Claire’s, the sparkly, ear-piercing mainstay of the teen mall, is once again in danger of going extinct.
For the second time in seven years, the chain declared bankruptcy on Wednesday. Just one year before a cumbersome loan of almost $500 million is due, it is already having trouble keeping up with the additional tariff charges. The retailer claims that while its North American locations will stay operational throughout the process, its Canadian division will seek a similar bankruptcy proceeding.
Claire’s has attributed its dwindling sales on inflation and consumers’ increasing reluctance to spend money on fads like Barbie purses, Hello Kitty socks, cat-shaped lip gloss, and faux-gold bangles. China, whose goods are subject to the highest tariffs in President Trump’s renegotiation of global trade, supplies the majority of the store’s inventory. As the importer, that has resulted in additional expenses for Claire’s.
“Increased competition, consumer spending trends and the ongoing shift away from brick-and-mortar retail, in combination with our current debt obligations and macroeconomic factors, necessitate this course of action for Claire’s and its stakeholders,” Chris Cramer, the company’s CEO, stated in a
Since the 1970s, Claire’s has been making waves in America, gradually acquiring American, British, and Japanese competitors who sell jewelry and accessories. Claire’s had become a mall mainstay by the early 2000s, when its popularity peaked.
Apollo, a private equity group, found the chain appealing and executed a leveraged takeover in 2007. Claire’s took on a lot of debt as part of the acquisition, which it intended to pay off as the chain expanded quickly—until it didn’t. Claire’s had to deal with declining foot traffic and increasing online competition as malls did.
The company has attempted to develop over the last ten years by negotiating agreements to sell trinkets at CVS pharmacies and growing brand agreements for well-known Disney and Mattel characters. However, as Claire’s oversees its network of almost 3,000 Claire’s and Icing physical stores, its youthful customers are increasingly following fads on TikTok and are being snatched away by more established competitors like Amazon and Walmart or the incredibly low-cost Shein and Temu.
After its creditors took possession, Claire’s filed for bankruptcy in 2018 with $1.9 billion less in debt. Bloomberg revealed in May that Claire’s was postponing interest payments and intended to take on more debt to make up the difference. December 2026 is when the company’s loan of around $500 million is due.
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