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ST. LOUIS - Following weeks of discussions with union leaders, city officials, and developers, Schnuck Markets decided it will shutter its East St. Louis, Ill. store at 2511 State St. on Saturday, Oct. 9. The 32,490-square-foot unit was acquired by Schnucks as part of its acquisition of National Supermarkets in 1995.
All 103 store associates will be offered transfers to similar positions with comparable wages and benefits in the chain's other stores, according to company officials, who note that those employees who opt not to be transferred will be paid for all earned vacation and personal days and, if eligible, will receive extended health care and pension coverage for three months.
Long-time Schnucks' store manager Ken Hall will receive a new assignment to a management position with another of the company's metro east locations.
In a statement chairman and c.e.o. Craig D. Schnuck said: "Although there were good-faith gestures all the way around, we just couldn't get it all to come together in a way that would justify continued operation. We appreciate our loyal customers in East St. Louis. They were the focus of our efforts over the past several months as we researched options that would enable us to keep the store open."
However, Schnuck said the already ailing store suffered a one-two punch when city officials granted tax relief to subsidize developments for nonunion competitors Walgreens (June 1999) and Sav-A-Lot (April 2000).
"While the decision was well intended and designed to bring more business into the area, this action caused sales declines that pushed our store into major operating losses. We must now consolidate our east-side operations," Schnuck said. "Ken Hall and his store team have served the community exceptionally well. However, given our present situation, we all know that there is no way the store can survive. There are simply not enough customers to go around."
Following the expiration of the store's lease on Aug. 14, Schnuck said the chain has been operating month to month, "in order to buy time to research options. All along we emphasized it was imperative that we get relief from burdensome lease terms and labor costs that greatly exceed those of the area's nonunion retailers."
To date, neither city nor state officials have offered requested assistance. Further, while leaders of the United Food and Commercial Workers (UFCW) and Schnucks have reportedly discussed options for relief, no agreement has been reached. As such, Schnuck said while the family-held chain appreciates, "the attention everyone has given to this effort. . .it was imperative that we get relief in several different areas. Unfortunately we weren't able to make everything happen."
Pointing to increasingly heavy competition, rising labor costs, and a sluggish economy, Schnuck said the 101-store chain has been forced "to make tough decisions in order to remain competitive. Schnucks encountered similar situations last year when leasehold interests expired at two other stores.
"Closing a store is a very difficult aspect of our business, and we don't make these decisions lightly. However, our focus must remain on keeping prices down for our customers. In order to do that and to preserve our business for the future, we must operate as efficiently as possible," said Schnuck.