Retailer Montgomery Ward Inc., which has a Wards department store at Regency Mall, announced Thursday its 250 stores will close as part of a Chapter 11 bankruptcy filing. The move will leave dozens of local employees out of work and deal a crushing blow to the already struggling Regency Mall.
A 4:30 p.m. teleconference call with store management confirmed the bad news.
General Electric Co.'s GE Capital Unit, owner of the Chicago-based retailer, said it was pulling support for the chain because of disappointing holiday sales that aggravated an already dismal financial picture.
"Sadly, today's action is unavoidable," Montgomery Ward CEO Roger Goddu said of the chain's divestment. The retailer has 37,000 employees in 30 states.
A store representative said local manager Mark Boespflug was not in the store Thursday. Attempts to reach him at home were unsuccessful, and employees were instructed to refer calls to Wards' corporate media relations department, which also did not return calls immediately.
Wards, the last remaining Regency anchor, has been at the mall for more than 21 years, hanging on when other key stores, such as Belk and J.B. White, either closed or pulled out.
"(Wards) brings traffic to the mall," said Diane Faircloth, manager of Regency Mall, which is located at the intersection of Gordon Highway and Deans Bridge Road. She conceded that the store's absence will have a negative effect, but emphasized, "If they shut their doors, it does not mean the mall is closed."
But the mall has been struggling to retain tenants for a number of years as the development of more affluent subdivisions has moved west.
Regency also has undergone changes in ownership since the DeBartolo Corp. opened it in 1978. Current owner Haywood Whichard declined to comment Thursday on the Wards closing, according to Ms. Faircloth.
Although representatives were not available to confirm the exact number of local employees affected, a corporate source in 1997 stated the store employee count was about 100. Mayor Bob Young said his office gets copies when notices of layoffs are filed, and he doesn't recall any for Wards, so that figure could still be accurate.
Wards, regardless, is the largest employer in the mall. The 138,000-square-foot store has numerous departments and sells clothing, jewelry, appliances and furniture, among other goods.
The store's last day of business has not been confirmed, but a GE Capital Services spokesman said the chain would have an "orderly winding down."
Wards closed 48 stores in 1997 as part of a previous Chapter 11 reorganization. It emerged from the reorganization in August 1999 with hopes of revamping its stores and its image.
But retail analysts say the chain failed to communicate persuasive reasons to shop Wards over other retail stores.
"Wards has not established themselves as anything distinctive in the marketplace," said George Whalin, president of California-based Retail Management Consultants. "There's just no reason to go there - unless maybe they're the closest store to your house."
Founded in 1872, Montgomery Ward pioneered mail-order catalogs when it came out with a single sheet of dry-good items for sale. It was the first U.S. mail-order house to sell general merchandise.
The first store opened in Plymouth, Ind., in 1926.
Associated Press reports were used in this article.
Reach Eric Williamson at (706) 828-3904.