The latest victim of the retail apocalypse is Stage Stores, which received approval to liquidate from the U.S. Bankruptcy Court in Houston on Aug. 14.
Stage Stores owns the Gordman’s off-price discount stores at the Treasure Valley Marketplace in Nampa and at the Village at Meridian. It also owns the Bealls department stores in Blackfoot and Burley, which were in the middle of being converted to Gordmans stores. Stage Stores also had a third Gordmans located in Boise, which closed in 2017 when Stage bought Gordmans and saved it from liquidation.
The demise of Stage Stores was not at all a certainty given its performance in 2019, with an especially good third quarter and a successful partnership with Amazon. It made enough money to maintain its cash flow favorably and to pay down some of its debt from buying Gordmans. The Gordmans brand itself prospered under Stage Stores management as a cross between a department store and an off-price discounter, competing in the same market niche as TJ Maxx and the now-defunct Tuesday Morning chain.
The 2019 holiday season was not kind to Stage, which also owns Goody’s, Peebles and Palais Royal, all of which have more stores in the South and Southern Plains states than anywhere else. By February, the parent company was closing store locations and laying off staff as its less profitable locations. It had already started to convert all of its Bealls brand to Gordmans, whose hybrid off-price discounter format made more money than the traditional department store layout of Bealls.
Gordmans is one of the last survivors of the old department store chains that started more than a century ago. It was founded in Omaha as the Richman Gordman department store, named for its founders back before branding and marketer-designed business names became popular. The Gordmans chain spread throughout the Midwest before meeting the same rocky road brought on by e-commerce and the demise of Main Street-style shopping districts.
The story of Bealls is similar. It was founded in 1923 by the Beall brothers of Henderson, Texas. Their stores spread throughout Texas and then into the Deep South and Southwest. Bealls merged with Palais Royal, another Texas chain, in 1988 and soon after changed its name to Stage Stores.
Stage Stores snatched up Gordmans when it was on the liquidation chopping block in 2017 and revived the brand as an off-price discount store with a department store-feel, which was initially a good remake for an old brand, attracting new and younger customers.
The bad retail season during the 2019-2020 winter holidays hurt the company, and COVID-19 landed the firm in bankruptcy court in Texas in May. It filed for Chapter 11 with a plan to simultaneously liquidate if it couldn’t find a buyer. A deal to sell the business fell through in early August, and the court gave the company permission to implement its liquidation plan.
Before the mid-August hearing that approved liquidation, the company aggressively closed stores and liquidating inventory while staying on track to convert properties like the ones in Blackfoot and Burley to the profitable Gordmans format. As a result, Stage had paid down all but $32 million of its $236 million funded debt, along with $173 million in trade debt. Wells Fargo is its principal lender.
“It was a nice store,” said Kurt Hibbert, who is in charge of planning and business development for the City of Blackfoot, about the Bealls in Blackfoot. “It was the only place in Bingham County where you could buy a nice pair of men’s pants, which sure saved my bacon after a lunchtime spill. I would have had to drive to Idaho Falls otherwise. It’s a shame it’s going away — not just for nice clothes but as a store serving Blackfoot, which saved people the trip to Idaho Falls or Pocatello, both 30 miles down the road from here.”