NORWALK, Conn. -- At least three factors stopped approving shipments to Caldor Corp., said a person familiar with the situation, meaning the retailer might not be able to keep its shelves fully stocked.
The news comes as Caldor, which has struggled amid fierce competition, said it is experiencing "sluggish sales." The company has 12 stores in Maryland.
Analysts said they expect same-store sales to decline by about 8 percent in August on slow back-to-school sales. That would be the sixth straight month of declining sales at Caldor stores open at least a year.
Similar shipping problems helped push another Northeastern discount retailer, Bradlees Inc., to file for bankruptcy court protection.
And Jamesway Corp., which exited bankruptcy in January, might be up for sale. Industry watchers worry that its vendors might stop shipping products because of its financial problems.
"If suppliers stop shipping to Caldor it's very bad," said Angela Uttaro, an analyst with CIBC/Wood Gundy. "This is a critical period for the Christmas selling season."
Caldor shares were down $1.25 at $10.25 in late trading of 2.1 million shares, 11 times its three-month daily average. Earlier, the stock fell 14 percent to $9.875, the lowest level in at least four years.
Factors buy accounts receivable from other companies at a discount and assume the risk for collecting.
