Teen retailer Wet Seal closing 8 stores in Pa. including one in Springfield
California-based teen retailer Wet Seal is shutting all 171 of its stores nationally, including the eight in Pennsylvania.
The Pennsylvania stores include a location at Springfield Mall in Delaware County, which is co-owned by Pennsylvania Real Estate Investment Trust and Simon Property Group.
There are also Wet Seals at Lehigh Valley, Wyoming Valley and Berkshire malls in eastern Pennsylvania. The four other stores are in the western part of the state.
There are 3 Wet Seal stores slated to close in New Jersey, including the one at Freehold Raceway Mall.
The chain focuses on clothing and accessories for young women and exuded "California cool" in its prime. But it is the latest retailer to fall thanks to a battering from digital shopping and declining in-store sales.
"Unfortunately, the company was unable to obtain the necessary capital or identify a strategic partner, and was recently informed that it will receive no further financing for its operations," Michelle Stocker, Wet Seal's vice president and general counsel, said in a letter to employees.
Online shopping is another factor, spreading collateral damage to department stores: Macy's Inc. is closing 68 more stores this year and Sears Holding Corp. is shutting 150 more Sears and Kmarts.
Last month, another women's apparel retailer, The Limited, announced it was closing all 250 of its brick-mortar-stores so it can focus exclusively on online sales. It has since filed for bankruptcy protection.
Retail analysts say teen apparel stores, like Wet Seal, are particularly vulnerable since they cater to among the most tech savvy shoppers out there.
"Retailers, like Wet Seal and The Limited, are in the worst sector of retail, which is apparel," said New York based retail consultant Howard Davidowitz. "Not only that, they are in bad malls, are facing fierce competition from fast fashion retailers, and are all saddled with a ton of debt by having private equity sponsors.
"In addition to all those negatives, the priorities of teens have changed," he said. "They aren't focused on buying jeans and sweaters. Their priority is their iPhone, iPad and electronics. That's what they're into now."
Wet Seal began as Lorne’s in 1962 in Newport Beach, Calif. It was founded by Lorne Huycke.
In 1990, the company name was changed to Wet Seal. Five years later, the company acquired Contempo Casuals from Neiman Marcus. Those stores were renamed Wet Seal in 2001.
It cruised along in its first decade, but by 2014, it was forced to sell some two-thirds of its stores as fierce competition from the likes of trendy, fast-fashion retailers that churn mass volumes daily, such as H&M and Forever 21, cut deep into its market share.
By January 2015, Wet Seal filed for bankruptcy. It was acquired by private-equity firm Versa Capital Management for $7.5 million in cash and $20 million debtor-in-possession financing.
But it never regained its footing and online's relentless rise tipped it over the edge.
A sales clerk at the Wet Seal at Springfiled Mall on Thursday confirmed its immenent closure.
"We haven't gotten a date yet," she said, asking her name not be used since she wasn't authorized to speak to reporters. "They told us whenever we're out of inventory. But it's still pretty full in here."
