hhgregg to shutter stores
Struggling appliance and electronics retailer hhgregg today announced it will close 88 stores including four in metro Atlanta.
"We are strategically exiting markets and stores that are not financially profitable for us," said Robert J. Riesbeck, hhgregg's President and CEO, in a prepared statement.
The stores closures represent about 40% of the chain's current store count.
"This is a proactive decision to streamline our store footprint in the markets where we have been, and will continue to be, important to our customers, vendor partners and communities. We feel strongly that the markets we will remain in are the right ones for our customers and our business model. Our team is dedicated to moving forward and being a profitable 132 store, multi-regional chain where we will continue to be a dominant force in appliances, electronics and home furnishings."
“We have determined that the economics of the affected locations will not allow us to achieve our overall goal of becoming a profitable company again,” Riesbeck said. “After scrutinizing our real estate portfolio, we have identified a number of underperforming stores, as well as store locations that are no longer strong shopping destinations due to changes in the local retail shopping landscape.”
The Atlanta closures include the hhgregg store in Buckhead at Buckhead Triangle. The Buckhead store opened in October 2012 in a space that had previously housed Circuit City before their 2009 bankruptcy.
Hhgregg will also shutter their stores on Pleasant Hill Road near Gwinnett Place Mall in Duluth, in Lithonia near The Mall at Stonecrest, and in Morrow on Mount Zion Road not far from Southlake Mall.
A store representative indicated to me that liquidation sales will begin at all stores tomorrow with all in-stock merchandise on sale. Sales are expected to continue for six weeks or until all stock is sold, which ever happens first.
According to the company's website, hhgregg will continue to operate nine other stores in the greater metro Atlanta area including locations in Alpharetta, Smyrna, Snellville and Buford.
The full announcement and store closure list can be found here.
The other stores slated to close are in Alabama (2 stores), Delaware (3), Florida (15), Illinois (6), Louisiana (3), Maryland (11), New Jersey (2), North Carolina (4), Ohio (4), Pennsylvania (15), Virginia (16), Tennessee (1), Missouri (1) and West Virginia (1).
Hhgregg will also close distribution centers in Miami, Brandywine, Maryland, and Philadelphia.
In total, the closings will result in the elimination of approximately 1,500 jobs.
Indianapolis based Hhgregg announced February 15th that it was pursuing a range of "strategic and financial options" with the help of third party financial advisers, to improve the company’s financial condition. Bloomberg reported February 23rd that the 61 year-old retailer was preparing to file for Chapter 11 bankruptcy reorganization, potentially as soon this month.
Hhgregg, which currently operates 220 stores in 19 states, took a $58.3 million loss in its most recently completed fiscal quarter, with revenue plummeting 24%.
As recently as 2013, hhgregg's stock (HGG) was trading in the $20 range. Today, the stock, which was recently de-listed from the NYSE, trades at about 20 cents. The stock was UP to 21 cents midday today, a 57+% increase over its 13 cent close yesterday.
Hhgregg's store closure announcement follows announcements from Family Christian Stores, kmart, Sears and The Children's Place, all of whom have announced plans to close significant numbers of retail stores. (Family Christian will close all 240 of their retail stores.)
Are you surprised that hhgregg is closing so many stores? Where do you shop for appliances and electronics? What would you like to see open in place of the soon-to-close hhgregg stores in metro Atlanta?
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