Popular retail chain skips bankruptcy, moves right to liquidation
It has been a miserable period for retailers. Companies that were once unqualified success stories have been unable to recover from Covid pandemic-era losses.
Retail, especially food-related retail generally has relatively low margins. That makes the difference between success and disaster a fairly thin line.
Many retailers entered 2020 healthy but had to take on debt during the pandemic’s lockdown period. Some companies had to shut down or shift their focus to lower-margin items consumers needed to get through that period.
It was a time when even if you could keep your doors open, costs were higher and sales were lower. That forced many retailers to borrow money and even as sales patterns returned to normal, servicing that debt created a burden that some companies could not carry.
That has led to a number of bankruptcies with big names Bed Bath & Beyond, Tuesday Morning, and Christmas Tree Shops liquidating. It’s a scenario that has also devastated the craft brewery market and caused multiple regional furniture chains to close.
Now, the retail apocalypse has another victim as a popular regional upscale convenience store/small grocery has closed its doors in preparation for the company’s assets to be liquidated.
Foxtrot Market closed all its stores in late April. Image source: Benedikt Geyer from Pixabay
Foxtrot Market closed unexpectedly
Urban convenience store and delivery chain Foxtrot Market and small-format grocer Dom’s Kitchen & Market unexpectedly closed its doors on April 23, Supermarket News reported.
Foxtrot had 33 locations in Chicago, Washington, D.C., Dallas and Austin, Texas. Dom’s had two stores in Chicago.
The company shared news of the closure on its website which was replaced with a single page that contained a letter to its customers.
More bankruptcy:
“We explored many avenues to continue the business but found no viable option despite good faith and exhaustive efforts,” the company posted. “This decision was not made lightly, and we understand the impact it will have on you, our loyal customers, as well as our dedicated team members.”
The chain has not filed for bankruptcy and customers held out hope that a buyer would step in or the company would find a lifeline. That’s not going to happen.
Foxtrot Market headed for liquidation sale
A public notice was filed that makes Foxtrot’s fate clear.
“On May 10, 2024, at 10 a.m. Pacific Time, a foreclosure sale of substantially all of the assets of Foxtrot Ventures Incorporated; Foxtrot Retail, Inc.; Foxtrot Retail D.C., LLC; Foxtrot Intermediate Texas, Inc.; Foxtrot Retail Texas, Inc.; and Foxtrot Holdings Texas, Inc. will take place via Microsoft Teams video conference conducted by DLA Piper LLP (US), counsel to the debtor’s secured creditor JPMorgan Chase Bank, N.A. The sale may be canceled or continued from time to time at the direction of JPMorgan Chase Bank, N.A.,” according to the notice.
In theory, a buyer could step in and buy the assets needed to reopen the chain, or at least parts of it.
“The debtors were in the business of retail food and beverage sales. The assets to be sold include inventory, intellectual property, accounts, chattel paper, documents, furniture, fixtures & equipment, general intangibles, and goods,” the filing continued.
Dom’s Kitchen and Market was not mentioned in the public notice.
Foxtrot has not filed for bankruptcy and the company’s closure was not expected. The company’s over 300 employees did not get severance and there are multiple lawsuits related to Foxtrot’s owners not providing legally required warnings to workers.
The company’s owners tried to be gracious in their farewell message.
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“We want to express our sincerest gratitude for your support and patronage throughout the years. It has been our highest honor to elevate the everyday and create a remarkable shopping experience for people who love food as much as we do,” Foxtrot shared in its farewell letter.