It seems like just last year that the Gottschalks department store chain was being liquidated as part of bankruptcy proceedings. Today, all that is in the past as former executives with the company are back trying to recapture past glory under the banner of a similar but not identically-named business.
Gottschalk (s missing) by Joe Levy is a planned department store chain that will be operated by the former chairman and chief executive of Gottschalks, Joe Levy. The old company's former vice president and general merchandise manager Robert Wiser will serve as CEO of the new retailer. Former CFO Robert Lawson will serve in the same capacity with Gottschalk by Joe Levy.
The new business, which will be headquartered in the Fresno, CA area, plans to open its first store in November of this year somewhere in the state's Central Valley region. Future stores are planned in many of the same areas where the former Gottschalks operated locations.
"The object here is to bring the public what Gottschalks used to be," Mr. Levy said at a press conference. "We want to provide good customer service, high-quality fashions and merchandise at a very competitive price... Since Gottschalks closed, there's a large void in that type of merchandising."
Mr. Lawson said the company's strategy is to open stores in "secondary markets in California because we could offer branded merchandise, such as name brand cosmetics, that they couldn't get elsewhere."
The former and current CFO believes the time for building the chain is now, with prime locations available at attractive lease rates. Gottschalk by Joe Levy is looking to open single-floor locations between 40,000 and 100,000 square-feet in shopping center locations.
James Tenser, principal with VSN Strategies and a member of the RetailWire BrainTrust, told the Modesto Bee that the new company will face challenges.
"Gottschalks was a great name, one a lot of people remember," he said while adding "the department-store concept isn't as relevant as it once was."
"The best-positioned department stores are the ones who are the most promotional, and Gottschalks had a good track record of that," Jeff Green of Jeff Green Partners told the Bee. "If Levy can keep the debt low, keep his store count low and sell promotional-priced merchandise, I think he can actually find a niche for himself competing with stores like Macy's."
Discussion Questions: What do you think are the prospects for Gottschalk by Joe Levy? Will the Gottschalk name help or hurt the new venture? What challenges will the retailer have to address to avoid the same fate as Gottschalks?