It’s been a go-to for men wanting decent suits at less than department store prices for decades, but some bad business decisions compounded by the economic shutdown could finally close the doors of Men’s Wearhouse and Jos. A. Bank, brands owned by Tailored Brands, for good. Like many others, without sales the parent company can’t pay its bills.
As of May 2, the company had long-term debt of $1.4 billion and $244.2 million of cash and cash equivalents. Only about half of the company’s stores are open, and its stock price is down 70% for the year. First-quarter net sales for the retailer, which also owns men’s clothing store Jos. A. Bank, plunged 60.4% as stores were closed due to coronavirus-led nationwide lockdowns.
Tailored brands said in an SEC filing:
“If the effects of the COVID-19 pandemic are protracted and we are unable to increase liquidity … we may be forced to scale back or terminate operations and/or seek protection under applicable bankruptcy laws.”
Some of the pain is the company’s own doing. After infamously firing founder and pitchman George Zimmer years ago, the board voted to take on debt to buy Jos. A. Bank, a move Zimmer had opposed for years. Investors cheered for a bit, but then when additional sales didn’t materialize, the stock rolled over.
Zimmer, famous for his line, “You’re going to like the way you look, I guarantee it!”, went on to establish other companies, but now he could do something it seems like he’s wanted for some time… get his old company back. He might even get a discount.