Claire’s Faces Second Bankruptcy Amid Rising Pressures

Claire’s, a mall-based tween accessories retailer known for ear piercings, is considering a second U.S. bankruptcy due to high debt, weak demand, increased tariffs on Chinese imports, and rising competition from fast-fashion e-tailers like Shein and Temu. The company has been owned by Elliott Management and Monarch Alternative Capital since its 2018 Chapter 11 exit and has struggled to regain financial stability, shelving its IPO plans in 2023 and recently deferring debt interest payments to conserve cash. Claire’s operates nearly 2,000 stores worldwide and has tried to reinvent itself through shop-in-shops at major retailers and digital outreach to Gen Z and Gen Alpha. Houlihan Lokey is leading the potential sale of all or parts of the business, with European assets drawing particular interest. Experts say Claire’s small store footprint may minimize mall closure impacts, but losing its piercing services could affect foot traffic patterns. The situation underscores broader existential threats facing traditional mall retailers.