COVID-19

Brooks Brothers files for bankruptcy

Justin Ho Jul 8, 2020
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A Brooks Brothers store in downtown Los Angeles in 2010. Formal menswear was struggling before the pandemic. Robyn Beck/AFP via Getty Images
COVID-19

Brooks Brothers files for bankruptcy

Justin Ho Jul 8, 2020
Heard on:
A Brooks Brothers store in downtown Los Angeles in 2010. Formal menswear was struggling before the pandemic. Robyn Beck/AFP via Getty Images
HTML EMBED:
COPY

The men’s retailer Brooks Brothers filed for bankruptcy Wednesday, seeking Chapter 11 protection.

Lockdowns and working from home haven’t been great for the men’s formalwear industry. But coronavirus isn’t the only thing that Brooks Brothers has been dealing with. Its mainstay product — the suit — has been losing popularity for years.

Brooks Brothers opened its first store in lower Manhattan in 1818 when the U.S. was made up of 20 states. Future customer Abraham Lincoln was only 9 years old. When the suit as we know it today started becoming popular in the late 19th century, Brooks Brothers cashed in.

“They were right there at the heart of finance, at the heart of politics, really when America was getting its start,” said Susan Scafidi, founder of the Fashion Law Institute at Fordham Law School.

She said Brooks Brothers popularized suits that were ready to wear off the rack. That helped its suits fit more people. But Scafidi said it also made the suit, and the high status it represented, more accessible.

“Everybody had to have a Brooks Brothers suit if you were going to be a middle-class, or upper-middle-class, or even an upper-class business person,” Scafidi said.

By the middle of the 20th century, Sacfidi said, the suit also became a symbol of corporate conformity. Think “Mad Men.”

But in the 1990s, casual Fridays had become a thing. Then, Silicon Valley decided hoodies and sneakers were OK, and casual became mainstream.

Justin Schack, a managing director at Rosenblatt Securities on Wall Street, remembers the suit-and-tie days.

“I used to own Brooks Brothers suits back when I was starting my career, and I can’t remember the last time I did,” Schack said.

Since 2014, the market for men’s suits has shrunk by 11%, according to the research firm Euromonitor. And menswear has changed with the times.

Ken Giddon, co-owner of New York-based menswear store Rothmans, said his biggest seller these days is denim.

“We sell a lot of jeans, and we sell a lot of sport coats with it,” he said. 

But, Giddon said, the suit isn’t dead. The suits he sells tend to be fashionable suits meant for special events.

“It’s not really classic workwear,” Giddon said. “That’s not what the young guy is looking for in a suit.”

The COVID-19 pandemic has only made things worse for the suit industry, as people work from home and stores have closed. As Brooks Brothers files for bankruptcy, it says it’s seeking a buyer for the brand.

COVID-19 Economy FAQs

What do I need to know about tax season this year?

Glad you asked! We have a whole separate FAQ section on that. Some quick hits: The deadline has been extended from April 15 to May 17 for individuals. Also, millions of people received unemployment benefits in 2020 — up to $10,200 of which will now be tax-free for those with an adjusted gross income of less than $150,000. And, for those who filed before the American Rescue Plan passed, simply put, you do not need to file an amended return at the moment. Find answers to the rest of your questions here.

How long will it be until the economy is back to normal?

It feels like things are getting better, more and more people getting vaccinated, more businesses opening, but we’re not entirely out of the woods. To illustrate: two recent pieces of news from the Centers for Disease Control. Item 1: The CDC is extending its tenant eviction moratorium to June 30. Item 2: The cruise industry didn’t get what it wanted — restrictions on sailing from U.S. ports will stay in place until November. Very different issues with different stakes, but both point to the fact that the CDC thinks we still have a ways to go before the pandemic is over, according to Dr. Philip Landrigan, who used to work at the CDC and now teaches at Boston College.

How are those COVID relief payments affecting consumers?

Payments started going out within days of President Joe Biden signing the American Rescue Plan, and that’s been a big shot in the arm for consumers, said John Leer at Morning Consult, which polls Americans every day. “Consumer confidence is really on a tear. They are growing more confident at a faster rate than they have following the prior two stimulus packages.” Leer said this time around the checks are bigger and they’re getting out faster. Now, rising confidence is likely to spark more consumer spending. But Lisa Rowan at Forbes Advisor said it’s not clear how much or how fast.

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