In January 2010, the Bankruptcy Court for the Southern District of New York confirmed the plan of reorganization of Crabtree & Evelyn, a company that provides men and women with bath and body, and skin care products.
Crabtree & Evelyn filed bankruptcy around July 1, 2009 as reported by Rachel Feintzeig of The Wall Street Journal “Crabtree & Evelyn Files for Bankruptcy Protection”. Crabtree & Evelyn, retailer of body and home products, was among the may U.S. retailers who filed Chapter 11 bankruptcy protection since the financial breakdown in 2008. Many retailers who file bankruptcy do not reorganize successfully because consumers tend to stop spending during a recession when they are unemployed or fear unemployment, when the credit market declines, and when housing is difficult to purchase. Crabtree & Evelyn does not sell necessities; rather high end luxury cleaning products that may not offer tested medical results. For instance, there is no scientific backing that its soaps prevent or decrease acne. The company locates most of its stores in malls, where consumer spending tends to be discretionary.
The company that sells hand care creams closed on a $26.3 million exit loan from its parent company, Kuala Lumpur Kepong Berhad, a Malaysian company that owns palm and rubber tree plantations. This debt provided cash to make payments under the bankruptcy reorganization plan and fund the company’s strategic business plan. The company with stores globally resized its retail footprint by renegotiating its leases and closing 35 of its locations to concentrate on the remaining 91 retail locations and an e-commerce platform, at www.crabtree-evelyn.com. The online store offers free shipping for orders that are above $65, and buy one get one 50% sales.
At the time it filed bankruptcy, the company employed around 950 people. After the bankruptcy filing, Crabtree & Evelyn introduced new products as part of its execution on its reorganization plan, such as the Citron Honey & Coriander Hand Therapy Collection, naturally based hand creams, age defying and exfoliating treatments, and cleansers. There are products selling for around $5 – $15. The company also uses Twitter to advertise. The company continues to honor gift cards and returns.
There are several Crabtree & Evelyn locations in New York: 30 Rockefeller Plz # Ee, New York, NY; 10 Columbus Cir # 109, New York, NY; 520 Madison Avenue, New York, NY. Each location markets itself as a place that soothes the mind, soul, and body.