The creation of apparel retailers has often been rooted in spinoffs and sales of successful establishments.
Gap Inc’s (GPS) Gap stores founders Don and Doris Fisher opened their first store in San Francisco selling men’s Levi’s (LEVI) jeans, vinyl records, and tapes in 1969, according to the company’s website. The retailer went public in 1976, and by March 1979, the chain had 375 stores nationwide.
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The San Francisco-based company in 1983 purchased Banana Republic, a two-store safari-themed retail store founded in 1978 in Mill Valley, Calif., which grew to over 340 stores.
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The Gap in 1994 spun off its Gap Warehouse concept into a new retailer, Old Navy, and by 1997, it would become the first retailer to reach $1 billion in sales within four years.
Gap in 2020, however, said that it would close up to 350 Gap and Banana Republic stores by 2024.
Another iconic apparel retailer The North Face was founded in San Francisco’s North Beach neighborhood in 1966 by outdoorsman and environmentalist Doug Tompkins, who was born in Ohio and raised in Millbrook, N.Y. Together with his wife Susie Tompkins, the founders created durable and reliable outdoor products that could withstand harsh weather conditions and outdoor activities, the company’s website said.
The North Face moved to Berkeley, Calif., in 1968, and Doug Tompkins sold his interest in the company for $50,000, and that same year used the funds to help launch a new apparel brand with his wife Susie and a partner Jane Tise, Esprit.
The company began as the Plain Jane Dress Co., before changing its name to Esprit de Corp., and then just Esprit. By 1989, the brand had become a trendy teen fashion retailer that had expanded to about 80 stores and outlet shops, SFGate reported. That same year, the Tompkins sold controlling interest to Michael Ting, who would purchase their remaining interests in 1996.
The brand began to fade in the 1990s, and the company’s headquarters moved from San Francisco to Los Angeles. By 2011, Esprit decided to close or sell its 93 North American stores. The Covid-19 pandemic in 2020 and other financial distress led to the closing of all 56 of its stores in Hong Kong, Macao, Malaysia, Singapore, and Taiwan.
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Various Esprit European operations began filing for insolvency and closing stores across the continent in May 2024. So far, about 13 Esprit Holdings subsidiaries have filed for insolvency in Europe and Hong Kong.
Esprit storefront entrance. (Photo by: Jeffrey Greenberg/Education Images/Universal Images Group via Getty Images)
Jeff Greenberg/Getty Images
Esprit US subsidiaries file Chapter 7 bankruptcy
And now Esprit Holdings U.S. subsidiaries Esprit U.S. Distributors Ltd. and Esprit U.S. Retail filed for Chapter 7 bankruptcy on Oct. 25 in the U.S. Bankruptcy Court for the Southern District of New York, seeking to liquidate their remaining assets.
The company had total assets of about $40.8 million and $61.4 million in liabilities at the end of June, Inside Retail reported.
The debtor faced high costs related to inflation, interest rates, and energy prices, as well as fallout from the Covid-19 pandemic and international conflicts, Retail Dive reported. The company also has long-term leases for unsuitable-sized stores, high labor costs, and issues with logistics.
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