As the era of free money ends, an increasing number of retailers have been pushed into bankruptcy — serving as prospective targets for bargain-hunting acquirers.

Why it matters: After a relatively dry past couple of years, firms that specialize in retail restructurings and distressed situations are seeing a spike in business, Richard writes.

Driving the news: The failures of Silicon Valley Bank, Signature Bank and Silvergate have had minimal impact on retail thus far — but First Republic's fall could shake consumer confidence and accelerate distressed situations.

Details: Headed into this year, inflation, rising interest rates and limited access to financing were posing going-concern hazards for the sector.

• Those pre-existing conditions may be exacerbated if the Fed keeps hiking rates, bank failures continue or the government defaults on its debt, putting a chill on consumer spending.
• Plus, home values — one demarcation of consumer wealth — are beginning to deteriorate, says Deborah Weinswig, CEO of Coresight Research.

Catch up fast: Bed Bath & Beyond is the latest casualty, following Chapter 11 filings by Serta Simmons and David's Bridal.

• As of April 13, S&P noted nine bankruptcies, which included the household name Party City, among others.
• That number compares starkly against just two bankruptcies filed by this same point a year ago.

Between the lines: Bankruptcies by the likes of BBBY and David's Bridal are emblematic of larger problems, says James Gellert, CEO of financial analytic firm RapidRatings.

• Those issues include higher costs, tied to supply chain, materials, labor and interest in addition to restrictive capital, he tells Axios.
• Inventory-related issues and consumer purchasing behavior also play a role, according to a lawyer who specializes in restructurings.
• Trade creditors are more leery of supplying struggling retailers with goods without payment upfront, a scar left by the Toys R Us bankruptcy, he says.

What's next: The biggest impact will be felt on the middle market, particularly regional retailers, Gellert says.

• "The smaller the company, and the more private, the fewer options they have to maneuver," he says.

Be smart: A silver lining, at least for dealmakers, is an uptick in buying opportunities.

• The sector will see an increase in M&A activity from well-funded strategics and PE, Gellert says.
• Capital needs to be opportunistic this year, he adds.
• For example, Authentic Brands Group picked up Boardriders, the rebranded Quiksilver, which was on distressed watch lists earlier this year.

The intrigue: Desirable retail real estate is in short supply but bankruptcies have made storefronts more readily available.

• Wisconsin-based specialty retailer Johnson Fitness & Wellness picked up 17 MyFitnessStore.com locations to expand into Texas, for example.

The bottom line: "It's going to be a tough year," Gellert says.