From the Yakima Herald-Republic Online News.


Posted on Sunday, April 05, 2009

Shop Talk: Reeling retail records another store casualty
by Mai Hoang
Yakima Herald-Republic

 

YAKIMA, Wash. -- The big news last week -- Gottschalks will be closing its doors for good.

Liquidation sales started Thursday after a U.S. Bankruptcy Court approved a bid for the Fresno, Calif., retailer. The retailer is currently owned by a group of liquidation firms.

Reporting this story for the YH-R got me thinking about some things.


Love it or leave it

In chatting with people, I got two reactions to Gottschalks' closure:

1. "Gottschalks is closing? Well, I never shopped there. Guess that's why it's closing."

2. "Gottschalks is closing? This is horrible. I always shopped there."

In pressing further, I learned some people just preferred to shop at discount stores such as Fred Meyer, Shopko, Target and Kohl's in Tri-Cities.

So while some Yakima shoppers may be sad about the departure of yet another anchor retailer -- J.C. Penney, Nordstrom and Mervyns all left downtown Yakima in the early 2000s -- I don't see the outrage that was apparent when the others closed.

It could be because Gottschalks doesn't have the history -- it only came into the area after taking over all the Lamonts stores a decade ago. One Shop Talk reader notes that the Union Gap store is much smaller than the Gottschalks stores in California. And my fiancee never hesitates to note that the store layout is something out of the 1980s.

But there's also plenty of devotion to Gottschalks. On Facebook, there's a group called "Gottschalks 1904-2009." Their page holds comments that it was a good place to work and how its departure will lead to a large shopping void for many smaller communities.

And for some Yakima shoppers, too. One co-worker said that she loved the good prices on bedding and luggage. And for those makeup fiends, it was one more place to get the "Free gift with purchase" from the makeup counters.

 

Liquidation sale bargains?

Since I wrote a lot about Linens 'n Things closing at the Valley Mall Plaza last year, I have a good idea what to expect at Gottschalks' liquidation sale.

In the beginning, there will be plenty of merchandise but a lack of good discounts.

And that discount may be on the full price of a item. For example, a sweater may have been on sale for $7.99 when Gottschalks was operating the stores a few days ago. But a liquidation company can mark that sweater back to full price, let's say $15. With a 20 percent discount, the cost would be $12.50.

So always compare prices -- chances are you can find it cheaper at a store that isn't closing than at a "liquidation sale."

And forget using plastic -- cash and check are generally the only types of payment being accepted. And it's hard to tell how long the liquidation companies would accept gift cards.

 

Filling in the gap?

As I reported in Wednesday's story, Fred Bruning has plans to work with another department store tenant if the liquidation firm doesn't find someone to take over the Gottschalks' lease with Bruning's company, CenterCal Properties.

But I think it will be a while before the mall (and the Valley in general) sees a new anchor-type retailer. Gottschalks expects liquidation to last into July. And given the age of the space, whoever occupies it will probably have to remodel.

But it's always fun to think of the possibilities.

Bruning mentioned J.C. Penney is his "sentimental favorite," but I think there's a good chance that J.C. Penney could come back to the Yakima urban area. (Remember, there's a J.C. Penney store in Sunnyside)

For one thing, a recent National Public Radio story notes that the Plano, Texas, retailer is still opening stores. And some investors believe that it will benefit from extra sales that will occur when Gottschalks closes for good.

Mary Ann Odegaard, the University of Washington retail management professor that I talked to for last week's story, mentioned that J.C. Penney is a great example of a retailer that changed to survive.

Like Gottschalks, J.C. Penney was known as a retailer for the budget conscious. But instead of staying there when other budget-minded retailers started hitting the scene, J.C. Penny updated its clothing lines and became more style-conscious, Odegaard said.

"They have introduced some new lines to compete for that "American look" at much more reasonable prices," she said.

Odegaard also had good vibes for Kohl's, another value-oriented retailer.

And they're hard to miss -- how many times in the last six months have you seen that "We have a new store opening, so every store gets a grand opening sale!" ad on television?

Not only has the Menomonee Falls, Wis.-based retailer opened new stores, it also acquired a whole bunch of new locations from Mervyns, which closed its doors late last year.

Odegaard said Kohl's will likely take advantage of the Gottschalks closing as long as they're in the right markets.

"(Kohl's is) a very good organization," she said. "Very smart and very aggressive. It's in the right kind of niche for that kind of economy."

• Can't wait until next week for the Shop Talk Reporter's Notebook? Check out the Shop Talk blog (www.yakimaherald.com/shoptalk) for up-to-date info about the retail and restaurant world.

Until then, happy shopping.

•  Mai Hoang's Reporter's Notebook is published every Monday in the Business section. To reach her, call 577-7685 or
e-mail mhoang@yakimaherald.com.