Retail's Latest Casualty: Payless

Payless Inc., the seller of discounted shoes, could declare bankruptcy as soon as next week. According to a Bloomberg report, retail's latest casualty is expected to initially close up to 500 of its stores as part of a reorganization associated with its bankruptcy.

The retailer, owned by private equity firms Golden Gate Capital and Blum Capital Partners, initially planned to close up to 1,000 stores but the number of store closures isn't set yet.

Payless was founded in 1956 and according to USA Today, the company claims it's the largest specialty family footwear retailer in the Western Hemisphere given its more than 4,000 locations in 30 countries.

Warning Signs Were There

Footwear News, a leading online shoe magazine, reported in late January it was made aware of several of Payless' major vendor partners who said the retailer has fallen months behind on its payments.

Moreover, Payless has been busy meeting with debt-restructuring experts to address its $665 million debtload.

Footwear News followed up from its January report in early March and reported that several of Payless' vendor partners indicated they haven't been paid since August for the footwear and other products that were shipped.

The publication also suggested Payless has been hard hit by the surge in popularity of off-price retailers, including DSW Inc. DSW and TJX Companies Inc TJX.

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