Betsey Johnson's company announced yesterday that it would be filing for bankruptcy and closing its stores, putting a rumored 350 employees out of work. But Betsey is not going down without a fight: Her brand and aesthetic will live on.
We can still expect to see Betsey cartwheeling down the runway at New York fashion week come September, WWD is reporting. The designer is staying on as creative director of the brand, and will continue designing sportswear, though, as mentioned yesterday, the emphasis will be on her more moderately priced Betsey Johnson line, which has sold much better than her runway collection. WWD reports that aobut 75% of the spring merch will be moderately-priced, and the rest "editorial- and designer-range pieces."
While 63 freestanding Betsey Johnson stores will be closing, the WSJ reports that four or five flagships will remain open in New York City and "a few other cities." And the Betsey Johnson collection will continue to be sold at Saks Fifth Avenue, Bloomingdales and Nordstrom, according to Forbes. The company will have an auction on May 8 for bidders to either purchase the company or to bid on being the liquidator that will hold store-closing sales. We can expect the first store-closing sales to start happening after that auction and continue through July.
Betsey Johnson is understandably upset about it. "I feel so sad for my store people and all my pink girls," she told WWD. "They live and die for me. But I need to be better. I really need to work well and be more efficient." To that end she'll continue to work with Steve Madden Ltd, who owns the intellectual property rights to Betsey Johnson. Madden told Forbes that the wholesale business' revenues were up 50% (think shoes, swimsuits, and intimate apparel), so that will be the focus.
The WSJ points out that Betsey's luxury prices but younger customer base lost out against lower-priced retailers who also cater to that demographic but at much lower prices. And Betsey herself recognizes the challenges of competing against fast fashion. "The competition — the H&Ms, Topshop, Century 21 and the knockoff ability is unbelievable," she told WWD. "Within three days of something being on the Internet, they have seen it, they copy it and they price-beat it."
Betsey Johnson herself is still pursuing tons of new projects, despite the fact that she's turning 70(!) this year. The biggest news is that she'll be starring in a new reality TV show with her daughter Lulu, called Betsey + Lulu, which will air this July. She said of the show, "I am trying to make it relevant, deep and interesting about fashion rather than about gossip, girls, makeup and hair." She's also releasing two more fragrances to follow up last year's release of Too Too. The next one will be called Too Too Pretty, with a third one in development.
So while this is a setback for the brand, Betsey Johnson is very much still here. Thank goodness.
UPDATE: Elle got the scoop from an anonymous source inside Betsey Johnson's camp who let on that lay-offs actually started six weeks ago, and that for the last two weeks the members of the runway design team weren't allowed to spend any money. According to the insider, at least three rounds of investors came through but they "weren’t agreeing with Steve Madden’s vision for the brand, which was to take it down-market at a lower price point." The source also said not to expect a runway show this season. The plot thickens.