Brookstone is that fun little store in the mall that we all love to stop by and look at all the neat little gadgets that are for sale. It carries that cool stuff that one cannot find anywhere else. Remote controlled chairs, key chains that beep, and every type of massage and radio equipment known to mankind. However, keeping the stores up to date has been harder and harder. Malls are not inexpensive pieces of real estate to maintain and they are largely a failing model. Malls have been closing at a much faster rate than they have been opening. Unfortunately, Brookstone has heavily invested itself in the mall model. What they want to do is follow the Chick-fil-a model. Chick-fil-a saw this trend years ago and started building restaurants that were independent of the malls.
The problem is even greater for Brookstone. They have very high-dollar leases that keep them locked in. They need substantial capital to upgrade their inventory. Those cool little gadgets have not really changed in the last ten years and there is not much new in those stores. That takes money and they are using all their money keeping those high-rent stores open. All of this is happening as mall traffic has dropped. Brookstone has attempted to sell the company for a number of years. Unfortunately, there have been no takers.
The latest rumors indicate that Brookstone will look to file bankruptcy in the next couple of weeks. If you are a fan of Brookstone, take heart! It does not necessarily mean that the company will end. Look at American Airlines. They filed bankruptcy and have come back stronger than ever. If Brookstone files a reorganizational bankruptcy, they will be able to get out of those leases that are draining all of their capital. If they decide that the company just cannot succeed under any model, they have the option of closing the stores also. Just like individuals, they can only spend the money they have and sometimes that does not get them where they need to be.
Individuals are often caught in the same situation. They have more and more of their capital going to pay debt. They get to the same place as the big companies. They no longer have the capital they need to purchase transportation or housing to make a change. Just like the large company, sometimes they need to reorganize or simply escape the traps they are in. Bankruptcy gives them that option. It may give you the fresh start to walk away from those old debts caused by changing economic times, divorce or illness.
If you are faced with too much old debt, bankruptcy can be used to help you become more lean and efficient. It can help you begin setting money aside for the children’s education and future. If you are in this situation, book an appointment with a skilled bankruptcy attorney. At Bailey & Galyen we would like to help you achieve your new future.
