HHGregg to Close 88 Stores, 3 Distribution Centers

March 3, 2017  by Larry Thomas in Business Strategy, Industry   

The store closings, which will be complete by mid-April, will leave the Indianapolis-based company with 132 stores.

"We are strategically exiting markets and stores that are not financially profitable for us," said Robert J. Riesbeck, president and CEO. "This is a proactive decision to streamline our store footprint in the markets where we have been, and will continue to be, important to our customers, vendor partners and communities.

"We feel strongly that the markets we will remain in are the right ones for our customers and our business model. Our team is dedicated to moving forward and being a profitable 132-store, multi-regional chain where we will continue to be a dominant force in appliances, electronics and home furnishings."

Once the inventory is sold from the affected stores and all merchandise has been delivered, the company said it will close distribution centers in Brandywine, Md., Miami and Philadelphia. The store and distribution center closings will result in the loss of about 1,500 jobs.

"The management team has worked tirelessly over the past year to return HHGregg to profitability," continued Riesbeck. "We have determined that the economics of the affected locations will not allow us to achieve our overall goal of becoming a profitable company again. After scrutinizing our real estate portfolio, we have identified a number of underperforming stores, as well as store locations that are no longer strong shopping destinations due to changes in the local retail shopping landscape."

Last month, the retailer said it had retained a financial adviser to explore strategic alternatives, and several media reports earlier this week said the company was preparing to file for Chapter 11 bankruptcy protection.

HHGregg has been plagued by declining sales and substantial net losses in recent quarters, and has been shifting its product mix away from lower-margin electronics and into higher-margin items such as furniture.

Its stock also was de-listed recently by the New York Stock Exchange because its market capitalization had fallen below $15 million for more than 30 consecutive trading days.

For a complete list of the stores to be closed, click here.