JHVEPhoto/Depositphotos.com
June 27, 2025
Will Claire’s Find an Interested Buyer Despite Tariffs and Competitors?
Claire’s is a household name in the fashion accessories market, especially among millennials who remember getting their first ear piercings there during the retailer’s heyday in the 1990s and 2000s.
Now, however, the company has fallen on hard times, according to FOX Business. Claire’s emerged from Chapter 11 bankruptcy in 2018 under the control of Elliott Management and Monarch Alternative Capital, and while some earnings reports (including a FY 2022 report via Glossy.co showing a 53% year-over-year sales increase) have pointed to signs of a turnaround, challenges remain.
The latest headline: Claire’s Stores Inc. is eying a possible sale due to the combined pressures of President Donald Trump’s ongoing tariffs as well as stiff competition coming from low-cost e-commerce retailers such as Amazon, Temu, and SHEIN.
Claire’s Has ‘Struggled To Stay Relevant,’ Consultant Says
One major issue facing Claire’s, fundamentally, is an inability to maintain relevancy in an increasingly crowded market. While also pointing to inflation-driven price hikes — hikes exacerbated by Trump’s tariffs — and import costs at large, Julie Palmer, partner at financial consultancy Begbies Traynor, weighed in.
“Claire’s low-price offering is clearly not strong enough to win over its core customers — teens and young adults — as they now have access to a vast array of affordable and convenient products online through platforms like Amazon and Temu,” Palmer said, per The Mirror.
“So, with fewer reasons for its customers to visit their stores, the retailer has struggled to stay relevant,” she added.
The battle for relevancy may be vital for Claire’s, or whoever might end up purchasing it. While the Gen Xers and millennials who fueled its success in earlier decades might hold some degree of nostalgia for the brand, a plethora of options have since opened up a much larger breadth of choice in the fashion accessories market.
Claire’s Is Also Facing $500 Million Loan Due End of Next Year, in Conjunction With Curbed Consumer Spending
Beyond those headwinds, Claire’s has a pair of other problems to contend with as it allegedly considers a sale.
First, it is staring down a ~$500 million loan due in December of 2026. Rumblings of a sale could indicate that former creditors Elliott and Monarch, currently holding the reins of the retailer, could be looking to make an exit sooner rather than later.
Second: American consumers have sharply decreased their discretionary spend, either in anticipation of — or due to — concerns around the macroeconomic situation, whether those concerns hinge around the job market, tariffs, or inflation.
Given the confluence of all of the above, the question of whether or not Claire’s can attract a buyer interested in either revitalizing the brand or in harvesting its assets for what can be salvaged remains in play.
Discussion Questions
Is Claire’s likely to find an interested buyer? Why or why not?
Will said buyer want to continue a turnaround or pick and choose elements to spin off?
What, if anything, can Claire’s do to revitalize interest in its brand overall amongst the competitive field? Is there any value in trading on its nostalgic appeal?
Poll
Loading …BrainTrust
Gary Sankary
Retail Industry Strategy, Esri
Mark Ryski
Founder, CEO & Author, HeadCount Corporation
David Biernbaum
Founder & President, David Biernbaum & Associates LLC
Recent Discussions
More Discussions
Which Tech Will Solve In-Store Inventory Woes?
Three major tech lineups are looking to solve retail inventory problems. Which is most suited?Will Ford’s New Retail Experience Deliver Results?
Ford is revamping its global dealership model, in terms of physical space and other aspects. Will…Will Target’s Rebalancing Act Solve its ‘Sloppier’ Stores Problem?
Target is making an operational move to take fulfillment duties away from certain stores. Will this…
I am sure there are buyers out there, the question is what price they are willing to offer. With high debt levels and imminent loan payments, Clare’s needs a buyer that is able to inject cash or sustain losses. That necessarily reduces the value of the business. It may also require the business to be sold off piecemeal.
Gee you’re already bankrupt, and you get acquired by a well-known activist investor...who could have possibly seen this coming? That having been said, I believe they’ll find a buyer…it seems like every company, however hopeless, does. It may be someone with more dollars than smarts, but that wasn’t the question. And judging by the picture, I’m hoping it will be someone who has monochromia!
Debt, tariffs, competition: Claire’s perfect storm. Private equity loaded Claire’s with debt, tariffs are squeezing margins, and consumer spending is shifting – but the underlying brand and distribution assets could be valuable to someone with a different vision and a cleaner balance sheet. The question isn’t whether Claire’s current model works (it doesn’t), but whether someone can reimagine what Claire’s could become.
I put less emphasis on online competition, as Claire’s average unit MSRP is under $20 with much under $10 – online sellers can’t make profit with such low price points, even if your inventory cost was virtually zero! It’s impulse selling to tweens and teens; experiential retail with the entertainment value provided by your friends you came with as you browse and make decisions – so you need to be where those people are. There are three Claire’s in the Mall of America last I counted because the traffic supports it. Any new buyer needs to understand that demographic and act fast to be wherever they choose to congregate.
With over 1,300 US locations and $1.3B in revenue, the chain still has legs. With these numbers, someone will acquire them. However, notwithstanding good progress post-pandemic, they face numerous challenges and it will take some reimagining in order to keep moving forward. Not easy to do when you’re not profitable.
I have serious doubts that Claire’s will find a buyer due to the troublesome financials involved, declining relevance, and its declining marketplace. More likely, if Clair’s doesn’t scale down significantly, or simply go out of business, it might become an all-online type of business, similar to Bed, Bath, and Beyond situation and circumstances.
There is some value here, but the parts are worth more than the whole at this point, and any buyer will most likely make a purchase with that in mind.
Tricky question indeed. I do believe there will be a buyer, however, the sale price will have to be a bargain. New owners will have to inject capital, reinforce infrastructure, and negotiate new trade deals. Not for the faint of heart.
No, Claire’s will not find a buyer as it is. Too many stores, restricted supply chains, old business model, and increased competition all spell doom for Claires. The sharks are circling and they smell blood in the water!
I get paid over 220 Dollars per hour working from home with 2 kids at home. i never thought i’d be able to do it but my best friend earns over 15k a month doing this and she convinced me to try. it was all true and has totally changed my life. This is what I do, check it out by Visiting Following Website
HERE—————⊃⫸ Www.Work44.Com