(NEWS DAY) — Mass-market shoe retailer Payless Shoe Stores has begun the process of liquidating and shuttering its North American operations after filing for bankruptcy last year, but the company is assuring that its stores in Latin America and the Caribbean (excluding Puerto Rico) will remain open.
In fact, the company said it plans to expand in the region over 2019.
“We are proud of our accomplishments in Latin America and the Caribbean, including our leading market share and strong store footprint,” Mario Zarazua, chief financial officer for Payless, said in a release.
The company said it is either number one or two in the markets in which it operates in Latin American and the Caribbean.
It already has 420 stores across 20 countries in Central and South America and the Caribbean, opening 19 stores in eight countries, and plans to open new stores this year. It also launched its e-commerce option in Costa Rica and Colombia last year, and is exploring ways to bring additional markets online.
“We look forward to building upon our success in these regions by adding new stores and a broader online reach. While Payless’ North American stores have faced difficulty, due to a challenging retail environment, our thriving businesses in Latin America and the Caribbean have considerable profitable growth potential and remain an integral part of our long-term strategy,” Zarazua said.
Payless’ North American stores are among the victims of the “retailpocalypse,” which has seen several prominent brands – including Toys R Us, Nine West, Claire’s and Sears – filing for Chapter 11 bankruptcy protection in American courts after a downturn in the US economy and shifts in consumer trends away from mid-tier mass-market brands and traditional store-front shopping, turning instead to online purchases.
Payless filed for bankruptcy protection in the US, and in Canada, according to the Companies Creditors Arrangement Act, yesterday, and all 2,500 of its North American stores will be closed. The company will liquidate the assets in these jurisdictions, but, it stressed, retail operations outside of North America, including its company-owned stores in Latin America and the Caribbean, are separate legal entities and are not included in the Chapter 11 or CCAA filings.
In 2017, Payless had filed for Chapter 11 bankruptcy but managed to turn around. Last year, the company opened a Payless Super Store in Trincity Mall. In an interview with Newsday, the company’s vice president for Latin America and the Caribbean, Denise Bernard, said the bankruptcy was exclusive to North America.
“Put simply, our Latin American and Caribbean business has been extremely solid, strong and successful. We were not impacted by what went on in our business in North America.
“Latin America and the Caribbean has maintained a solid performance throughout the course of the 17 years that we have been operating in this market. TT, specifically, has been one of our most successful markets throughout the entire chain,” Bernard said then.