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Wednesday, May 25, 2022

Sport Chalet to Close All Stores in Bankruptcy

Sport Chalet Inc. will close all existing stores in the coming weeks and has ceased its online operations effective immediately, parent company Vestis Retail Group announced Monday. The La Canada-Flintridge retailer began running store closure sales this week at its 47 locations, and will proceed through April 29 at which point all gift cards, certificates and store credit will no longer be redeemable. Online sales have stopped effective immediately, and the company’s website is no longer operational. In addition, Vestis has filed Chapter 11 bankruptcy. Sports Chalet has been struggling competitively since before it was acquired by Meriden, Conn.-based Vestis in 2014. Vestis acquired Sports Chalet for $70 million in hopes of increasing its market share on a national scale, but was unable to improve the retailer’s financial performance. Vestis also owns retailers Eastern Mountain Sports, an outdoor equipment store with more than 65 outlets; and Bob’s Stores, an active wear retailer with roughly 35 locations. “EMS and Bob’s are now delivering solid performance but have been burdened by limited financial flexibility due, in part, to the unique competitive pressures facing Sport Chalet,” Mark Walsh, chief executive of Vestis said in a statement. “After reviewing a variety of strategic alternatives, we determined that the best path forward is to separate the businesses.” Founded in the late 1950s, Sport Chalet was a ski and tennis gear shop before expanding into the multi-unit chain that it is now. The retailer has 40 locations in California, and a remaining seven stores in Arizona and Nevada. Valley outlets can be found in La Canada, Burbank, West Hills, Porter Ranch and Thousand Oaks. News of its closing comes at a time when the retail industry overall is retooling, and retailers are closing and consolidating stores while revving up their online presence. “Retailers are becoming more specialized and picking categories they want to be known for,” Neil Stern, retail expert and senior partner at McMillian Doolittle in New York said. “Sporting goods retailers are facing two competitive issues. From a brick-and-mortar standpoint there is a lot of growth. People like Dick’s Sporting Goods are expanding and specialty chains REI and Cabela’s have grown to see a lot more physical spaces. Combined with the growth of e-commerce, the market is very competitive.” In the past few months, sporting goods chain Sports Authority Inc. and Pacific Sunwear of California Inc., a surf and skate apparel manufacturer, have filed for Chapter 11 bankruptcy protection. Though PacSun has yet to announce the closure of any stores, Sports Authority plans to close 140 stores nationwide. During the Chapter 11 bankruptcy, Vestis will focus on strengthening its Eastern Mountain Sports and Bob’s Stores operations. A combination of nine EMS and Bob’s stores will close due to unfavorable real estate costs, according to Vestis. “We are confident EMS and Bob’s will be well-positioned to thrive at the conclusion of the process,” Vestis’ Walsh said in a statement.

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