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Gottschalks' demise leaves voids in West Coast towns

Posted: Tuesday, May 05, 2009

FRESNO - Gottschalks, a regional retailer with 58 stores anchoring main streets in far-flung towns across the West, has been turned over to a team of liquidators after 105 years in business.

Last week, they began selling off the chain's collection of mid-priced clothing, household goods and fixtures to satisfy debt.

To many small West Coast towns, the loss is immeasurable. From tiny Soldotna, Alaska, where Gottschalks is one of the city's biggest tax generators, to Oakhurst in the Sierra foothills, where seniors flock to discount Tuesdays, the liquidation reverberates.

"We have a lot of seniors who come in for the discount and make a day of it," said Raymond Peck, who has worked 15 years for Gottschalks.

The company's demise, said sales associate Donna Putnam, "is like a death in the family."

Gottschalks bought the former Ford's Department Store in Watsonville, Calif., after the 1989 Loma Prieta Earthquake ravaged downtown. After the 10-week liquidation sale, the largest downtown retailer left in the farm community will be Goodwill.

"This is going to be a tough thing for this city to recover from," said Jerry Beyersdorff, president of the local Pajaro Valley Chamber of Commerce and Agriculture.

In Juneau, Gottschalks located in the Mendenhall Mall is the city's only traditional department store. About 45 people are employed there, according to the store manager. There are four other locations in Alaska.

It has been a long, slow death for Gottschalks even as other retailers caved to the recession, big box stores and Internet shopping. As the stock price slid below $2 a year ago, the company closed unprofitable stores. In October, the New York Stock Exchange de-listed the company. In January, the company filed for Chapter 11 protection.

The closing is a kick in the gut to Fresno, the chain's birthplace. The retailer has been a source of summer jobs and civic pride. People here viewed Gottschalks' spread across the West, beginning in 1961 with a store in Merced, as a sign this former cow-town had come of age.

Aging baby boomers bought their first pair of Levi 501s, held their first jobs and received their first charge card at Gottschalks. Well into the 1970s, shoppers wore hats and gloves when they visited to the Fresno store, instead of making excursions to San Francisco.

"They even sold books," said local historian Cathy Rehart, 69. "I bought all my Nancy Drew books there. I'd save up $2.35 and my mother would take me downtown to buy the next in the series. You not only made your purchases there, but you met your friends. You had the sense going there that Fresno had arrived."

Gina Vance's first job 31 years ago was in Gottschalks fabric department, which paid her way through Fresno State University's teaching program. She never left the company.

"Never in my wildest dreams did I think I'd stay here so long," said Vance, manager of the chain's Manchester Center store, where senior citizens still meet for birthday lunches in the restaurant. "It's been a heck of a good ride."

The chain started as a family operation. Company chairman emeritus Joe Levy, a graduate of the University of Southern California School of Retailing, recalls that his father sent him to Des Moines, Iowa, to learn the family business at Younkers Department Store, then one of 300 or so regional retailers across the US.

When he returned in 1956, Gottschalks' single store in downtown Fresno did $4 million annually in sales. Levy sold bridal gowns at a loss because bridal gifts more than made up for it.

"In today's world everything is a formula," said Levy, 77, an old-school haberdasher who, even as he boxed a century of memories, wore his crisp white dress shirt with tie clipped into place. "The bean counters want to know what's your business plan. They'd write them up and then three months later I'd say 'how come what we're doing looks nothing like this?' I always went by my gut."



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