Gump’s, the iconic 157-year-old San Francisco department store that specializes in jewelry, home furnishing, and accessories, filed for Chapter 11 on Aug. 3 in Nevada bankruptcy court.
The store, a longtime icon of the city’s Union Square shopping district, still hopes for a buyer to purchase it as a going concern or possibly scoop up its intellectual property or e-commerce platform, says William Noall, a member of business restructuring group of Garman Turner Gordon.
Yet its home page is already trumpeting a “going out of business sale,” and Gordon Brothers and Hilco have been enlisted to liquidate its merchandise.
Gump’s, like other department stores, has “faced an increasingly challenging retail environment,” while struggling with high operating costs and a heavy debt load, according to a declaration by Tony Lopez, its chief financial and chief operating officer. Despite some success pivoting to catalog and e-commerce sales—which now account for 76 percent of its business—Gump’s incurred a net loss of $5.7 million in 2017, from $59.8 million in revenue. It also lost $5 million in 2016, when sales totaled $57.6 million.
In recent months, the company has aggressively sought a buyer or new investor, but all offers were contingent upon the company raising additional capital, Lopez said.
Gump’s was founded in 1861 as a frame and mirror shop, but it soon switched to selling luxury items to the newly minted millionaires of the California Gold rush. It became known for carrying rare, expensive items purchased abroad—a positioning it maintains to this day.
“Because Gump’s specializes in unique, one-of-a-kind items, it does not have any real direct competitors,” wrote Lopez.
Among its signature items were jade and freshwater pearls, though Gump’s has in recent years broadened its selection to include lower-priced jewelry, Noall told the San Francisco Chronicle. And while it’s faced calls to freshen up its inventory, it has lacked the capital to do that, he said.
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