Careismatic, located in the city’s south end, is closing.
Dallas — Read this article and more North Texas business news from our partners at Dallas Business Journal.
The California-based medical scrubs company will close its Dallas facility effective May 31, eliminating 404 jobs.
Careismatic Brands Inc. notified the state in a May 2 Worker Adjustment and Retraining Notice that it plans to close its distribution centers at 35500 Lyndon B. Johnson Freeway and 4715 Mountain Creek Pkwy.
In a statement to the Dallas Business Journal, Carelismatic Brands said it made the “difficult decision to scale back operations at our distribution center facilities” to “enhance our logistics model and better serve business needs.” The company said it was grateful to its distribution center teams and was “taking steps to support them through this transition period” and working to “minimize the impact to our customers and ensure a smooth transition.” The company did not provide details about what it would provide to affected employees.
Workers will no longer have bumping rights, which allow a higher-ranking worker to replace a lower-ranking worker in exchange for losing their job.
The medical clothing and school uniform company filed for Chapter 11 bankruptcy protection in January and agreed to cede control to creditors to resolve $833 million in debt, according to a Reuters report. Founded in 1995 as Strategic Partners Inc., Careismatic Brands controls 50% of the U.S. wholesale medical clothing market and has several brands in its portfolio, including Dickies, Cherokee and Healing Hands, according to Reuters.
According to court documents, the company overinvested to meet growing demand for scrubs during the COVID-19 pandemic and took on additional debt to boost sales to its retail partners. The high debt load became unmanageable as demand returned to normal, interest rates rose and emerging competitors eroded the organization’s market share by selling clothing to customers online. The company’s revenues fell from $687 million in 2021 to $559 million in 2023.
