Ernst Calling It Quits; Stores Close In January Liquidation Of 103-Year-Old Business To Leave 150 Jobless

Ernst Home Center Inc. is calling it quits after struggling to reorganize under bankruptcy protection.

The 103-year-old home improvement chain will liquidate its assets beginning Dec. 1 and close all its stores in mid-January, pending Bankruptcy Court approval.

That means good deals for shoppers while discounted merchandise lasts. But it’s bad news for the roughly 150 full- and part-time Ernst employees in the region.

Ernst has five stores left in the area - three in Spokane and two in North Idaho. The Spokane Valley store was closed in July when Ernst filed for Chapter 11 bankruptcy protection.

The Valley location was the Seattle-based chain’s first store in the Spokane area, opening in 1969. It was one of 33 closed as Ernst reduced its stores from 86 to 53.

In its September earnings report, Ernst reported losses of $51.6 million for the quarter. The company lost $120 million on sales of $343.3 million in the first nine months of the year compared with a loss of $2.2 million on sales of $419.3 million a year earlier.

Spokane-based Jensen Distribution Services has been Ernst’s biggest supplier since 1981. Jensen has supplied the company on only a prepay basis since mid-October, said Mike Jensen, president.

“It’s a sad day,” Jensen said Tuesday. “They’ve been a good customer for a long time.”

Employees at the South Hill Ernst said the liquidation plan was explained at a meeting Tuesday morning. Many workers were told they’d keep their jobs during liquidation and would be offered severance packages after that.

“It is the company’s intent to implement” the severance program, said Jim Fox, Ernst’s spokesman in Seattle.

The liquidation was no surprise to some longtime employees.

“I’ve worked for the store long enough,” said Paulette Hill, a 10-year full-time employee. “I knew we were in trouble.”

Hill is thinking about applying for a job at a grocery store near her home. Even though her husband recently was laid off from his seasonal job, Hill remains upbeat, worrying more about the single parents who work at Ernst than herself.

“It was a good company to work for that cared about their people,” she said.

Ernst also owns the buildings at Manito Shopping Center and leases the land from the Walther family, the property’s longtime owner. The shopping center houses Lamonts, PayLess Drug Store and Super 1 Foods.

Those buildings likely will be up for sale soon as part of the asset liquidation.

Ernst used to have a store at Manito but closed it in 1989 to open a store off 29th Avenue at Lincoln Heights.

Ernst also operates a store at Shadle Center, which is currently for sale. It’s unclear what effect the liquidation will have on the Shadle sale, said Dave Black, chief executive of Tomlinson Black Group of Cos., the property manager.

Black also has an interest in Black Enterprises, which owns the Lincoln Heights Ernst building. “When the stock and assets are liquidated, hopefully another chain will come in and buy them and take over those leases,” he said.

Few customers were surprised to hear of Ernst’s demise. Most have noticed the paucity of merchandise on store shelves. Many attributed Ernst’s decline to tough competition with larger, warehouse-style discount stores such as Eagle Hardware and Garden.

“The main thing at Eagle is they have such an abundance of everything, that’s why these people can’t compete,” said Stacy Mattson, who stopped by the South Hill Ernst on Tuesday to return a battery. “I think Eagle and places like that - nothing against them - are taking the business.”

In Coeur d’Alene, Eagle’s presence, or lack thereof, also was noted.

“It’s too bad,” Jandi Dunlap of Post Falls said of Ernst’s demise. “We don’t have that much selection out here in Idaho. Everyone else’s prices were too high. What we need out here is an Eagle Hardware or something like it.”

, DataTimes ILLUSTRATION: Color photo

MEMO: This sidebar appeared with the story: WHERE ARE THEY? Ernst’s Spokane stores are at Lincoln Heights, Shadle Center and Northpointe Plaza. The Idaho stores operate in Moscow and next to the Silver Lake Mall in Coeur d’Alene.

The following fields overflowed: BYLINE = Alison Boggs Staff writer Staff writer Eric Torbenson contributed to this story.