It hasn't even been quite a year since Henri Bendel closed its often-referenced-but-rarely-traveled doors for good, but it appears another iconic luxury retailer is going out of style. After nearly 100 years of life at the center of New York culture, Barneys is in poor health, having filed for voluntary bankruptcy protection today. It appears that the city's elite set just really isn't building their lives around department store consumerism as it used to be.
The filing implements several drastic steps as the retail fixture clings to life. Unlike Bendel, the company's e-commerce and several locations will stay open, but 15 will shutter, leaving only five flagships and two Barneys Warehouse stores in existence. Barneys will remain prominent in New York and California, with locations including Madison Avenue and Beverly Hills remaining open, but cities including Chicago, Las Vegas, and Philadelphia are all saying goodbye to the signature black awnings. Additionally, the retailer is receiving $75 million in funding while it searches for a buyer, and the world has learned which luxury brands are waiting for Barneys to pay up: notable creditors include The Row, Celine, and Gucci.
“Like many in our industry, Barneys New York’s financial position has been dramatically impacted by the challenging retail environment and rent structures that are excessively high relative to market demand," said Barneys's CEO and president, Daniella Vitale, in a press release. As major of news it always is when such a famous brand finds itself drowning in debt, this does hardly come as a surprise in a market that increasingly revolves around online shopping. Amazon has been building its fashion profile, and while it didn't succeed in its quest to take over New York, everyone and their mother seems more likely to search for a needed item there than go to a department store. Even in the event of a demand for a more luxe experience, websites like Net-a-Porter and Farfetch (which both fall under the Yoox Net-a-Porter Group) are there to help today's digitally-savvy consumer avoid the hassle of traveling to a brick-and-mortar locale. Nevertheless, Instagram has continued to build its shopping profile by partnering with top brands to encourage users to make impulse purchases directly on the app.
While there's still a chance Barneys will weather the storm and adapt to a new era of capitalism, the filing is further proof that even if department stores survive, they can't go on business-as-usual. Bergdorf Goodman and Bloomingdales are still doing OK for now, but online luxury initiatives are quickly becoming stars of the show. While this is the way it is, it does beg the question: can a website ever achieve the same cultural idolization as its department store predecessors? Stay tuned for if the next Gossip Girl features its Gen-Z stars scrolling through streetwear on Farfetch and waiting for the black Net-a-Porter van to arrive.