Another chain has joined the list of retailers shutting stores this year as outdoor apparel seller Eddie Bauer has begun holding liquidation sales throughout its brick-and-mortar shops.
The Bellevue, Washington-based retailer, with roughly 180 locations in the United States and Canada, has kicked off store-closing sales across the nation. Catalyst Brands, which operates the Eddie Bauer stores, is preparing to file for Chapter 11 for the chain, as first reported in early January by Octus and later by WWD.
In that scenario, all of Eddie Bauer's stores are expected to close. But several potential buyers have now surfaced that are interested in acquiring part of the chain's brick-and-mortar stores, according to sources familiar with the matter. Of course, it remains to be seen if any of the Eddie Bauer stores actually end up being sold.
Catalyst didn't immediately respond to an email from CoStar News seeking comment on Monday.
Eddie Bauer, a business that's over 100 years old, is part of a growing cadre of U.S. retailers this year that are closing stores, with or without filing for bankruptcy. That group includes the Amazon Fresh supermarket chain, most of off-price seller Saks Off 5th, mall-based apparel chain Francesca's and American Signature Furniture.
But at least one analyst said though the legacy outdoor retailer's name is well known, it has failed to keep pace with its rivals.
"From a consumer perspective, it is nowhere near as exciting as some of the fast-growing players like Fjallraven and Arcteryx," Neil Saunders, a retail analyst and managing director at analytics firm GlobalData, said in an email to CoStar News. "And for many younger shoppers," the Eddie Bauer brand is "seen as somewhat old-fashioned and a bit irrelevant."
New York-based Authentic Brands Group, owner of the Eddie Bauer brand and intellectual property rights worldwide, declined to comment.
Brand licensing
Authentic licenses the brand to Catalyst for the chain's Eddie Bauer stores. In January, Authentic announced that it is transitioning the licenses for Eddie Bauer’s manufacturing, e-commerce and wholesale operations in the United States and Canada to a new partner, Outdoor 5, effective Feb. 2. Catalyst is currently continuing to operate the Eddie Bauer stores under its license with Authentic.
Eddie Bauer has a history of different owners beyond Spiegel. In 2021, the brand was acquired from Golden Gate by SPARC Group, a partnership of Authentic and Simon Property Group with a portfolio that then also included Brooks Brothers, Lucky Brand, Nautica, Aéropostale and Forever 21.
Another Chapter 11 filing would mark the third such proceeding for the Eddie Bauer stores. The first one came in 2003, when its then-owner Spiegel sought Chapter 11 protection. In 2009, Eddie Bauer filed for bankruptcy again. Golden Gate Capital purchased it at an auction.
A year ago, Catalyst was formed by the merger of SPARC and JCPenney, which Simon and fellow mall landlord Brookfield bought out of bankruptcy in 2020. Catalyst's holdings now include not only the department store chain but also Lucky Brand, Nautica, Aéropostale along with Eddie Bauer.
Simon, an Indianapolis-based real estate investment trust, is slated to report its fourth-quarter earnings late Monday afternoon.
Eddie Bauer was a pioneer in the recreational outdoor gear sector, with its namesake founder Eddie Bauer inventing the quilted down jacket. Today it competes with not only fellow legacy brands like L.L. Bean, Patagonia and REI but also newer rivals. And Eddie Bauer has other challenges, according to Saunders.
"There are ... issues with quality deteriorating, which, for an outdoor brand measured by the performance of its products, is very problematic," Saunders said. "Again, other brands like Arcteryx really pride themselves on the technical aspects of their products and push this heavily in customer communications. All of this has depleted sales and that, in turn, has impacted the profitability" of Eddie Bauer's stores.