Tweeter demonstrates how not to handle liquidation
The regional electronics retailer abruptly shuts down, leaving employees, customers hanging.
As if your company shutting right before the holidays weren't bad enough.
Regional electronics dealer Tweeter, scheduled to close its doors December 7, on Tuesday suddenly closed down all its stores. Six hundred employees at 70 stores were fired immediately. Many employees are still owed back pay, and some customers are still owed merchandise that has already been paid for, according to The Boston Globe, which cites five unnamed store managers and executives.
According to the Globe:
The employees, including roughly 150 in Massachusetts, are still owed at least one week's pay, vacation time, and hundreds of thousands of dollars in bonuses that were promised as part of the liquidation sale, said the managers and executives who declined to be named because they are still owed money. Customers are unable to pick up merchandise they had already purchased and the liquidators handling the closing also have not been paid. Meanwhile, there is roughly $14 million worth of goods left in the locked stores.
The Globe's sources say that while Tweeter's owner, Schultze Asset Management, paid off the company's largest creditor, Wells Fargo, it didn't want to continue covering the costs of shutting down the business. So Schultze locked the doors five days early and told managers not to come to work anymore.
The Hartford Courant also reports that customers were sold warranties after the company had already declared bankruptcy, and that merchandise preordered and prepaid before the bankruptcy has still not been delivered to customers.
It's not exactly normal for companies currently in liquidation to just shut down, particularly when they still hold inventory worth any value. Tweeter isn't talking, other than to say "things will work themselves out."