Gazoontite files for bankruptcy

Gazoontite.com, once noted for being one of the first pure online retailers to open brick-and-mortar stores, has filed for Chapter 11 bankruptcy protection in San Francisco, a court clerk said.

Though Gazoontite continues to operate its five physical stores--in Southern California, San Francisco, Schaumburg, Ill., New York City and New York's Long Island--the company shut down its Web store late last month.

The most common form of bankruptcy, Chapter 11 protects a company from its creditors while reorganizing its finances. Company executives did not return phone calls Tuesday.

The dot-com world is a desiccated landscape, with funding having dried up after technology stocks crashed last spring. E-commerce stores have attempted to slash overhead to preserve their cash, but with most a long way from seeing profits, a growing number are shutting down.

In the last few weeks, direct marketing site mValue, luxury-goods store Miadora.com and teen site Kibu are just a few examples.

For more than two months, Gazoontite, which sells asthma and allergy relief products, has wrestled with a cash shortage. In August, the company laid off about 50 workers, reducing its staff by 41 percent and began an intense search for new funding, a quest many dot-com executives are becoming familiar with.