April 5 (UPI) -- Payless ShoeSource Inc. has filed for bankruptcy and said it has a restructuring plan calling for the immediate closure of 400 stores.
The company, founded in 1956 with headquarters in Topeka, Kan., did not specify which of its 4,400 stores in over 30 countries it will close, but said in a statement Tuesday that additional closures could come as it works "to aggressively manage the remaining real estate portfolio."
It added, though, that through Chapter 11 bankruptcy it will attempt to reduce its debt load and increase its e-commerce presence. Moody's Investors Services downgraded the company's outlook in February, noting a $520 million loan due in 2021 and a $145 million loan due in 2022.
It is the 10th major retailer to file for Chapter 11 bankruptcy since the start of the year.
Analysts said the retail market in the United States is oversaturated and that a rise in the U.S. urban population of 12.1 percent from 2000 to 2010 suggests that stores such as Payless Shoe Source, with its heavy reliance on suburban malls and shopping plazas, may be in incorrect locations.
"We're just over-stored. That's something that's plaguing a mall, a strip center and a stand-alone location," Deborah Rieger-Paganis of the AlixPartners consulting firm, told the Washington Post.
Online shopping has also been blamed for the decline in retail shopping.