No more good stuff cheap, no more circulars: Building 19 going out of business

First Anthony's Pier 4, then the Hilltop, now Building 19. Chapter 11 Cases reports the iconic chain for cheap New Englanders has filed for Chapter 11 - and plans to liquidate, rather than just reorganize:

The advent of internet shopping has dramatically altered the retail landscape, particularly for so-called “big box” stores such as are operated by Building 19. As a result, Building 19s’ respective sales have declined. The decline in sales and the resulting losses, among other things, eroded Building 19’s working capital. Without sufficient working capital, Building 19 was left with little flexibility to make inventory purchases. Since much of Building 19’s inventory consists of surplus, salvage goods, overstocks, closeouts and irregulars that become available erratically, Building 19’s business model relies, in part, on having sufficient working capital on hand to make erratic inventory purchases. Building 19’s lack of working capital impaired its ability to capitalize on erratic opportunities to purchase inventory. The combined impact of declining sales, continuing losses and a lack of working capital forced the Debtors to file for Chapter 11 bankruptcy protection.

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      Comments

      That's a lot of square footage

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      Ten very large stores hitting the market, that'll cause a lot of disruption. I think there are still a few Linens 'n Things & even Circuit City spaces still left. Though Bldg 19 never went for the better locations.

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      I thought Building 19 went

      I thought Building 19 went out of business around a decade ago, or did they just consolidate?

      Gotta say, I went to one Building 19 once, and it was a very long time ago. Definitely NOT my scene. I don't understand how online shopping cut into their business, because to me, the entire store was one big, hit-or-miss junk shop. When I shop online, I know what I need and go out to get it.

      ETA: They also reminded me a lot of Grossman's. Were they the same company?

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      Pretty sure that they weren't

      Pretty sure that they weren't the same company as Grossman's, although Grossman's also had cartoony ads in the newspapers.

      I agree that they don't seem to have a lot of crossover with the online market. I loved them when I was in my 20s, great place to buy cheap stuff like mismatched coffee mugs with random company logos from across the country. It was a real "Whatever we have this week" sort of place.

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      Why would OSJL want to buy them?

      Building 19 has a lot of crap that would need to be liquidated if they were bought out by someone more upscale (God help me for describing OSJL that way), none of the locations I've ever seen were exactly "choice" real estate, and a ten store expansion for another local/regional chain would be a huge investment in tsuris.

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      This is way TOO much! My

      By on

      This is way TOO much! My heart is broken. Every rug in my house is from Building 19. Lots of other assorted goods- furniture, kitchenware, shoes, clothing, books were bought there, over the years, for me and my family. I don't generally like shopping unless it's bargain shopping. The pleasure was all in the hunt. No Filene's Basement, No Building 19! Oh what sad news!

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      I am heartbroken! Where will I get my Good Stuff Cheap?!

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      I've been going to Bldg 19 for the last 30 years (mostly Building 19 3/4, the Norwood location). I have certainly saved thousands of dollars shopping there. Yes, it's rough around the edges and it's easy to understand why some of the goods are 'surplus' - but oh, the (not-too) hidden gems! To get the most out of a trip you need to have a discerning eye, some self-control, and an ability to withstand bad puns, but the bargains can be truly amazing. (in comparison, Ocean State Job Lot may have bigger stores, but the range of stock is much more limited and the prices are very nearly retail! I rarely set foot in an OSJL).

      Mad respect for Jerry and his family - classic American success story. Also, the people working there are good folk. I hope they all manage to land on their feet. God bless them all.

      This is a sad sad day, - thrifty yankees are losing a truly great resource.

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      Spag's

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      I'm sad because they ruined Spag's in Shrewsbury. Now there will be nothing left of them.

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      Not Spag's

      The big box stores killed Spag's, not Bldg 19. Spag's was the original big box store.

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      Building 19 was in charge for

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      Building 19 was in charge for, what, two years, when Spag's finally closed. I don't think they're directly responsible for the store's downfall, though. Anyone who bought it after the Borgatti family sold it couldn't have run it the same.

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      Oh, no!

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      Oh, no, Building 19! How will we do without all that crap you sell? Where else will I be able to buy a dozen packages of slightly burnt underwear for $9.97?

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      How do you liquidate a liquidator?

      Since Bldg 19 buys distressed merchandise as a liquidator, who liquidates a liquidator? Makes your head spin a bit. ;-)

      Nifty tidbit: The guy that did all the drawings for the ads years ago was an old math teacher of mine. I doubt it's the same guy now - they've been around for a long time.

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      saw it coming

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      I have worked for this company until recently. The owners son and ceo has run it into the ground and has constantly lied to his employees by reassuring good hard working people that business was improving just to squeeze out as much labor out of them as he can. Bill Elovitz lied to his faithful, loyal employees. Shame on him. He owns 7 homes some in other countries but expects his workers to do tooo much for little money. Even as he was planning to file for bankruptcy, he was reassuring his workers that business was improoving. Just so he had people to sell his merchandise and make him more money. Why not sell one of your seven mansions to save the business Billy?

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      Secured creditor

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      I'm not personally familiar with any of this, but the Boston Business Journal's post on the subject says that William Elovitz is one of the largest secured creditors of the enterprise, meaning that he will get paid off before other, unsecured creditors -- such as the city of New Bedford, which presumably is owed property taxes on Building 19's main warehouse.

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      It depends

      They are only secured if a lien has been entered on the property. It takes a while before a city or town will do that, because they would rather that you pay up.

      So, the answer is no, liens do not happen automatically so they may not be so secured.

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