Beyond the Rack Files for Bankruptcy Protection

Beyond the Rack Files for Bankruptcy
30 March 2016

Some sad news for the Beyond the Rack members this morning as the Canadian-owned online shopping club announces that it has filed for bankruptcy protection.

For those of you who don't already know, Beyond the Rack is a private shopping club that members join for free online and receive great discounts on brand-name and designer merchandise during daily shopping events. "Flash sales" are announced at a certain time, say 9am EST, and then closed again with an email announcement later that day. Once the sale is closed, that item is no longer available.

Beyond the Rack ships to members from New York, Las Vegas and Montreal and has built up a very sizeable and dedicated member base in both Canada and the U.S.A. In fact they declared $150 million in sales in 2013, and co-founder Yona Shtern announced that they were well on their way to becoming a $1 billion company.

Unfortunately it doesn't seem to have worked out as such for this unique Canadian business, a court order filed with the Quebec supreme court on March 24, reports that Beyond the Rack's net sales fell from $133.1-million in fiscal 2015 to $96.0-million in 2016 (unaudited).

What this means for members:

Beyond the Rack has issued a press release this morning announcing that they have secured interim financing which will allow them to continue operating during this restructuring period and that operations will continue on as normal. The website is still up and running and because interim funds have been granted, there is likely no reason to panic if you have unfulfilled or pending orders. However, you should be aware that there have been rumblings of members unhappy with their service at Beyond the Rack on social media lately:

We are sad to hear about the difficulties for what had until now been such a fabulous Canadian success story and certainly hope that they will be able to power through this difficult financial time and continue on their path without much interruption.

Are you a Beyond the Rack member?


  • Justyna T.

    Boo this sucks!

    • Andrea R.

      Aww boo im upset :expressionless:

  • Katie G.


    • Jen B.

      I'm not surprised the prices have been high and same with the shipping

    • Katie G.

      Had to tag you because I remember you ordering here before lots

    • Jen B.

      Ya I did a lot last year but it hasn't been very good lately

  • Amitabh88

    I had about $24 credit. I guess I won't be seeing that anytime soon.

    • miarodak

      Sounds like they will be continuing with business as usual for now since they have received interim financing! I'd see if you can use that credit! I hope that they will find their way out of this rough spot successfully. 

      • donotshopatbtr


        They declared Bankruptcy, there is no shipments going out..they laid off half their staff..if they were reputable then they would return the credits to the customers or ship the items...they have no monies to buy these products that have been purchased  by customers...we paid for them but no money for the suppliers...don't encourage people...people should not be shopping on the site.  What they should do is fulfill the items that have been ordered instead off taking new orders and taking peoples monies now.  That is the solution.  People don't know they have gone bankrupt and they are still shopping on the site...they should close the site and fullfill the outstanding orders back from February.

  • lsanders

    not surprised. I ordered sheets and 2 months later, I had forgotten and remembered, looked in my account and they were still "pending shipment" contacted them to cancel and they had to go back and forth with the "supplier". It was such a headache and I never got the sheets!

  • dilbert1977

    Not all that surprised, it's the same product every other day with the tile of the sale all that's changed. And their reg prices are over inflated, as recently just saw 2 jackets at the manufactures store and the reg price was not even close to the one on BTR site

  • Lucy L.

    Scam! Beware!

  • donotshopatbtr

    I have $600 credit... there is going to be a lot of people that will lose monies here that is for sure...They should be returning the credits as cash refunds now. The President sent me $10 to shop and lied as usual saying the company was being bought by different ownership. This is the same thing that Modaff has done...he pockets the money with his homes and boats and we as customers have to pay for it. Especially when we returned items we got credits not returns all went to him..I hope he sleeps well at night.

  • Ryck

    I agree with the person who suggested the website should be shut down during the interim period of finding a financial means of recovery rather than on the backs of unsuspecting customers who are unaware of the companies filing of Bankruptcy.  The website should be terminated with an apology and a promise to refund or fill outstanding orders.  

    • dkneeshaw

      Is there anything those of us can do who have placed orders and have been waiting since February? Will the credit card companies reimburse the payment? Or am I just out that money now?

  • Saffron_Blaze

    Bankruptcy is one thing. Continuing to operate while under bankruptcy protection is valid too. The deceptive practice of taking orders you know you won't fill is illegal.

  • jenniferp

    It's evident that they are poorly managed. How can a company a few years back with hundreds of millions of dollars in sales be filing for bankruptcy. First of all, they didn't use their own funds to run their daily business. The business is based on consumers paying upfront for merchandise they were made to believe they will get within a 2 week window. It is always the consumers that lose in this case and almost certain their suppliers are not getting pay for their merchandise either. I don't feel bad for the company, but rather the employees that has to deal with all the negativity.

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