Robb & Stucky, a high-end luxury furniture retailer based in Fort Myers, Florida, recently announced that it was filing for Chapter 11 bankruptcy as a result of the poor housing market.
Court papers related to the business bankruptcy filing reveal that the company has between $50 million and $100 million in liabilities, and owes money to thousands of creditors.
In an official statement, Robb & Stucky announced that the bankruptcy filing will chart the company's future path, a path that may eventually lead to the sale of the company. Representatives went on to say that the failing real estate market in Florida since the middle of 2007 has caused the company to struggle. Although the real estate market could make a comeback soon, the furnishing market lags behind as homeowners can barely afford their homes, let alone high-end furnishings.
Robb & Stucky has filed for Chapter 11 bankruptcy around the same time that other furniture chains have also had to either close up completely or close just some of the worst-performing stores.
Robb & Stucky, which started in 1915, encompasses approximately a dozen retail stores in four states, though most of its stores are in Florida. The retail stores are expected to stay open during the filing.
Looking to the future, with a still struggling economy, more businesses that focus on high-end products for the home may find themselves in similar situations to Robb & Stucky as people move toward either not buying at all, or sacrificing quality by buying less expensive products.
Source: Orlando Sentinel, "Robb & Stucky files for Chapter 11 bankruptcy protection," Arlene Satchell, 21 Feb 2011