Fashion Retailer Rue21 Files for Chapter 11 Bankruptcy, Shuts Down All U.S. Stores Including Indiana Locations

Fashion retailer rue21 is in the process of filing for Chapter 11 bankruptcy and closing all of its stores, including more than a dozen in Indiana. The company plans to shut down all 543 U.S. stores within the next two months and conduct large “going out of business” sales, selling its intellectual property as well. This is not the first time rue21 has faced financial troubles, as they previously filed for bankruptcy in 2003 and 2017.

Rue21 currently has around 4,900 employees and $194.4 million in debt. Despite attempts to sell the business, the company could not find a buyer willing to pay more than what it would earn through liquidation. As of Friday morning, rue21 has not issued a press release or made any public comments about the bankruptcy.

Indiana customers will no longer have access to rue21 stores as the company listed 17 locations in the state before filing for bankruptcy. Founded in 1970 as Pennsylvania Fashions Inc., rue21 has undergone multiple name changes and bankruptcy filings over the years. Financial consultant Gordon Brothers has been hired by rue21 to assist with store closing sales as they attempt to sell off their inventory and assets at discounted prices before closing down shop permanently.

The closure of rue21 stores highlights the challenges faced by brick-and-mortar retailers in a rapidly evolving market, where online shopping continues to dominate sales and consumer preferences shift towards e-commerce platforms that offer more convenience and selection at competitive prices.