Atlanta-based Swoozie's, which sells festive, colorful stationery and gifts at 43 stores, including two in Charlotte - at Blakeney and Morrison - has filed for Chapter 11 bankruptcy protection. Chapter 11 filings traditionally allow businesses to keep operating while they shed debts and reorganize. However, Reuters reports that Swoozie's trying to sell itself to a buyer or liquidator by the end of the month, citing the inability to refinance or repay its debt.
The company has 43 stores in 15 states and 350 employees, according to reports. It has less than $10 million in assets and between $10 million and $50 million in debt, according to the filing, and has taken a financial hit since buying 13 stores in the Northeast that have underperformed.
The overall recession has also contributed, the Atlanta Journal-Constitution reported. A company spokeswoman told the paper it is unclear how many stores may close as part of the reorganization, but Swoozie's locations currently are operating normally.
Wednesday, March 3, 2010
Swoozie's files for bankruptcy
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2 comments:
>> festive, colorful stationery
Translation: "pretentious, overpriced stationery".
I feel bad for the employees; a lot of good hardworking people are going to get hurt. The bankruptcy filing was not unexpected. Kelly and her late husband were two of the most unpleasant people I ever met and ran the company like a couple of crazy people. They tolerated stealing from some people if they were part of the “in crowd”, but ran good managers out of the company if they didn’t play suck up politics. Yes, it is true. An employee was caught loading her car with stuff from the store at midnight, and because corporate liked her, the manager was not allowed to fire her. Most employees had keys and alarm codes so who knows how much theft was going on. A stock boy was caught steeling merchandise at the same store, throwing “empty” boxes in the trash and coming back at night to get them.
Store managers knew best what type of merchandise worked in a particular market but Swoozies refused to listen and would send beach themed stuff to Chicago and cow town themed stuff to Dallas. So one store would be chronically out of stuff hot for their market, while another store would have the same thing they couldn’t sell. Managers would ask if they could ship the stuff they couldn’t sell to the stores that couldn’t keep it in stock: No! Not allowed.
Swoozies corporate was a nightmare and all special orders went through Atlanta corporate. From the two stores I saw, Swoozies was getting killed on special orders because of mistakes at the corporate level and because Swoozies corporate would not allow store managers to change bad practices.
I always thought that the private investors who backed the business would eventually kick Kelly and David out and bring in their own management team. Oops, should have!
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