B.U.M. Hits Bottom, Files for Bankruptcy
B.U.M. International Inc., the Compton-based casual clothing maker with the prestigious logo, has filed for bankruptcy protection and will begin to liquidate its 41 factory outlet stores in May.
B.U.M. said it decided to close its stores under Chapter 11 of the U.S. Bankruptcy Code because of disappointing sales. The company, which has not yet completed its annual financial statement, said it expects to post a loss of $9 million to $16 million for the fiscal year ended Dec. 31. B.U.M. said it also expects to report a loss of more than $1.7 million for the first quarter of this year.
The bank that financed those unprofitable retail operations canceled lending arrangements after B.U.M. failed to meet financial performance targets in loan covenants, said Troy Wiseman, company spokesman and a member of its corporate board.
Wiseman said merchandise at B.U.M. stores will be offered at liquidation sales over the next three to four months. The company has factory outlet stores in 20 states. Long Beach, City of Commerce, Camarillo and Cabazon are among the store location sites in Southern California.
The decision to reorganize under bankruptcy protection marks a reversal of fortune at B.U.M. The company is best known for the cotton-knit sweatshirt featuring an oversize puff-printed B.U.M. logo on the chest. Demand for the sweatshirt, introduced in 1986, helped make B.U.M. one of the most successful producers of athletic-inspired apparel in the nation. Sales grew from about $6 million in 1987 to nearly $300 million in 1994.
The company’s line of merchandise is also sold by other retailers. Wiseman said merchandise with the B.U.M. logo will remain available at other retail chains because other companies produce the casual wear under licensing agreements.
The company began to wind down its manufacturing operations last year and no longer makes clothing.
B.U.M. was among the manufacturers named in a lawsuit by lawyers for 68 Thai garment workers freed last August from prison-like conditions in El Monte by state and federal agents.
The suit alleges that B.U.M. profited from the workers’ labor. Wiseman said B.U.M. did not have direct dealings with anyone associated with the El Monte sweatshop.
