Payless to close in US, but promises to remain open in Jamaica

Business reporter

Wednesday, February 20, 2019

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PAYLESS ShoeSource may be shuttering business in the United States and Puerto Rico, but the retail giant yesterday sought to reassure its Latin American and Caribbean customers that it has no intention of closing business in the region through its announcement to open new stores across the region later this year.

Payless, which has some 420 stores across 20 countries in Central and South America and the Caribbean said it not only plans on opening new stores in countries where it already has a presence, but is also exploring markets to roll out the Payless Shoe Source online platform.

The company successfully launched its e-commerce platform in Costa Rica and Colombia in 2018.

“We are proud of our accomplishments in Latin America and the Caribbean, including our leading market share and strong store footprint,” commented Mario Zarazua, chief financial officer for Payless, in a statement obtained by the Jamaica Observer yesterday.

“We look forward to building upon our success in these regions by adding new stores and a broader online reach. While Payless' North American stores have faced difficulty, due to a challenging retail environment, our thriving businesses in Latin America and the Caribbean have considerable profitable growth potential and remain an integral part of our long-term strategy,” Zarazua continued.

According to the statement, Payless currently holds the number one or two market positions in each of its Latin American and Caribbean markets as customers across these regions look to Payless for on-trend footwear and accessories at great prices for everyday and special occasions.

Locally, the shoe store has also carved out a niche from its ability to shelf up to size 14 shoes for men and 13.5 for women in a variety of styles and colours.

The company noted that it has voluntarily filed for relief under Chapter 11 of the Bankruptcy Code in the US Bankruptcy Court for the Eastern District of Missouri. It added that certain Payless Canadian subsidiaries are also seeking protection pursuant to the Companies' Creditors Arrangement Act (CCAA) in the Ontario Superior Court of Justice (Commercial List).

This marks the second time that the 63-year old discount shoe retailer has filed for Chapter 11 bankruptcy protection, less than two years after it emerged from its previous bankruptcy.

Payless, however, reiterated that its retail operations outside of North America, including its company-owned stores in Latin America and the Caribbean, are separate legal entities and are not included in the Chapter 11 or CCAA filings.

“The Payless liquidation sales in the US and Puerto Rico do not, and will not, affect the company's stores in Latin America and the Caribbean and franchisee stores, which will continue operating business as usual in every respect,” the statement read.

Founded in 1956, today Payless serves millions of customers through its extensive global network spanning 36 countries worldwide. Payless has 420 stores in Latin America, the Caribbean, the US Virgin Islands, Guam and Saipan in the Northern Mariana Islands, as well as 370 international franchisee stores across the Middle East, India, Indonesia, Indochina, Philippines, and Africa.

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