The rise and fall of Barneys, the iconic New York luxury department store teetering on the brink of collapse
- Barneys New York is in the process of finding a buyer to prevent liquidation after filing for Chapter 11 bankruptcy in August. As part of the bankruptcy announcement, Barneys said it would close 15 of its 22 stores.
- Though the luxury department store is a favorite among celebrities and fashionistas, it has a history of financial strife and leadership challenges, beginning with its first bankruptcy in 1998.
- We took a closer look at the rise and fall of Barneys over the years.
- Visit Business Insider's homepage for more stories.
Barneys New York is awaiting an uncertain fate after nearly a century of selling luxury apparel to Manhattan's elite.
The luxury department store - long heralded as a beacon of high style in New York City and a favorite among celebrities and fashionistas - is currently in the process of finding a buyer to prevent liquidation after filing for Chapter 11 bankruptcy in August. The decision came after several quarters of sales woes thanks to increased competition from e-commerce, declining foot traffic, and skyrocketing rent prices.
As part of the bankruptcy announcement, Barneys is shuttering 15 of its 22 stores, though it plans to retain its iconic Manhattan flagship location. While Barneys' downfall may seem like a surprise to some, this isn't the first time the company was on the brink of collapse - the department store also suffered a near fatal blow in the 1990s.
Though Barneys isn't alone in its fight to stave off the retail apocalypse, the brand has larger reputational issues on its hands, according to New York Times fashion critic Vanessa Friedman. Somewhere along the way, Barneys went from aspirational to punishingly elitist - it failed to adapt to the modern shopper, and in turn consumer sentiment soured.
"[Barneys] was also unabashedly elitist, proudly exclusionary - you got it or you didn't, and if you didn't, that was your problem, not theirs - and imbued with an arrogance that, at a certain point, began to chafe," Friedman wrote after the bankruptcy announcement.
Here's a closer look at the rise and fall of Barneys New York.
Barneys was started by Barney Pressman in New York City in 1923.
For the next three decades, Barneys remained a go-to destination for menswear. It wasn't until Pressman's son Fred inherited the business that the store made its transition into luxury retail.
Fred recruited the help of fashion designers Hubert de Givenchy and Pierre Cardin to infuse the store with European luxury fashion and establish Barneys as a destination for men's designer clothing.
By the 1970s, Barneys was a full-fledged high-end retailer. Hoping to garner more business, Fred's sons Gene and Bob took on the task of bringing women's designer clothing to the store.
As Barneys established its dominance in the luxury fashion market, it helped launch the career of designers like Giorgio Armani. In 1976, the store officially debuted the Armani brand.
In the 1980s, Barneys commissioned Ivan Chermayeff to create an official logo, which the store still uses today.
In 1986, Barneys ran a series of high-fashion magazine ads featuring then-budding supermodels, Linda Evangelista, Naomi Campbell, and Christy Turlington.
That same year, Barneys opened its first official women's store, to significant fanfare.
Also in 1986, Barneys hired Simon Doonan, the brainchild of the store's iconic window displays. He remains creative-ambassador-at-large today.
By the 1990s, Barneys was ready for global expansion and the retailer began opening stores across the country, as well as in Japan. In 1993, Barney's opened its lavish 230,000-square-foot flagship location on Madison Avenue.
However, the 1990s also marked the beginning of a period of financial strife for Barneys.
Around this time, Barneys also opened its first physical Warehouse location, a sign that the company had finally acquiesced to growing consumer demand for bargain goods.
By the mid-1990s, several vendors began to refuse to sell to Barneys due to late payments. The Pressman brothers came under immense pressure from their Japanese financial partner, Isetan, Co, to pay their debts.
Though the Pressman brothers continued to hold soirees and celebrate the store, behind the scenes the business was increasingly struggling.
As part of the bankruptcy proceedings, Isetan took ownership of the three largest Barneys locations, in New York, Chicago, and Beverly Hills.
As Barneys worked to regain its financial footing, it made several high-profile appearances in hit shows like "Sex and the City" and "Will and Grace."
It also went through a period of ownership and leadership transitions.
In September 2010 Mark Lee was appointed CEO, and he got to work to try to usher in a new era for Barneys.
Under Lee's tutelage, Barneys began experimenting with new retail concepts and partnerships, including teaming with Lady Gaga on the highly anticipated "Gaga's Workshop."
Despite these flashy partnerships, Barneys struggled with its identify as consumers not only began to sour on its elite image, but also to shop increasing online.
Still, "Barneys has cultivated a vaunted status as the place to see and be seen," wrote New York Times writer Gregory Schmidt.
In 2017, Daniella Vitale took over as CEO after first spearheading significant growth within Barneys' e-commerce sector.
Barneys continued to falter as a result of lost foot traffic, skyrocketing rent, and competition from e-commerce. In August 2019, the luxury retailer filed for Chapter 11 bankruptcy.
Barneys is currently in the process of finding a buyer, and it has until October 24 before it will be required to begin liquidation, according to CNBC.
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