Aeropostale, once a beloved teen retailer, has been struggling.
The company filed for Chapter 11 bankruptcy in May, following quarter after quarter of declining sales.
Apparently, the company’s styles were failing to align with what fickle teens today actually like, even though it tried to appeal to young people by employing YouTube and social media sensation Bethany Mota.
Unsurprisingly, the period hasn’t been easy on employees.
In fact, during this uncertain time, the store has been particularly intense, one anonymous employee divulged to Business Insider.
Most employees didn’t even know about store closures until they read it on the day the company filed for bankruptcy, according to him.
When the Aeropostale did make the news public, the company announced it had plans to close 113 stores in the US and all 41 stores in Canada. As of the Sunday before the filing, there were total 739 stores and 25 locations of its tween offshoot PS, according to Reuters.
“It’s continued to be very unknown as to what they plan to do, and it seems as though we are notified once the plans are already in motion and occurring,” the employee wrote in an email.
“Several District Managers and Store Managers who have been with the company for 7+ years are let go from being dissatisfied, and not asked why or what could be done to save them,” he added.
He also said that both he and his fellow employees weren’t being treated well.
“We feel undervalued and underappreciated,” the employee wrote. It didn’t help that he felt the company was throwing away money on an annual meeting in Florida for corporate employees called Partners in Profit, which was a three day fully paid conference that included catered meals.
“I stand by the quote, ‘people before profits’ and I never fully understood it until now,” he wrote.
- Thomson Reuters
Meanwhile, Aeropostale is facing and already dire state of the retail industry.
It’s “the weakest of the three A’s” – meaning American Eagle and even the struggling Abercrombie & Fitch – according to a note from earlier this year from Conlumino analyst Håkon Helgesen.
“Being the weakest player in a weak market is a very uncomfortable position and it is one that could yet lead to the eventual failure of the chain,” Helgesen wrote, at the time. “The latest results do nothing to change this view: the jury is still out on whether Aero has a place in the market over the longer term.”
To make the situation even worse, Aeropostale faces the imminent threat of fast fashion retailers like Zara and Forever 21, which have captured the hearts and wallets of teens with their runway-esque trendy apparel at budget-friendly prices. And most mall retailers – and malls themselves – are struggling to survive in an Amazon world; Morgan Stanley has predicted Amazon will hold 19% of the entire apparel market by 2020, up from 7% right now. That would be huge blow to retailers who fail to adapt.
The Aeropostale employee said he noticed some of these problems in the store and specifically cited the “direct competition of the fast fashion brands and the ability of other stores like Hollister, Abercrombie, and American Eagle to keep up with trends and truly appeal to the customer demographic” as one of the reasons for the company’s demise.
Aeropostale did not reply to Business Insider’s request for a comment earlier this week.