FORT COLLINS, Colo. -- Steele's Markets here, after 60 years in business, was scheduled to close its two remaining stores yesterday.
The company recently underwent a reorganization as part of Chapter 11 bankruptcy proceedings, but could not shake off the burden of millions in debt incurred after the construction of a new store, according to Russell Kates, president of the family-owned chain.
"The main cause was the fact that we built the $10 million new store in Fort Collins, and shortly after it opened, the city closed off the street for construction," he said. "We went from having revenues of $390,000 per week to weekly sales of $190,000.
"It really killed our momentum, and we couldn't recover. We lost about $4 million because of those events. It was just a string of bad luck that spelled our demise."
The company also cited increased competition from larger chains like Safeway, Pleasanton, Calif., and Wal-Mart Stores, Bentonville, Ark., which opened a supercenter in Fort Collins this fall.
"There are 15 major grocery stores in Fort Collins, a town with roughly 125,000 people," Kates said. "The competition is tremendous, especially with a Wal-Mart supercenter eating up supermarket business."
The company closed four stores over the past year as part of the reorganization plan. One of the remaining two stores was here, the other in Niwot, Colo.
