May 28, 2009.by: Adrianne Pasquarelli
Retailer struggled to reduce expenses since 2001.
Retailer the Door Store is opening its own doors for bankruptcy lawyers. The Secaucus, N.J.-based mid-market furniture shop filed for Chapter 11 bankruptcy protection late Wednesday under the corporate name of Furniture In-Parts Corp. Citing poor economic conditions as the reason for the filing, the company listed assets between $1 million and $10 million, along with liabilities of the same amount.
With five New York City showrooms and four locations in the surrounding areas of Long Island, Westchester and New Jersey, the Door Store has become a New York institution for trendy yet affordable furniture since its founding in 1953 by two sisters from Ohio.
The company said that it has been trying to reduce overhead expenses since September of 2001, during the last downturn. It had been profitable through September of 2008, but sales began to dip drastically after that. Though the Door Store was able to re-negotiate seven of its leases, market conditions still forced the retailer to seek bankruptcy protection from creditors in order to reorganize.
“All of our focus moving forward will be to fulfill customer’s orders and provide the products that our customers have come to expect from Door Store. As for now, it is business as usual, but better,” said the company in a statement.
According to the bankruptcy filing, the company estimates its current inventory to be near $1.7 million. Its showroom spaces average near 6,000 square feet, and, even with renegotiated leases, could still be costly to maintain when shoppers aren’t buying, according to retail experts.
“I’m sure their rents were pretty high,” said Michael Appel, managing director of Quest Turnaround Advisors. “When the volume goes down so dramatically, like it has, it’s pretty hard to operate a business.”
The furniture and home goods industry has been one of the hardest hit by the recession as many shoppers put off unnecessary purchases. Earlier this year, local home goods and jewelry purveyor Fortunoff liquidated, and mattress seller Dial-a-Mattress, which filed for bankruptcy in March, was eventually acquired by competitor Sleepy’s. In addition, luxury furniture retailer Maurice Villency announced last month it would close its two-level, 26,000-square-foot location on Third Avenue and East 57th Street, a spot just one block south of the Door Store’s Upper East Side location at 969 Third Ave. It is not yet known if the Door Store will close its Third Avenue space, which would create even more vacancies along the corridor.
