Walker-Scott, losing money and unable to compete against larger, better-financed chains, will close its six San Diego clothing stores by the end of January, 1987, the company said Friday.
The company’s stores in Escondido and Palm Springs will stay open, the only remaining vestiges of a longstanding San Diego public company.
“Business hasn’t been too good,” judged Chairman Harold Kapelovitz, who pinned the blame on “too many (competing) stores in the San Diego area. We . . . just couldn’t compete.”
The stores, he said, were “losing money--the loss wasn’t so great as the fact that we were losing ground” to competing department store chains.
Walker-Scott was bought out by Desmond’s & Associates, which is headed by Kapelovitz, and taken private last year. Walker-Scott shareholders were paid $12 per share--or about 74% of the company’s per-share book value in a deal valued at about $4.9 million.
Kapelovitz is president of Desmond’s Inc., operators of a well-known chain of nine retail clothing stores in Los Angeles. Desmond’s is the principal shareholder of Desmond’s & Associates.
When Desmond’s took over Walker-Scott, “our analysis of it was that the best thing to happen would be to open some new stores (and) eventually sell it as a viable, going company,” Kapelovitz said. “But we also knew that . . . if we closed it we wouldn’t lose any money.”
Leases on the six closing stores--in Clairemont, College Grove, National City, San Carlos, Solana Beach and Pacific Beach--have between seven and 25 years remaining, Kapelovitz said. Those leases will be offered for sale.
About 200 employees will lose their jobs, with 100 workers staying on in the Escondido and Palm Springs stores, according to President Leonard Villavicencio.
The status of Walker-Scott’s 60,000-square-foot headquarters and warehouse off Morena Boulevard, as well as 25 corporate employees and about 40 warehouse workers, remains uncertain, he added.
A liquidation sale, with items offered from 20% to 70% off, will begin Thursday, Villavicencio said.