 1,000 and 5,000 creditors and lists its assets at between $100 million and $500 million. Its debts are also listed at between $100 million and $500 million.

Tuesday Morning is not by any means the first company to have filed for court protection from creditors twice — a practice dubbed Chapter 22. Among the familiar names to have filed more than once is Radio Shack.

Tuesday Morning was founded in 1974 by entrepreneur Lloyd Ross. According to a history of the company, Ross worked with manufacturers who would have leftover inventory. He began to buy the excess merchandise and decided to “host the world’s greatest garage sale” in a Dallas warehouse on a Tuesday morning.

He opened the first store about five years later and the company went public in 1984. At the time of the filing, the chain was in 40 states.

According to the company website, liquidation sales have started at all the stores that are closing.