Bridal shops seek answers amid Discount Bridal Service bankruptcy

Daily Record, The (Baltimore), Jul 18, 2005 by Kathleen Johnston Jarboe

Brides aren't the only ones in a lurch as Discount Bridal Service Inc. in Halethorpe moves toward bankruptcy. The close to 500 dealers nationwide that sold its discount dresses have lost commissions, money, reputations and business as the Baltimore County retailer liquidates.

Some dealers relied on the brides looking for a bargain to drive other parts of their businesses from alteration and preservation services to veil, jewelry, tuxedo, wedding invitation and other sales.

I will still be providing alteration services through my seamstress shop. But all other aspects of my business are gone, said a Midwest dealer who declined to be named. She had been a Discount Bridal Service dealer for seven years and had been readying to move the business out of her home this year.

It is most clearly over, she said.

Discount Bridal Service, also known as Martins Bridal, could pass discounts from 20 percent to 40 percent off retail prices to bridal parties due to low overhead costs.

The business had just one official showroom in Maryland. But it had a vast network of dealers to collect sales. Most brides would shop at regular dress shops and then find a Discount Bridal Service dealer in their state to place the order.

Discount Bridal Service paid dealers a commission for their work. The fees ranged from 5 percent to 10 percent of sales. Those who just provided the service as an add-on were less affected in general.

I'm a bridal store. It is not hurting me at all. This is just one of the little services we did, said Karen Franxman, who runs Always And Forever Weddings in Union, Ky.

Still, many stores lost money when Discount Bridal Service suddenly closed earlier this month. The divide between the unlucky and those even less fortunate depended on how dealers sent money to Discount Bridal Service for orders.

Those who sent brides' money right to Discount Bridal Service and those who used company credit cards were relatively safe when the company collapsed, according to an industry analyst following the story. But dealers that collected fees from brides and then paid for the orders with personal checks could lose most of those fees.

For a small business to be hit by a $20,000 loss- that is a death blow for a small business, said Alan Fields, author of Bridal Bargains and Bridal Passport.

Thousands of orders were lost when Discount Bridal Service shut down, even though the company stopped collecting orders in mid- June.

Last week, the company said it would send brides and bridesmaid comparable dresses. But many customers have been unsatisfied with what they received.

Unhappy customers are bad news for dealers who relied on word of mouth to gain business, according to Fields.

Their reputation is being blown out of the water with this, Fields said.

Dealers have been working around the clock to find resolutions for brides. Some will never see money for their efforts. Dealers are still waiting for commission checks for sales made after March.

I worked all those months for nothing. Now I'm working all these months for nothing, said the Midwest dealer. She estimated Discount Bridal Service owes her $4,000 in commissions.

Some insiders have said the bankruptcy could send ripples through the bridal industry as it reopens old wounds. Bridal shops often complained to manufactures about the discount dealers that would undercut them in price but send discount customers to their full- service bridal salons to try on dresses.

Some bridal stores have stepped in to help customers with lost orders. Others have lobbied manufacturers to abandon brides stranded through Discount Bridal Service's bankruptcy, according to Fields and other dealers.

Franxman, the Kentucky bridal shop owner, said she would stop ordering from some manufacturers in the future.

I'm going to work with the ones that work with me. If they won't work with you in a crisis, who says they're going to give you good service on regular orders? Franxman said.