Lechmere
From Wikipedia, the free encyclopedia
| Lechmere, Inc. | |
 |
|
| Type | Electronics |
|---|---|
| Founded | 1913 |
| Headquarters | Woburn, Massachusetts |
| Industry | Retail |
| Products | Electronics, housewares, appliances, exercise equipment, footwear and music. |
| Website | None |
Lechmere (pronounced "leech-meer", sometimes described as Lechmere's) was a retail store chain in New England, which closed in 1997.
Contents |
[edit] History
Lechmere primarily focused on sales of electronics and appliances, including home goods and exercise equipment.
The original Lechmere Harness Shop in Lechmere Square (the store was named after the square) was bought by Abraham Cohen in 1913, who converted it into a tire store. Appliances were added in 1948. The second store opened in Dedham, Massachusetts in 1965, and Lechmere became a pioneering chain store in discount electronics.
Lechmere was also known for its Washington's Birthday sale where they featured full-size Table Talk cherry pies for 10 cents.
[edit] Sale To Dayton Hudson
In 1968, the Cohen family sold the stores to Dayton Hudson Corp. (who later changed their name to Target Corporation in 2000).
Lechmere languished under Dayton Hudson's corporate guidance until 1980, when C. George Scala was named CEO. Scala revamped the stores offerings, from an at times arcane and exotic selection of goods (from tires to snake meat), to a core grouping which included houseware, appliances, sporting goods, electronics, and music. Lechmere offered a wide and deep selection of these products. The stores carried telephones for example, ranging from the inexpensive to the top of the line, but also, offered customers choices in every price range.
Lechmere was almost a "Mall" within a Mall, with its home electronics department able to compete product for product with Tweeter, its houseware department offering as much, if not more, than Lechter's (a retailer who has since closed its doors), its footwear department could compete with Foot Locker, and its music department was as large and varied as Recordtown's (another retailing ghost).
"Our customers don't want cheap steak, they want steak cheap!" was a familiar saying. While Lechmere did not offer "rock bottom" pricing, it did offer competitive pricing, a no hassle return policy, very knowledgable sales associates, colorful and informative signing in store, as well as its famous Lechmere Sunday circular. The stores were large, clean, bright, and uncluttered.
This was to be the heyday of the company, which also saw an increase in retailing excellence with the addition of Frank G. Fellicella as Executive Vice President of Stores, who would later become CEO of a large home improvement company.
[edit] Split From Dayton Hudson
In 1989, the company's management, with the help of a local investment firm, Berkshire Partners, and the Boston-based Mall developers Steve Karp and Steve Wiener, bought the chain from Dayton Hudson's. The sale was the second largest leveraged buyout of the year. Lechmere's 29 stores fetched only book value of $234 million, much less than early estimates of $350 million.
A result of the sale was the closing of the southeast region, and the stores located there. The cost of running essentially two companies (one in New England, and one in the deep southeast) was too costly for the now privately owned venture.
Then, in the early 1990s, C. George Scala retired and was replaced by J. Kent Flemmerfelt, a veteran Sears merchant. Things started to turn sour--with several rounds of layoffs.
[edit] Montgomery Ward
In March 1994 Berkshire Partners sold Lechmere to Montgomery Ward Holdings in a more than $200 million deal. Berkshire acquired the business in 1989 and according to Berkshire Partner Richard Lubin, the firm initially wanted to take the business public.
He said at the time, "As we learned about the Montgomery Ward strategy, we realized this was a buyer that could make a very attractive offer, an offer that we thought was above what we viewed our IPO offering would have been." In 1993, Lechmere had sales of more than $800 million, through 24 stores in the New England area.
At the time of purchase, Lechmere had 28 stores and grew to 33 with the introduction of HomeImage by Lechmere stores that opened in August of 1996.
However, it wasn't long after that the business press was calling Montgomery Ward's purchase of Lechmere a disaster, and less than five years after the acquisition, the company was forced to liquidate Lechmere's assets. In 2000, Montgomery Ward itself was forced into bankruptcy protection amid competition from the likes of Wal-Mart and Target, and the company eventually shuttered its stores and closed after 128 years in business.
[edit] Closure
On August 1, 1997, Montgomery Ward announced that all Lechmere stores were to be closed as part of their bankruptcy reorganization. At the time of the chain's closing, 27 stores remained open, including 20 in New England, 12 of which were in Massachusetts. All six HomeImage by Lechmere were also closed at that time.
November 8, 1997 was the last day of business for all locations.
