Companies affiliated with the line of beauty products branded Carol’s Daughter have gone bankrupt. On Thursday Carol’s Daughter filed for Chapter 11 bankruptcy protection after the brand moved to close most of its stores. The court papers filed, signed by Carol’s Daughter Chief Financial Officer John D. Elmer, stated most of Carol’s Daughter stores have been unprofitable since 2010.
Prior to filing bankruptcy the company terminated 29 employees and closed five of its seven stores. The stores which have remained open are in Brooklyn and Harlem. Mr. Elmer said the company hopes to use its time in bankruptcy to consolidate and reorganize operations for its remaining stores. In addition to the Brooklyn and Harlem locations Carol’s Daughter has products for sale on its website and outlets such as Sephora, Macy’s, Target and the Home Shopping Network.
This is not the first time the creator of the brand has faced bankruptcy. By the age of 28 Lisa Price was forced to declare bankruptcy after owing the IRS tens of thousands of dollars. A few years later Price managed to start her company with on $100 cash, without credit or loans. She built her company slowly until she could pay off her enormous debt.
Price created her company out of a passion to bridge the gap for the lack of cosmetics designed specifically for African-American women. She has since developed her company into the empire that Carol’s Daughter has become today.
Before being featured on the Oprah show in 2002 the New York City-based company was generating nearly $2 million in revenue annually with approximately 200 clicks on the website daily. After the mogul Oprah Winfrey showcased the brand on her show Carol’s Daughter’s site crashed after it received 17,000 visitors within 10 seconds. Of course, it recovered and skyrocketed to a $20 million brand.
Price built her company from the ground up; evolving from a small home-based business to a multimillion dollar company. Here are a few secrets to success Price said she learned along the way.
Have a sincere and cohesive team: It takes a village when building a company. Price said it is important to have a team that really believes in the brand and understands the visionary.
Do not be afraid: It is important to fight fear and take risks. It is not effective to dwell on the unknown or what might happen if a risk is taken. Price is more afraid of what might happen if she does not do something than what could happen if she does.
Adjust when necessary: She adjusted her initial plan to open more independent stores in lieu of pursuing partnerships which would not deplete the cash flow as much. The result was fantastic.
Do not substitute positive thinking for getting busy: Being a positive thinker is good but that cannot take the place of taking an active role in how things form and play out.
Check your ego: Although Price is the creator of the brand she had to guard against the big ego that goes along with being an entrepreneur. It is important to be accountable to others and to allow them to offer input into the decision-making.
When the opportunity arises for a do-over, do better: Price said being forced to declare bankruptcy when she was younger taught her it is okay to make mistakes because recovery is possible. Learn from the struggles of yesterday and do better today.
Carol’s Daughter makes hair, body and skin care products with natural ingredients. Its main focus is the creation of products for African –American women. This brand has benefited in the past with financial backing from such celebrities as Jay Z, Will and Jada Smith and was featured on Oprah.
According to the chief executive of Carol’s Daughter, Richard Dantas, the brand is now available in over 2,000 other retail stores around the United States. Dantas said the company is now focusing on a distribution strategy with these retailers. He went on to say the Chapter 11 filing does not reflect the parent company’s healthy financial situation. It is simply a part of its plan to increase the brand through national retail outlets.
Companies affiliated with the line of beauty products branded as Carol’s Daughter have gone bankrupt. On Thursday the well-known company filed for Chapter 11 bankruptcy protection after the brand was forced to close most of its stores.
By: Cherese Jackson (Virginia)