Nine Ottawa shoe stores expected to close in Payless bankruptcy

Nine Ottawa stores belonging to Payless ShoeSource are expected to close in the next few months after the company filed for bankruptcy in the United States.

Payless has 248 stores across Canada and 2,500 in North America.

The company said in a news release after the filing on Monday that it expects these outlets will begin shutting down at the end of March, although it intends for “many stores” to remain open through the end of May.

“Over the years, we have had highs and lows amid significant operational and market challenges,” the company said in a recent letter to its customers. “Despite our best efforts to address the rapidly changing retail environment, we — like many other retailers — have been forced to face very difficult choices.”

Payless describes how its goal of maintaining its brand while continuing to reach customers around the world caused it to file for an earlier bankruptcy in April 2017.

This time, mounting debts and a challenging retail market are the source of the company’s troubles, and it is costing 2,400 Canadians their jobs. However, the retailer’s stores abroad, including in Latin America, the Middle East and Asia, will continue to operate.

In its news release, Payless said that the company is “seeking customary initial relief from the U.S. Bankruptcy Court and Canadian Court.” It said these relief methods include getting authorization to support its operations during the bankruptcy and to continue paying its employees’ wages, along with maintaining health-care benefits.

It also said it is seeking authorization to allow customer gift cards and store credits to be redeemed until March 11. Returns and exchanges of certain non-final sale purchases made before Feb. 17 of this year will be possible until March 1.

Lauren Jeffords, senior director of corporate communications at Payless, was unable to comment on the impact the closure will have on its Ottawa employees.