The New Year is poised to claim its first big victim in retail.
Goody’s Family Clothing – a 55-year-old retailer that operates 287 discount stores across the Southeast – is going out of business for good, sources told The Post.
Following a disappointing holiday season that has left it short on cash, Goody’s will hold an auction to liquidate the chain early next week, sources said.
The chain’s demise is another blemish on the reputation of its owner, Prentice Capital. The New York firm – founded by hedge-fund tycoon Steve Cohen’s former protégé Michael Zimmerman – also owns bankrupt retailers KB Toys and Whitehall Jewelers, and held a stake in now-defunct Steve & Barry’s.
Knoxville, Tenn.-based Goody’s, which had reorganized its business in October following four months in Chapter 11, is being forced into liquidation by skittish lenders despite weeks of talks to keep the chain alive, sources said.
As reported in The Post yesterday, Goody’s had staged a conference call with its suppliers during the week of Christmas asking for unusually loose terms on inventory deliveries.
“They were saying, ‘Please help us so we’ll continue to be here,’ ” said an executive at one apparel supplier, who subsequently stopped shipping merchandise in disgust.
The defeat of Goody’s signals a tough road ahead for regional retailers, who lack the scale and credit profile of big rivals like Wal-Mart, Macy’s and J.C. Penney.