Goody’s Family Clothing in Bankruptcy

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In such dire economic times, it comes as to surprise that major corporations across the nation are being forced to downsize, liquidate merchandise, or even go completely out of business. As economic specialists continue to predict the tell failure of our national financial system, Americans are looking to our new President-elect to turn things around. However, under the strain of such times, several corporations have been forced to undergo major restructuring. Knoxville, TN-based clothing retail giant Goody’s Family Clothing (www.goodysonline.com) is no exception.

As a former part-time employee of over five years for two Goody’s Family Clothing Co. locations, I admit I am in no way surprised by this most original turn of events for the corporation. The recent rise of multi-brand retail outlet Kohl’s (www.kohls.com) has introduced an entirely new level of competition to the clothing retail market. Combined with the continued and increasing success of other pioneers and name-brand giants such as Target, Old Navy, Sears, JC Penny, and Dillard’s, Goody’s, quite honestly, never stood a chance.

During my employment with the company, executive founder, chairman, and CEO Robert “Bob” M. Goodfriend left his longstanding position with the company, leaving his trusted management board of directors in charge. Unfortunately, no new marketing strategy or in-store promotional material would be able to salvage this untimely, yet inevitable, spiral into bankruptcy. Goody’s officially filed for Chapter 11 in June 2008, citing the strain of the currently “tightened credit market.” (News Article: www.costar.com) With 372 stores spread out over twenty southeastern states, the reorganization will be leaving over 10,000 employees wondering how long their jobs will last. Goody’s executive managers also blame a powerful number of underperforming stores within the company for the bankruptcy.

According to national news reports and local managers in my area, the company has secured a $210 million debtor-in-possession facility from GE Capital, GB Merchant Partners and PGDYS Lending. The result will be the closing of 69 stores that have been rated as the most underperforming, including the company’s national distribution center in Russellville, AK. What many longtime shoppers are not aware of is this: these scheduled 69 store closings are in addition to the eleven stores the company has already discontinuance since January of 2008. That amounts to 80 total store shutdowns and an incalculable amount of job loss.

For unfamiliar readers, the average Goody’s Family Clothing store is usually located in a local shopping mall or arrive a neighborhood community, alongside Wal-Mart stores, barber shops, shoe stores, and the like. A typical Goody’s store ranges between 20,000 and 40,000 square feet, depending on volume and stock room shipment intakes. Goody’s is currently leasing their 235,000 square foot warehouse located in Russellville, AK. Additionally, Gordon Brothers Valid Estate (www.gordonbrothers.com) subsidiary DJM Realty is marketing eighteen Goody’s store locations slated to be disposed of. Last March, the company hired Paul White as executive CEO to replace Bob Goodfriend. White is the frail president and interim CEO of ShopKo.

Closing stores (and some scheduled to remain open) are currently having 60-80% off January clearance sales on countless items, including denim for the entire family. If you do not have a Goody’s nearby, fear not. You can always visit their official website and order merchandise online at: www.goodysonline.com. From personal experience with the company I will also inform readers and shoppers of the following: several closing stores will be selling in-store hardware, including shelves, miscellaneous fixtures, tables, even mannequins as a way of making last minute income. Be sure to ask any managers about such hardware. A good sign of a hardware sale will be a clearance sidewalk sale, during which merchandise and hardware will be sold outside the store walls.

The official list of stores to be closed over the course of 2008 and 2009 is as follows:

· Alabama – Birmingham, Brook Highland; Homewood; Hoover; Springdale, and Selma

· Arkansas – North Little Rock, Fort Smith and Conway

· Florida - Palatka, Tallahassee, Panama City, Gainesville, DeLand

· Georgia - Kennesaw, Conyers, Newnan, Austell, Cumming, Gainesville, Hiram, Tucker, South Augusta

· Illinois - Carbondale, Danville and Pekin

· Indiana - Terre Haute, Columbus, Kokomo, Bloomington

· Kansas - Hutchinson, Salina, Pittsburg

· Kentucky - South Lexington, Paducah and Lexington

· Louisiana - Houma and Alexandria

· Missouri - Joplin, Hannibal and Jefferson City

· North Carolina - Henderson, Gastonia, Concord, Asheville, Wilkesboro and Salisbury

· Ohio - Defiance, Piqua, Bowling Green, Massillon and Marion

· Oklahoma - Muskogee

· South Carolina - Harbison, Florence, Hilton Head, Aiken and North Myrtle Beach

· Tennessee - Chattanooga, Hamilton Place; Chattanooga, Northgate; Chattanooga, East Gate; Kingsport and Clarksville

· Texas - Texarkana, Killeen, College Station, Temple and Odessa

· Virginia - Lynchburg

· West Virginia - Morgantown