The new year is just getting started, but one major retailer is already calling it quits. The parent company of the discount department store chain Shopko has announced that it has filed for bankruptcy. It will close over 100 of its 367 Shopko stores in 25 states, including in Wisconsin where the company is headquartered.
Shopko, like many brick-and-mortar stores, has struggled in recent years, as more people turn to Amazon and other online retailers to do their shopping. In 2018, over 25 major retail chains filed for Chapter 11, including household names like Sears, Claire’s, David’s Bridal and Nine West, among others.
However, one expert pointed to other big box stores as Shopko’s main competition, rather than online retailers.
“Shopko used to be a great regional company … I doubt the internet had much to do with it. [It’s] tough to be a small guy in the world of 4,500 Walmarts and 15,000 Dollar General stores,” retail analyst Nick Egelanian told Retail Dive.
Shopko is reported to have less than $1 billion in assets and cumulative debt that is somewhere in the $1 billion to $10 billion range. By closing stores and auctioning off its pharmacy assets, the company hopes to reorganize its debt by the March 14 deadline set by the bankruptcy court.
The company first opened its doors in 1962, and its original location, located in Green Bay, Wisconsin, is one of the stores that’s set to close. It’s upsetting news for many Shopko fans, including Green Bay resident Vicki Villers.
“I started crying and said, ‘Not my store … My husband and I depend on this store. We love this store. I hate to see it close,” Villers told the Green Bay Press Gazette.
According to the newspaper, Shopko currently operates 367 stores in 25 states, including full Shopko stores, Hometown stores, Shopko Express and Shopko Optical locations. It’s closing certain locations based on an analysis that identified 70 stores that are unprofitable and another 40 stores that were are marginally profitable.
The company also plans to relocate many of the optical centers located in closing locations to free-standing stored nearby. “This decision is a difficult, but necessary one,” Shopko CEO Russ Steinhorst said in a news release. “In a challenging retail environment, we have had to make some very tough choices,
Shopko locations set to shutter are already liquidating their inventories. To find a full list of locations that are closing, visit the Shopko website.