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Dots LLC, the 400-store clothing chain for young women, filed for bankruptcy protection, blaming prior management, the economy and leases that cost too much, Bloomberg News reported yesterday. The company, founded 27 years ago outside Cleveland, has arranged to borrow $36 million to keep operating as it reorganizes under chapter 11 protection and implements a new merchandising strategy. In October, vendors began demanding Dots pay for new goods faster than the company could afford, “causing significant liquidity challenges,” Chief Executive Officer Lisa Rhodes said in a court affidavit filed yesterday. For the 12 months ending Jan. 31, the company had about $293.7 million in sales, Rhodes said. That’s down from $338.8 million in the previous 12 months and $346.2 million the year before that.

Best Buy Co.’s decline in holiday sales, which triggered a 29 percent drop in its stock yesterday, is raising doubts over Chief Executive Officer Hubert Joly’s turnaround strategy, Bloomberg News reported today. When Joly joined the world’s largest electronics chain in September 2012, he zeroed in on becoming price competitive with the likes of Amazon.com Inc. His theory was to remove price from the purchase decision and consumers would stick with Best Buy because they can find a wide assortment of products, get advice from knowledgeable staff and test gadgets. That approach failed to boost holiday sales in the U.S., which includes stores and online purchases. Even though the chain aggressively slashed prices, revenue from outlets open at least 14 months fell 0.9 percent in the nine weeks ended Jan. 4, the Richfield, Minnesota-based retailer said yesterday. In addition, Joly’s price cuts will narrow profit margins by twice as much as the company expected in the fourth quarter.

Fast-food pizza chain Sbarro LLC, which emerged from bankruptcy protection about 14 months ago, has tapped restructuring advisers amid business struggles, the Wall Street Journal reported today. Closely held Sbarro, which carries roughly $150 million in debt, recently enlisted restructuring lawyers at Kirkland & Ellis LLP and bankers at Moelis & Co., these people said. There are roughly 1,000 Sbarro restaurants across 30 countries, according to its website. The majority of its more than 600 U.S. restaurants are located in food courts and airports. The chain, based in Melville, N.Y., filed for bankruptcy in April 2011 and emerged in November 2012, cutting its debt roughly in half. A bankruptcy filing by the company is not imminent, according to those familiar with the hiring of the restructuring advisers.

Going-out-of-business sales could begin as early as Thursday at Loehmann's Holdings Inc.'s 39 designer discount retailers after the bankruptcy court's approval yesterday of a sale worth $16.4 million, Dow Jones Daily Bankruptcy Review reported today. Bankruptcy Judge Martin Glenn yesterday approved the sale of two groups of assets and scheduled for Friday a hearing on a third sale worth an additional $7.5 million. Loehmann's auction, held on Friday, overall garnered $23.9 million for the company's assets.

The National Retail Federation (NRF) has filed an appeal over credit card transaction fees, seeking to quash a class-action settlement between merchants and Visa Inc. and MasterCard Inc., the Wall Street Journal reported today. The move comes after a federal judge in December approved a $5.7 billion agreement — billed as the largest settlement of an antitrust case — to end years of litigation against payment networks Visa and MasterCard, as well as several banks that issue their credit cards. Merchants and their trade groups sued the companies in 2005, alleging that they conspired to set so-called interchange fees at unfairly high levels. Despite the accord, several plaintiffs, including the NRF, said that they would appeal the settlement. When the ruling was announced, the NRF called the settlement "deeply flawed."

Bankruptcy Judge Martin Glenn approved revised sale procedures for Loehmann's Holdings Inc., which pushes the auction into the new year, Dow Jones Daily Bankruptcy Review reported today. The auction is scheduled to take place Jan. 3 and Judge Glenn will review the results of the auction on Jan. 7. Bids are due by Dec. 31.

Retailers yesterday reported weaker-than-expected sales in November as a slew of deals and promotions, particularly during the Thanksgiving holiday weekend, weren't enough to entice shoppers to open their wallets, the Wall Street Journal reported today. Industrywide, sales over the Thanksgiving weekend, which included the first day of December, were lackluster. Although companies from Wal-Mart Stores Inc. to Target Corp. trumpeted strong traffic in stores and online, most retailers haven't provided specific sales numbers for the weekend. "The consumer is still fairly cautious, and they are going to be very reactive to promotions," said Keith Jelinek, a director in consulting firm AlixPartners' retail practice. Several retailers noted that November's sales were hurt by the last day of the Thanksgiving holiday weekend falling in December.

Bankruptcy Judge Mary Walrath approved the $40.8 million sale of golf retailer Edwin Watts to a duo of purchasers who could keep some of its 91 stores open, the Wall Street Journal reported today. After a court hearing yesterday, Judge Walrath cleared GWNE Inc., an affiliate of Worldwide Golf Shops, and liquidator Hilco Merchant Resources LLC to take over the chain after the buyers teamed up to win a bankruptcy auction earlier this week. The company hasn't said publicly how many stores will remain open, but court papers show that the purchasers plan to keep lease agreements at 49 locations.

The once-booming sandwich chain Quiznos is stumbling two years into a major turnaround effort, prompting the company to seek concessions from creditors owed nearly $600 million, the Wall Street Journal reported today. The Denver-based chain, known formally as QIP Holder LLC, has struggled with store closures and tension with franchisees. It recently missed a payment on a loan, and has been negotiating to restructure some or all of its debt load with creditors, who have hired bankers and lawyers. Those talks have led to a forbearance agreement with the creditors designed to give Quiznos more time to hash out a deal, Quiznos Chief Executive Stuart Mathis said in a memo on Wednesday to franchisees.

Ron Burkle's Yucaipa Cos. won court approval on Friday to take over about 150 Fresh & Easy Neighborhood Market stores, salvaging most of Tesco Plc's U.S. grocery-chain venture, Dow Jones Daily Bankruptcy Review reported today. Bankruptcy Judge Kevin Carey signed off on the deal, which is being financed by the British retailer with a $120 million loan, part of an agreement struck before Tesco put Fresh & Easy under chapter 11 protection.