Unfortunately, yes. Matilda Jane Clothing is going out of business.
After 2019, its revenue dropped significantly, and it had to sell most of its assets to keep the brand alive. However, it appears that Matilda Jane will dissolve.
In 2005, Denise DeMarchis founded Matilda Jane and generated massive profits year after year.
Read the following to learn why this clothing brand is struggling in 2023 to stay in business.
Why did Matilda Jane terminate relations with trunk keepers?
Matilda Jane Clothing cut off contracts with trunk keepers in December 2022. And the reason behind the calling off of the relationship with trunk keepers is that the company is facing severe losses.
Before going any further into the article, you should know who is a trunk keeper. Generally, trunk keepers are owners or entrepreneurs of their boutique businesses. They buy clothing from companies and sell them in their stores.
Since its establishment in 2005, Matilda Jane has supplied clothing to boutique houses. But everything changed when the company started facing losses in 2019.
The sudden sales drop of Matilda Jane in 2019 led the brand to sell its assets to remain its business on track. But the strategy did not work.
Thus, Matilda Jane had to take the extreme decision of cutting off relations with local trunk keepers. The brand may be wrapping up its business from the retailers’ side as the company knows its inhabitable dissolution.
Why is Matilda Jane going out of business?
Matilda Jane’s parent company, Gymboree, has made possible wrong decisions that regrettably backfired on its subsidiary brand.
As a result, the company encountered some severe sales drop after 2018.
A company without its end assets is nothing but a goner. Let’s learn the most notable decisions that have sunk Matilda Jane at the bottom.
In 2019, Gymboree filed for Chapter 11 bankruptcy. As a result, the impact directly hit Matilda Jane Clothing.
As Matilda Jane’s parent company filed for it, it had to sell and auction most of its assets to support Gymboree.
Due to the shortage of assets, Matilda Jane could not produce its targeted amount of clothing. And according to the supply-demand relation, if you cannot supply, your products’ price goes up. As a result, you lose customers.
The same thing happened to Matilda Jane. As the company could not meet its consumers’ demands, it started losing them. The consequence was not good. Its revenue was cut in half within months.
What will happen to Matilda Jane?
After cutting off the relations with trunk keepers in December 2022, Matilda Jane has released a memo. There, the company announced that it would soon be winding down the business.
Though soon Matilda Jane will go out of business, some rumors are floating all over the internet. A Texas-based clothing line, Cheeky Plum, will merge with Matilda Jane in fall 2023.
When Matilda Jane is merged with Cheeky Plum, it can act as a co-brand instead of a subsidiary brand of that clothing line. But this is all a rumor for now. Let’s hope for the best for this clothing brand.
Some say Cabi, a Californian clothing company, will purchase Matilda Jane Clothing. However, this information is not as reliable as Cheek Plum’s.
However, we can only say that Matilda Jane will soon dissolve as a brand, which has turned into an inhabitable fact.
Why is Matilda Jane so popular?
Matilda Jane is popular for its unique workings and the arts in its clothing. The cute, sweet, and gentle artworks have caught every woman’s eye in the United States.
It is not like Matilda Jane’s sales dropped because people do not like it. It is due to the production shortage of the company. But the popularity of this company’s clothing is on another level.
It would be nice if this brand survives the difficult time it is facing now.
Sources:
- https://www.konaequity.com/company/matilda-jane-clothing-4393880797/ – Matilda Jane Clothing annual revenue statistics (Kona Equity)
- https://www.21alivenews.com/2022/12/08/trunk-keeper-matilda-jane-is-closing/ – Matilda Jane ending relationships with trunk keepers (21 Alive News)
- https://www.directsellingnews.com/matilda-jane-clothing-announces-it-is-winding-down-its-business/ – Matilda Jane folding up its business (Direct Selling News)
