Last month we learned that factors had stopped approving Barneys’ spring orders until the store had provided certain information on financing to prove that they, well, had it. One such factor sent a letter to vendors and designers yesterday explaining they are being “led to believe [Barneys owner] Istithmar is going to support Barneys. But until we see actual details, projections and have an opportunity to review and discuss, we are holding/declining orders.” Funny he says that, because Istithmar chief David Jackson has called some of their requests “unwarranted.”
The letter added, “It makes sense that they will try to stabilize the business and get through this difficult year in hopes of selling the company at some future point.” (Jackson recently denied that the chain was, in fact, for sale, following renewed speculation that Istithmar was trying to get rid of it.) Barneys owes the factors millions, according to WWD, which is holding up some shipments, though the store appears to be stocked. Designers are getting orders for fall in addition to spring orders to ship now, but factors are telling them not to ship anything until they feel “comfortable” with the answers from Barneys, even if the goods are in boxes and ready to go.
Barneys could be slow to deliver the information because a recent meeting with its banks was pushed back. Or they could just be screwed and scrambling for financing. American Apparel can warm a seat for them in that club.