Zayre88 - Rich's

Headquarters: Salem, MA
President: Howard Rich
Employees: 2,300 (1996)
Stores: 30
Slogan: unknown
Founded: 1962
Closed: 1997

COMMENTARY:

Rich's was a New England chain of discount department stores. Its store size was somewhere between Ames and Bradlees. Many Rich's stores were modern and located in new or renovated buildings. Rich's was a family-owned business, and was among the smallest chains in New England with Mars, Globe, and Stuart's.

The Auburn, Maine store was among the last ones to be opened by Rich's. The store was build from the ground up and it opened in 1990. The store was large and bright and showcased the latest design of Rich's. In Waterville,ME, the store was also renovated inside and out. These two stores had a the same modern storefront design, the latest new concept from the chain. The future of the chain looked bright. Back then, a city like Waterville had a K-mart, an Ames and a Rich's and all appeared to thrive.

Rich's maintained stores and upgraded its company systems to stay competitive. Rich's had a modern distribution center located in Haverhill, MA. The major problem for Rich's was tough competition from Walmart and other discounters which caused a decrease in sales and profit. As part of the irony, the former Rich's in Gilford, NH was replaced by Walmart in 1998.

If you want to see what a Rich's store looked like, go to the former Rich's at the Auburn Plaza. It was one of the biggest and newest Rich's store. Today, they divided the store in three and one third is a Big Lots. At the back of the store, they added a new wall to create a larger backstore space. If you look into the backstore doors, you will see the "real" backstore wall from Rich's with the "real" Rich's backstore doors. Inside that new stock area, you'll see original Rich's lettering up on the wall with big stripes showing "Rugs" "Furniture" ... from the original Rich's in-store signage.

OVERVIEW:

Founded in 1962, Rich's was a small New England chain whose employees often stayed for their entire careers. Rich's was founded by Jerry Rich, his son Howard later became President of the company. In 1983, Rich's opened a store in Bangor in the former space occupied by Woolco. In 1985, the company came close to open a store in Rockland, Maine. The official announcement was made, construction had begun and then plans were cancelled. In 1986, the company opened a new store in Manchester NH in a former Lord's Department Store. Another store was added in 1990 in Auburn, Maine at a new shopping center.

Rich's had sales of $240 million in 1994. In May 1995, Rich's opened it's 28th store in Milford MA, back then the fourth in Central Massachusetts. In March 1996, the chain, which had 2,300 employees, filed for bankruptcy protection. Before the filing, the company closed two Maine stores, Auburn and Calais. In May 1996, Rich's announced it would close the Nashua NH location which was operating since 1977. On October 9, the company announced the closing of three New Hampshire stores by the end of the year (Portsmouth, Concord and Rochester). The closing left Rich's with 19 stores in New England, including five New Hampshire stores in Gilford, Gorham, Keene, Manchester and West Lebanon.

Stung by lower-than-projected Christmas sales, continued competition from bigger discounters and not being able to pay off its creditors, the family that runs Rich's Department Stores Inc. has chosen to close the chain forever after Christmas 1996. 1,400 employees lost their jobs when the remaining 20 stores closed early in 1997.

«Weak sales, particularly in the last eight days, have led to the reluctant conclusion that the business will not be able to turn around,» Rich's president Howard Rich said. «The creditors made it clear that they appreciated the very strong efforts the company made, but that they felt their position was eroding.»

Mr. Rich cited fierce competition among discount department stores as the primary reason for weak holiday sales, which fell $1 million below projections last week alone. «We couldn't withstand the trend in the discount industry,» Mr. Rich said. Richard Levine, a Boston attorney representing Rich's, said the company would file a liquidation proposal as soon as possible, and plans to sell off the remaining inventory would be made next week.

«I feel very sorry for the Rich family; I feel very sorry that small discounters are having such a hard time competing,» said William Costa, a partner in the Green Mountain Mall in St. Johnsbury, VT., where Rich's was the biggest tenant. «It's not a big chain; it's a family-owned business and it's just very unfortunate this happened to them.»