The vitamin chain was hit hard by debt and COVID-19.
Add GNC to the list of retailers too fragile to withstand the stress on their business from the COVID-19 pandemic.
GNC’s parent company, GNC Holdings Inc., filed for Chapter 11 bankruptcy protection late Tuesday, and the health and wellness retailer said it plans to close “at least 800 to 1,200 stores,” or approximately a quarter of its North American fleet. GNC was slammed by yearslong sales declines that made it impossible to meet enormous debt obligations coming due this year.
The company joins the ranks of J.C. Penney, Neiman Marcus, J.Crew, Stage Stores, and Tuesday Morning—debt-laden retailers filing for bankruptcy protection after being pushed over the edge by weeks of closed stores during the pandemic.
While GNC stores are small in size, typically between 1,000 and 2,000 square feet, there are too many of them in relation to the company’s declining revenues. In 2019, GNC net sales were $2.1 billion, down from $2.7 billion four years earlier. Much of that sales decrease has come as consumers have increasingly turned to purchasing vitamins and other nutritional products online. The bankruptcy gives GNC the opportunity to quickly shed stores, many of which are in malls where shopper visits have long been in decline.