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Payless Said to Close Up to 500 Stores in Bankruptcy Reorganization

Yet another store chain looks set to seek bankruptcy protection in a brutal retail environment.

Payless, the operator of a discount shoe chain, is set to file for bankruptcy protection as soon as next week, Bloomberg News has reported, citing unnamed sources.

A Payless spokeswoman declined to comment to Fortune on the report.

As part of that restructuring, Payless would close as many as 500 stores, though it had considered shuttering up to 1,000 stores, according to the report.

Payless was founded in 1956 in Topeka, Kansas, and employs about 22,000 people, according to its website. It operates 4,000 stores in 30 countries. In its last year as part of a publicly traded company, 2012, it had U.S. sales of about $2 billion. The retailer rose to prominence by offering customers a new approach: self-service in a shoe store in exchange for lower prices.

But Payless has struggled in an increasingly competitive footwear world, with everyone from DSW (DSW) to T.J. Maxx (TJX) encroaching on what had been its turf.

Payless, which had been part of Collective Brands, was acquired in 2012 by buyout firms Golden Gate Capital and Blum Capital in a $2 billion deal.

The prospect of a Payless bankruptcy is just the last bad news to buffet the retail world. Stores like The Sports Authority, American Apparel, Aéropostale, Wet Seal and PacSun are among the retailers to have filed for bankruptcy protection in the last two years, with some liquidating altogether. On Tuesday, Sears Holdings (SHLD) admitted there is ‘substantial doubt’ it can stay in business.