Popular fashion chain files Chapter 11 bankruptcy, closes stores
Clothing retailers often blame a long list of economic problems for their financial distress. Among the problems are rising costs of products and labor, driven by inflation and tariffs; consumers’ changing attitudes toward shopping at brick-and-mortar retailers; overmarket lease rates; ...
Popular fashion chain files Chapter 11 bankruptcy, closes stores
Overview
Clothing retailers often blame a long list of economic problems for their financial distress.
Among the problems are rising costs of products and labor, driven by inflation and tariffs; consumers’ changing attitudes toward shopping at brick-and-mortar retailers; overmarket lease rates; and rising interest rates on debt obligations for closing stores and filing for bankruptcy.
Unsustainable overhead is a common economic issue that forces retailers, such as apparel chains, to close locations and in some cases file for bankruptcy. That was what forced women's apparel retail chain Morning Lavender to close two stores and file for bankruptcy.
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Morning Lavender files for bankruptcy
Stylish women's fashion retailer Morning Lavender LLC filed for Chapter 11 bankruptcy protection shortly after closing two of its retail locations to focus on its flagship Orange County, Calif., store, cafe, and e-commerce website.
The Tustin, Calif.-based retailer filed its Subchapter V petition in the U.S. Bankruptcy Court for the Central District of California on June 16, listing $100,000 to $500,000 in assets and $1 million to $10 million in debt, according to court papers. The company did not give a specific reason for filing for bankruptcy.
The Tustin store remains open, and the company's online e-commerce continues.
Morning Lavender's largest creditors include Bank of America, owed over $412,000; Chase Bank, owed over $334,000; Shopify, owed over $284,000; and American Express, owed over $89,000.
Retail chain closes location
The retailer closed its Solana Beach, Calif., location near San Diego on March 29, 2026, after suffering financial difficulties.
"This is probably the hardest video I've ever had to make," Kim Le Pham, owner of Morning Lavender, said in a Facebook video. "Today I have unfortunately a hard announcement to make. Starting March 29, we will be closing our Solana Beach location. This is a decision we have not made lightly, of course."
Details
Morning Lavender operated in Solana Beach for 14 months, but was unable to meet its projections, as construction setbacks and a series of bad decisions led to financial difficulties, according to the video.
Another store shuts down
The retail chain subsequently closed its location at the eight-year-old Pacific City shopping center on Huntington Beach, Calif.
Morning Lavender did not officially announce the closing on social media or its website, but the store, which it opened on Oct. 15, 2022, is no longer listed on its website or on Pacific City's center directory.
The Huntington Beach store at Pacific City is reported as closed on Yelp.
Large retailers stave off distress
Larger retailers are better able to avoid high-risk situations, such as bankruptcy, than smaller companies, according to Rapid Ratings Executive Chairman James Gellert.
"What we're seeing in retail is consistent with a lot of other industries," Gellert said, according to Rapid Ratings' website.
"A larger-sized company is able to plod through or even improve during more volatile economic times, where smaller companies are being disproportionately hit," Gellert said.
Apparel store includes cafe
Morning Lavender Boutique and Cafe was created by wedding photographer and fashion blogger Kim Le Pham and opened for business in 2018 in Tustin, featuring dresses, tops, bottoms, and accessories.
The cafe in the Tustin Morning Lavender offers espresso drinks, teas, and lite bites, according to its website. It also features Afternoon Tea Service by reservation on Fridays, Saturdays and Sundays, priced at $44 for adults and $33 for children age 7 to 13.
The Afternoon Tea menu includes finger sandwiches, scones, petite desserts, and a pot of fine tea.
Morning Lavender store locations:
- Flagship: 330 El Camino Real, Tustin, Calif.
- Pacific City Center, 21034 Pacific Coast Highway, Suite 108, Huntington Beach, Calif. (Closed.)
- 329 South Highway 101, Suite 120, Solana Beach, Calif. (Closed.)
- Source: Morning Lavender
Related: 52-year-old steakhouse chain has closed almost half its locations
Source
Originally published at www.thestreet.com.
