2024 has seen a notable string of bankruptcies across a variety of industries. These collapses shed light on the tough economic realities and the kinds of pressures that can push well-established businesses to the edge of failure.
Here’s a closer look at some of the most notable business bankruptcies of 2024.
Chicken Soup for the Soul Entertainment
On June 28, Chicken Soup for the Soul Entertainment, a player in the streaming and entertainment sector, declared bankruptcy.
The company accumulated nearly $1 billion in debt, listing over 500 creditors, including major entertainment entities like Sony Pictures and Warner Bros. Discovery, and retail giants Walgreens and Walmart. According to its bankruptcy filing, as of March, Chicken Soup for the Soul reported having $970 million in debts against assets of $414 million.
Rubio's Coastal Grill
Rubio’s Restaurants, Inc., announced it would close nearly 50 locations in California, and filed for bankruptcy protection once again. This filing, made in a Delaware bankruptcy court on June 5, marks the second such instance in four years for the fast casual chain.
Rubio’s cited several contributing factors to its financial struggles: diminishing in-store traffic due to ongoing work-from-home practices, rising food and utility costs, and significant increases to the minimum wage in California, all of which have placed considerable pressure on many of its locations over the past few years.
Big Lots
On September 9, Big Lots entered bankruptcy, with Nexus Capital Management acquiring substantially all of its stores and business operations.
Despite the financial reorganization, Big Lots’ CEO Bruce Thorn assured that stores and the company website would remain operational, aiming to “provide financial stability, optimize our operational footprint, and accelerate improvement in our performance.”
Rue21
The Pittsburgh-based retailer, Rue21, filed for bankruptcy on May 2—its third filing—marking the end of an era for a company that once boasted 1,200 locations at its peak.
With $200 million in debt and 4,900 employees, the company’s financial struggles persist despite previous bankruptcies in 2017 and 2003, which failed to stabilize its operations.
Express
Express filed for Chapter 11 bankruptcy on April 22, a move that has allowed the fashion retailer to stay in business, exit outdated leases, and potentially rejuvenate its brand.
A group of investors including WHP Global and mall operators Simon Property Group and Brookfield Properties formed a joint venture, PHOENIX, which successfully received court approval on June 14 in New York to acquire Express.
99 Cents Only
After declaring bankruptcy on April 7, 99 Cents Only Stores prepared for a major brand transition, with nearly 200 stores set to reopen as Dollar Tree locations.
This followed approval from a bankruptcy court in Delaware, marking an end to the brand’s 42-year legacy amid consumer demand shifts, inflation, and theft.
Joann
Craft chain Joann filed for bankruptcy on March 18 but received court approval for a restructuring plan that eliminated $505 million in debt while keeping all 815 locations open.
U.S. Bankruptcy Judge Craig Goldblatt praised the outcome as beneficial for the company’s employees, landlords, and suppliers.
KidKraft
KidKraft declared bankruptcy on May 10, yet remained optimistic about future prospects. Geoffrey Walker, president and CEO of KidKraft, expressed optimism about the future, saying “Today’s announcement marks an important step forward for KidKraft that will position us to continue investing in our industry-leading products and delivering for our valued customers well into the future.”
He also highlighted the anticipated support from new ownership by Backyard Products LLC, which has agreed to purchase KidKraft for an estimated $39 million.
The Body Shop
On March 9, The Body Shop filed for Chapter 7 bankruptcy. The UK-based cosmetics company announced the closure of its US operations with immediate liquidation sales at 33 of its 105 stores in Canada.
The decision comes as high inflation in recent years has particularly impacted traditional mall-based retailers like The Body Shop.
Red Lobster
Red Lobster sought Chapter 11 protection on May 19 after its all-you-can-eat shrimp promotion failed financially, according to the new CEO, Damola Adamolekun.
In an interview with CNN, Adamolekun explained that the promotion overtaxed staff and disrupted operations, saying, “You stress out the kitchen. You stress out the servers. You stress out the host. People can’t get a table,” which led to operational chaos and contributed to the company’s financial troubles.
