Gottschalks Sinking Fast; Filene’s Basement in Trouble


Yikes. They only just announced a Chapter 11 filing last week, but Gottschalks is on the fast track to oblivion. Inside Bay Area notes that Gottschalks needs a buyer now “or else:”

Gottschalks Inc. intends to find a buyer by mid-March or it might proceed with a complete liquidation of its assets, according to court papers filed by the bankrupt department store operator.

The retailer, whose operations include department stores in Antioch, Stockton, Tracy, Santa Rosa and Capitola, said it hopes to complete an auction by March 17 that would lead to a sale of the company. Fresno-based Gottschalks operates primarily in malls located in suburban and rural markets in California, Washington, Oregon, Nevada, Idaho and Alaska.

Absent a buyer, Gottschalks would move toward a liquidation during the spring, company filings with the U.S. Bankruptcy Court in Delaware shows.

Like I said the other day, poor Gottschalks has seemed like a weaker player for some time. Their stores are like relics from another era, straddling a funny line between Kohl’s and Macy’s and with locations in rural malls and second-tier markets. Their loss would be a very major one for many malls in smaller western markets.

At the same time, Filene’s Basement is closing 11 stores with leases they were apparently unable to negotiate. This may be a bad sign for the overall health of the once-storied chain. Filene’s Basement has been close to the brink before in the late ’90s after a zealous overexpansion and a dilution of their brand equity, after opening scores of suburban stores that were too similar to TJMaxx, Marshalls, and Ross to differentiate. The smaller chain retrenched of late, however, and began to trend upscale by offering high-end designer goods at significantly marked down prices; a nod to its beginnings as the clearance basement under the original flagship Filene’s store in Boston. That store, which is notable for hosting its annual “running of the brides” bridal clearance event, has been closed for several years while the site is being redeveloped. Many in Boston wonder if it will ever re-open, and this latest news seems to cast even more doubt on the prospect.

Coming soon: a post about a mall that actually has a Gottschalks in it! Neat!

Author: Caldor

Jason Damas is a search engine marketing analyst and consultant, and a freelance journalist. Jason graduated magna cum laude from Northeastern University in 2003 with a Bachelor of Science in Journalism and a minor in Music Industry. He has regularly contributed to The Boston Globe,, Amplifier Magazine, All Music Guide, and 168 Magazine. In addition, he was a manager for a record store for over two years. Currently, he focuses on helping companies optimize their web sites to maximize search engine visibility, and is responsible for website conversion analysis, which aims to improve conversion rates by making e-commerce websites more user-friendly. He lives in suburban Boston.

18 thoughts on “Gottschalks Sinking Fast; Filene’s Basement in Trouble”

  1. I admit I was surprised to learn that Filene’s Basement still operates at all. I know they’re closing their Natick/Framingham/whatever location, which is always a sure sign of death for a retailer in Boston MetroWest.

    This is somewhat unrelated, but rumor has it as of today that Old Navy will be the next to go. Heard this from UPS, which has apparently announced it to the package carriers to whom it’s relevant. Don’t know for sure yet….

  2. I hope not, I got a gift card for christmas from work.

  3. Haha, I have one of the closing Filene’s near me, and it’s hillarious, because on every corner there’s either a Circuit City closing sign person or one for Filene’s. Some corners have both people on them haha.

    But uh, I don’t know about Old Navy closing. That’s a LOT of stores, and it also includes the millions of GAP stores. That’d be terrible, honestly.

  4. Rumor has it El Corte Ingles, the Spanish hypermegastore (think a Wal-Mart footprint only 9 stories high and carrying Nordstrom quality merchandise) could purchase Gottschalk’s.

  5. Watch out for Office Depot – they are closing lots of stores, and I went into a store that wasn’t closing today that was very poorly stocked and staffed – I would put them on the death watch…

  6. I hate to see Gottschalks going down. They are similar to Belk in the South and Bon-Ton in the northeast and Midwest. Unfortunately, those two chains don’t have a geographic fit with Gottschalks and are likely financially stressed from absorbing Saks mid-tier department stores.

    Dillard’s would be a geographic fit, but again, it would be financially strapped to make such a deal. I would like to a viable alternative to Macy’s in the West, but I think the service levels at Dillard’s would be disappointing to customers more familiar with the traditional department store chains.

    Too bad about Filene’s Basement, though it hasn’t been part of Filene’s in more than a decade. Of course, Filene’s is gone, having been Macyated, and the stores have long since ceased to be Filene’s bargain basement outlet stores.

    Loehmann’s is also rumored to be in danger of failure this year too, another off-price fashion retailer.

    Times and expectations have certainly changed, there was a time when stores like Filene’s and Loehmann’s would prosper in poor economic times. I guess TJ Maxx and Ross Dress For Less have filled their ranks along with Walmart and cheapchic Target.

  7. I remember a Gottschalks in Scotts Valley, CA. Does anyone know if a store has replaced it or if it currently vacant?

  8. Correction: Filene’s Basement has been in trouble. So will have how many stores now (that I will be able to count on one hand)?

    FB and Loehmann’s I had thought were done years ago, just going through the drip stage this past decade or so.

  9. Filene’s Basement will have 25 locations remaining. They are closing 11 stores across the country.

  10. I shopped at the Eureka, CA store in 2000, It was as dated as the town of Eureka is.

  11. One of the three Maryland stores being closed is at Hunt Valley Centre, formerly known as Hunt Valley Mall. Those who are up on their dead-mall trivia probably recognize that name; Hunt Valley spent a decade in precipitous decline before being de-malled and turned into a lifestyle center earlier this decade. This incarnation has been more successful, largely because it is home to the only Wegmans in Maryland, but the cracks are starting to show. Last year, Wal-Mart closed its bustling Hunt Valley store and opened a Supercenter about a mile away; that vacancy has not been filled. (Personally, I wish Target would move there; there is one a few miles away, but it’s dingy and not very well-located in comparison.)

  12. Gottschalk’s will be hard pressed to find a suitor that is interested in expanding its presence. Especially considering Gottschalk’s stores run such a large gamut.
    I’ve already started to collect Gottschalk’s memorabilia before it’s gone.
    What’s unfortunate is that Gottschalk’s departure will mean the imminent death of a number of malls and shopping centers in the western states. I’ve already put my own death watches on a few malls.

  13. Does anyone know how Coddingtown mall is doing, in Santa Rosa? It seemed on the edge when I lived in that area a few years ago, and since they have a Gottschalks it’s worrisome.

  14. My wife was just laid off yesterday from Gottschalks. They paid her cash from a till, and made her sign a sales receipt for it. She was full time, and recently promoted her to merchandiser after 2 months. I am also an employee there and the insiders said that our scheduals for next week are under review. And the budget is under scrutiny. Shame shame the employees they are keeping are either old, extremely young, late, drunks or no show all the time. Quality has finally left the building. Shame on their management skills.

  15. Hey Robert, I grew up around Scotts Valley and I remember that tiny Gottschalks that was in the corner of that retail park. Sadly it’s closed–I’m not sure exactly how long they were able to hold on, but it’s some sort of dollar store now.

  16. 🙁 GOTTSCHALKS IS DONE!!!! Liquidations all around!!!! It was announced on March 31st that Gottschalks is going to be liquidated according to the good folks at Mall Hall of Fame and Wikipedia, even their website is down for “repairs” Oh no! What are we going to do? 🙁

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