What: Ssense’s bankrupt cy protection filing has triggered a conflict with creditors, as management seeks to implement its own restructuring plan amid regulatory and liquidity pressures.

Why it is important: The conflict highlights the growing instability in digital-first luxury retail, where external shocks and creditor-management disputes threaten established business models.

Ssense, once a leader in luxury and avant-garde e-commerce, is now at the center of a high-stakes conflict between its creditors and management. The Montreal-based retailer has filed for bankruptcy protection under the Companies’ Creditors Arrangement Act, following a liquidity crisis intensified by the recent elimination of the U.S. de minimis exemption for goods under $800. This regulatory change, combined with tighter liquidity and increased trade pressures, forced the company’s primary lender to initiate a sale process, directly opposing management’s own restructuring plan. CEO Rami Atallah has emphasised the need to protect the company’s assets and rebuild for the future, arguing that management’s approach better serves employees, customers, and vendors. The crisis has already led to significant layoffs, heavy discounting, and strained relationships with emerging brands, as Ssense stopped paying deposits and struggled to maintain vendor trust. With the court set to decide between competing plans, the outcome will determine whether Ssense can stabilise and adapt or be sold off, reflecting the broader volatility and transformation facing the luxury retail sector.

IADS Notes:

Ssense’s turmoil closely mirrors recent industry developments, such as LuisaViaRoma’s restructuring and Hudson’s Bay’s bankruptcy protection in March and July 2025, both driven by financial strain and creditor negotiations. The elimination of the U.S. de minimis exemption in April and June 2025 has upended cross-border e-commerce, exposing the fragility of digital-first models and forcing rapid operational resets. Vendor relationship challenges, as seen with Saks Global’s payment term backlash in early 2025, further illustrate the sector’s struggle to balance cost control with brand partnerships. The strategic tension between creditors and management, highlighted in the Saks/Neiman Marcus merger and LuisaViaRoma’s negotiations, underscores the complexity of navigating stakeholder interests in today’s luxury retail landscape.

Ssense files for bankruptcy