The bankruptcy of a shoe company in the US has shed light on creditors, with a significant portion of the debt owed to freight and logistics companies, totaling 41%.
Shoes for Crews, a manufacturer of non-slip workwear shoes, filed for Chapter 11 bankruptcy on April 1st. The company cited challenges such as increased competition from online retailers, the impact of Covid-19 on the hospitality industry, and inflationary pressures on costs as factors contributing to their financial struggles. The company’s customer base was heavily reliant on the restaurant industry, with 95 of the top 100 US restaurant brands being clients.
The creditor list provides further insights, with Ceva Logistics being the largest creditor owed $8.2 million. Other significant creditors include Vandegrift, VCW Logistics, Purolator, FedEx, and Project44. Freight and logistics operators account for the majority of the debt at 41%, followed by manufacturers in Hong Kong at another 41%, with the remaining debts owed to various other service providers.
The financial difficulties faced by Shoes for Crews were attributed to the shift towards online retail shopping, which increased competition from companies with online presence. This situation highlights the challenges faced by traditional retailers in the age of e-commerce, as well as the significant costs associated with freight and logistics in the overall manufacturing process.
