‘Financial crisis’: Liquidation sales possible as Bad Boy furniture makes bankruptcy act filing
Published November 13, 2023 at 10:45 am
Iconic furniture retailer Lastman’s Bad Boy could be clearing out its inventory as the Canadian company “is in financial crisis” according to filing under the Bankruptcy and Insolvency Act.
Bad Boy filed a Notice of Intention (NOI) last week for a “restructuring,” citing “a challenging and economic environment driven by high-interest rates, declining sales in the housing sector and a tight retail climate, particularly in the home furnishing sector.”
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The move has left customers who made cash or debit deposits for furniture and appliance deliveries unable to get refunds and led to questions about the future of the company’s 12 locations across Ontario and approximately 275 employees.
But the filing could also bring discounts to customers in the form of liquidation sales.
“The Company is considering a liquidation sale in certain or all of its stores so that it can wind-down the inefficient portions of its business in an orderly manner,” reads a document in the filing, which says Bad Boy expects to seek approval for liquidation sales “and the retention of a third-party liquidator.”
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The documents show Bad Boy had been struggling to stay out of arrears, owing “to many of its vendors, including substantially all appliance vendors” and most of its furniture suppliers.
“The Company is also having significant challenges sourcing inventory, which is affecting its retail business and its builder business,” the documents read, adding that some developers “have purported to terminate their contracts with the Company” which is “in financial crisis.”
Bad Boy was also keeping customer deposits in the company’s accounts which were “not held in trust,” with records showing the company “has received customer deposits totaling approximately $4.5 million.”
Lastman’s Bad Boy was founded by former Toronto Mayor Mel Lastman in 1990 with its flagship store located at 1119 Kennedy Road in Scarborough. It has expanded to include locations in Mississauga, Brampton, Hamilton and North York among others and is now wholly-owned by the founder’s son, Blayne Lastman.
Bad Boy locations are reportedly still open during the restructuring, but the company’s website has gone dark — a sudden cutoff that left customers anxious about the status of their orders.
Representatives reportedly failed to contact current clients awaiting deliveries and neglected to provide notification of the delays or the overall situation.
While customers who paid deposits by cash or debit are left without options for a refund, those who purchased items with a credit card have been advised to reach out to their credit card company for refund assistance.
Just last year, Bad Boy broke ground on a new $70 million headquarters in Pickering expected to bring 200 jobs to the region, as the company said it outgrew its headquarters in North York.
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