First Family Group to Close 13 Golden Bear Stores in Southland

Pummeled by larger consumer electronics retailers such as Circuit City Stores and Federated Group, an Akron, Ohio, company announced Tuesday that it is closing its 13 Golden Bear Home and Sport Centers in Southern California because of poor sales.

“Unit sales volume, gross margins and net margins are well below our corporate expectations,” Theodore R. Princehorn, president of First Family Group, said in a prepared statement. “We do not anticipate that this situation will change in any reasonable amount of time.”

First Family Group’s local Golden Bear home appliance and video subsidiary becomes the second major casualty in the hotly competitive Southern California consumer electronics market since the entry of Richmond, Va.-based Circuit City Stores touched off an aggressive sales war with market leader Federated Group in February, 1985.

Pacific Stereo Corp., an Emeryville, Calif., consumer electronics concern with 84 stores in California, Illinois, Washington and Texas, closed and began selling store fixtures last month after filing for protection from its creditors under Chapter 11 of the U.S. Bankruptcy Code last May.

The announcement, which comes about 17 months after First Family acquired the stores for an undisclosed sum in June, 1985, will affect 185 workers, according to First Family Group spokesman Jim Ansley.

The stores, originally called ATA Superstores, were converted in May to the Golden Bear name as part of a retailing venture by First Family with professional golfer Jack Nicklaus.

Ansley said most workers will be offered severance pay and let go by the end of the year, although some employees will be transferred back to the company’s Akron headquarters. The remaining inventory at the 13 stores will also be sent back to Akron, and First Family will attempt to renegotiate its store leases or subleases.

In September, First Family reported record sales for its fiscal year ended June 30 but only a small increase in earnings for the year. Earnings did not keep pace with sales, Princehorn said, because of the cost of converting the California ATA stores to Golden Bear.

Getting the California stores to operate efficiently, he said at the time, was “a significant challenge that we addressed and overcame.”

He also noted then that “price competition in California was intense” in the fourth quarter of the company’s 1986 fiscal year when the company reported a $58,000 loss, compared to earnings of $706,000 in the last quarter of the previous year.

First Family Group is a major speciality retailer of home appliance and consumer electronics products in Ohio. The company operates 26 retail stores, including 19 Home Centers, three Golden Bear Home and Sport Centers and four Champion Appliance and Television Rental Centers in the Akron, Cleveland, Columbus, Canto, Mansfield and Wooster areas of Ohio.

The closing of its 13 California stores forced First Family to record a one-time net charge of $2.5 million against earnings for the first quarter of its 1987 fiscal year, which ended Sept. 30, the company said.

The charge resulted in a loss of $2.5 million, compared to earnings of $687,142 during the first quarter of the year before, the company said. First Family’s sales, including the 13 California stores, were $18.9 million for the first quarter of the company’s 1987 fiscal year, compared to $16.7 million the year before.