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WWD has more details about the shocking shutdown of Band of Outsiders last week, as the brand laid off the majority of staff, canceled fall orders and began to close its flagship NYC store. Band of Outsiders founder Scott Sternberg didn't disclose additional details on the closure. But sources told WWD that Sternberg had been in discussions with investors over the past few months, and a deal never materialized. Lisa Lockwood and Marcy Medina write: "It appears he simply ran out of money."
Band of Outsiders had expected fall to be a big season for the brand, and reportedly had substantial orders. Otte owner Kay Lee told WWD she was shocked when the brand canceled its fall delivery. "We order a lot every season. I spend about $20,000 and we have 80 percent sell-through. I always thought they were doing well, and our salesperson told me they had gotten an investor to help open the store, they were growing and opening new accounts."
Band of Outsiders' expenses may have exceeded its sales, sources say, as Sternberg tried to grow the brand. Former fashion director at Barneys Julie Gilhart told WWD: "It’s a question for midsize businesses — after they grow to a certain point and start needing stores, then what? It’s a really big issue for our industry. We spend a lot of time supporting young designers but where is support for the midsize people at a time when they critically need it?"