Carol’s Daughter stores file Chapter 11 bankruptcy according to Wall Street Journal
Companies affiliated with Carol’s Daughter filed for Chapter 11 bankruptcy protection Thursday in connection with the beauty brand’s move to close most of its stores.
CD Stores LLC, formerly known as Carol’s Daughter Stores LLC, filed its Chapter 11 petition with the Manhattan bankruptcy court, as did the individual companies behind Carol’s Daughter stores. Court papersshow that CD Stores is 100% owned by parent company Carol’s Daughter Holdings LLC (the parent company didn’t file for bankruptcy). And the petition, which reported assets and debts each in the $1 million to $10 million range, was signed by Carol’s Daughter Chief Financial Officer John D. Elmer.
In new court papers filed Thursday afternoon, Mr. Elmer said most Carol’s Daughter stores have been unprofitable since 2010. Before the bankruptcy filing, the company closed all but two of its seven stores and terminated 29 of its 42 employees. It hopes to use its time in Chapter 11 to reorganize and consolidate its operations around its two open stores, in Brooklyn and Harlem. Besides the stores, Carol’s Daughter products are offered for sale on its website and through such third parties as the Home Shopping Network and Sephora.
In fact, Carol’s Daughter products are now available in more than 2,000 other retail stores around the U.S., according to Richard Dantas, chief executive of Carol’s Daughter. He said that the company is refocusing its distribution strategy to focus on these retailers.
“Today’s filing in no way reflects the parent company’s healthy financial situation, and is a part of its plan to grow the brand through national retail outlets,” Mr. Dantas said Thursday in an emailed statement.
Joining CD Stores in Chapter 11 were such affiliated companies as CD Store Atlantic Terminal LLC and CD Store Roosevelt Field LLC, which respectively share addresses with Carol’s Daughter stores in Brooklyn and Garden City, N.Y.
Chantal L. McKelton says
April 30, 2014 at 9:15 amThe articles that I read about this subject don’t really clarify Lisa Price’s financial situation, and maybe that’s not the point. The point that I would like to make after reading it is that if you market your business exclusively towards the Black community, the Black community will inevitably let you down. The sad, painful truth is that *we* look for reasons not to support our own. I’ve been natural for almost 6 years, using a lot of products from Black-owned companies, and the only people who go out of their way to denounce the products that I use are Black people. “The price is too high!”, “The ingredients are cheap/junk/too many chemicals!” “I like my cheaper products better!” “Why don’t they give better discounts?” I don’t know about Lisa Price’s situation, but I do know that more Black people complain about her products than other cultures. As someone who has tried and failed more than once to grow my business in the Black community, I am learning that I have to depend on more than the support of my own people to be successful. My products have to work for eery culture. Maybe Lisa’s learned that the hard way.
Jo says
May 6, 2014 at 9:41 amI hear you Chantal, however I also think a business decision was made to ‘corner the market’ with a go to brand. By having a strong physical presence. It was a gamble and it didn’t pay off. However they seem to have cut the losses and now focusing on distributing using outside outlets. Another problem is that their products are not exclusive. Why would I choose CD over another brand or my own creations? I might buy something because it is made by us for us, but I will only continue to use it if it actually works for me, practically and financially. That goes for anything.