The Real Reason Charlotte Russe Filed For Bankruptcy

We may have assumed cheap chic entered the U.S. by way of H&M, but before this bargain fashion chain made a splash back in 2000, there was Charlotte Russe (via AP). The trendy fashion retailer opened its doors in Carlsbad, California in 1975. From the start, it was a go-to place for teens and women in their 20s who were on the lookout for trendy, yet budget-conscious clothing, accessories, and shoes, and best known for its stock of Refuge jeans (via Web Archive). At its height, Charlotte Russe had over 500 stores across the country and Puerto Rico, and for a 1990s mall rat, the store — which was named after a French dessert — was an institution, the same way Sam Goody's was for music, or The Sharper Image was for gawking at the latest tech gear (via Good Housekeeping).

Given Charlotte Russe's popularity, we might have been forgiven for thinking it would survive the retail apocalypse that claimed so many other brands like Contempo Casuals and Wet Seal... but we were wrong. 

Charlotte Russe first filed for bankruptcy in February 2019 and in a report, CNN says the brand was brought to its knees by a combination of poor sales and too much debt. Fast fashion retailers need to stay ahead of styles and trends, and Charlotte Russe says it wasn't able to connect with its original core market of teens and young adults. It also chose to move away from trendy clothes, and began selling more fashion basics, which the company says kept it from rejuvenating its online business. 

Charlotte Russe came roaring back less than two months later, in April, announcing on Twitter that the brand was "planning a brand new online shopping experience, as well as re-opening 100 retail locations across the US." It emerged that  Charlotte Russe had been purchased by the Toronto-based YM Group in March 2019, weeks after it filed for bankruptcy. YM owns the brand to this day.