The Container Store has filed for Chapter 11 bankruptcy protection amid heavy losses, declining sales and increasing competition.

Business in its stores and online will continue as usual during the restructuring, the Texas-based home goods, warehouse and custom closet chain said late Sunday. Customer deposits for in-home services will be honored and merchandise orders will be delivered as usual.

“The Container Store is here to stay,” Chief Executive Satish Malhotra said in a statement. “Our strategy is sound and we believe the steps we are taking today will allow us to continue to advance our business.”

The Container Store peaked in fiscal 2021, when the company topped $1 billion in sales for the first time and posted record profits as consumers spent heavily on home remodeling and renovation projects during the months-long pandemic quarantine. A nationwide decluttering trend sparked by organizing expert Marie Kondo also benefited the chain.

But the container store has struggled since then.

Part of the company’s troubles comes from competition from rivals like Target, Walmart and Amazon, which often sell similarly stylish storage items at a lower price. And as home prices and mortgage rates remain stubbornly high, many would-be homebuyers are forced to wait, dampening demand for a wide range of products and services that come with outfitting a new home.

For the three months ended September 28, the Container Store reported a loss of $16.1 million. Revenue totaled $196.6 million, down 10.5% from the year-ago quarter. Same-store sales fell 12.5%.

Founded in 1978, Container Store operates more than 100 stores across the country. In Los Angeles County, the company has locations in Century City, El Segundo, Pasadena and Woodland Hills.

Two weeks after the New York Stock Exchange told the company that its shares would be suspended for failing to maintain an average global market capitalization of at least $15 million for 30 consecutive trading days, the company filed for bankruptcy protection in the Southern District of Texas .

The Container Store said it expected to confirm a restructuring plan within 35 days and emerge from bankruptcy as a private company soon after. The company said at least 90% of its term loan lenders had committed $40 million in new money financing.

The Chapter 11 process does not include Elfa, a separate custom cabinet company based in Sweden that is owned by Container Store.

In an email to clients on Monday, Malhotra said the company had felt “the impact of the difficult macroeconomic environment” but assured them that “our commitments to you will be fulfilled as expected.”

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