Children’s Place Files for Chapter 11 Bankruptcy Amid Declining Birth Rates

Falling birth rates, cautious consumers, competition and $881 million in debt drove Children’s Place to file for Chapter 11 protection on Sunday, MarketWatch reported.

Although the New Jersey-based retailer reorganized management and trimmed expenses in recent years, its yearly revenue has declined continuously since 2022. Americans are having fewer children, helping explain why the shopping-mall fixture found itself in bankruptcy court.

“The children’s wear market is tough because there’s a declining birth rate,” Neil Saunders, a retail analyst at GlobalData, said. “It’s also tough because parents are under pressure and they’re looking to save money, so they’ve trimmed back on volumes or they’re looking for cheaper products.”

Saunders said that other players face similar headwinds. Yet he added that Children’s Place failed to keep up with retail rivals like Target, whose Cat & Jack children’s clothing line grew into a nearly $3 billion brand. Amazon and Walmart also pushed further into the space.

Inflation and declining birth rates pressure kidswear retail

When inflation started squeezing shoppers after 2022, Children’s Place did not focus enough on lower prices, Saunders noted. As busier parents turned to online shopping, the company raised its threshold for free deliveries, driving shoppers toward larger rivals.

The Centers for Disease Control and Prevention reported that the U.S. fertility rate fell 1% in 2025. It has dropped 23% since 2007. Other companies said that consumers spend more per baby despite that drop, though how much of that stems from inflation remains unclear. Emarketer expects U.S. kidswear retail sales this year to rise 4.5% to $69.28 billion.

Suzy Davidkhanian, an analyst at Emarketer, said that a chain like Children’s Place tended to serve special occasions and gift-giving. Trips there did not feel as natural as stocking up at Walmart or Target.

“Those are destination places,” Davidkhanian said, describing big-box stores. “People go there to buy lots of things, and then also add children’s wear to their basket, versus go[ing] there to buy only children’s wear.”

Children's Place plans to sell substantially all assets

Children’s Place announced Sunday that it plans to sell substantially all of its assets. Its e-commerce sites and stores remain open and running.

According to court documents, the company had total assets of roughly $742 million. As of its second quarter, which ended on Aug. 1, it had 514 stores.

During a conference in September of last year, CFO John Szczepanski said that the business originated as a 1969 toy store that simultaneously retailed kids’ apparel. By the 1980s, it shifted entirely to apparel, and sales topped $2 billion in 2007, FactSet data shows.

The stock tumbled 41.8% on Monday and dropped another 4.7% on Tuesday, trading under 18 cents a share. That marks a steep fall from its early-2018 highs of around $160.

Children’s Place is asking interested parties to submit bids by Dec. 9.