Swimco to cut five stores, downsize HQ under Bankruptcy Act creditor proposal

Swimco to cut five stores, downsize HQ under Bankruptcy Act creditor proposal

CALGARY — Canadian swimwear brand Swimco Group is seeking creditor protection, citing impacts from the COVID-19 pandemic.

The company filed a notice in June that it intended to make a proposal under the Bankruptcy and Insolvency Act, according to legal documents posted online by Deloitte Restructuring.

Chief executive Lori Bacon says the proposal to creditors would take the company down to 20 stores, from 25, and give the company time to renegotiate leases and downsize its head office.

Among the store cuts that have been decided so far, there are three stores in Ontario and one in Vancouver.

After temporarily closing all stores and laying off all of its workers — more than 200 employees — in March, Swimco has slowly brought staff back. A court document says the company had reopened 17 stores and re-hired 107 workers by the end of June.

Bacon says sales numbers have not gone back to normal level, and the company will likely have fewer staff in the near term to manage its reduced store footprint.

“From mid-March to late May, the Swimco Group’s only source of revenue was from its online sales,” said Bacon in an affidavit.

“When one of (the company’s) landlords demanded payment by a certain date, the Swimco Group elected to seek creditor protection to allow the Swimco Group to reorganize its affairs to better fit with the new retail reality.”

Swimco is one of many Canadian retailers feeling that “new retail reality.” It joins companies such as Reitman’s Canada Ltd., Aldo Group and Mendocino Clothing Co., which have all filed for some sort of protection under bankruptcy laws.

Swimco, which opened its first store in Calgary in 1982, focused its business model on the in-store “fit experts,” who advised shoppers on flattering swimwear styles. The privately held company, which started in the 1970s doing mail order, launched an online version of its fit expert service in 2014.

Bacon says that, while pools are opening, travel remains limited, and she is anticipating that vacationing beach goers could be restricted until 2023 or when a COVID-19 vaccine is available.

Swimco plans to keep its focus on body positivity and flattering clothing, although it may transition to more athleisure as part of the “stay at home” movement around COVID-19, she says.

“Ultimately, when travel reopens, I think there’ll be a huge pent-up demand,” Bacon said, predicting it’s “not the end” for the company.

— By Anita Balakrishnan in Toronto

This report by The Canadian Press was first published July 27, 2020.

The Canadian Press

Get local stories you won't find anywhere else right to your inbox.
Sign up here

Just Posted

Alberta reports 257 new cases of COVID-19

Central zone has 157 active cases

Samson Cree Nation reeling after 10 year-old-boy-shot, 13-year-old charged with manslaughter

‘Don’t give up, keep praying, we will get through this’

Update: Possible drowning at Pigeon Lake involved man and woman from Edmonton

Bodies recovered from Pigeon Lake’s northeastern shores.

RCMP investigate possible drowning at Pigeon Lake; Man and woman found dead on shore

Bodies recovered from Pigeon Lake’s northeastern shores.

134 new cases of COVID-19 on Friday

First day over 100 cases since July 31

Canada to match donations to Lebanon relief

Canada is directing all of its aid for this crisis directly to humanitarian organizations, not the Lebanese government

Rent-relief program becomes new front in fight between Liberals, opposition

Opposition trying to draw parallels between decision to have Canada Mortgage and Housing Corp. run program and the WE controversy

Ottawa sets minimum unemployment rate at 13.1% for EI calculation

Statistics Canada says the unemployment rate was 10.9 per cent in July

Oilers 50/50 raffle delayed as team resolves errors, offers refunds

Alberta fans who want to void any ticket purchases will have until noon Thursday

Sylvan Lake couple donates $850,000 to AACS

The doantion will be put towards a new X-Ray machine for the facility

Who can dismiss the Governor General? A look at protocols and possibilities

The Governor General is appointed by the Queen, on the advice of the prime minister

Second phase of NHL draft lottery set for Monday

Each club eliminated from qualifying round has a 12.5 per cent shot at the No. 1 pick

Collapse of Nunavut ice shelf ‘like losing a good friend:’ glaciologist

The ice shelf on the northwestern edge of Ellesmere Island has shrunk 43 per cent

13-year-old charged in death of boy, 10 in Maskwacis

The RCMP Major Crimes Unit have laid a manslaughter charge against a 13-year-old boy from Maskwacis.

Most Read