In the last week, Bashas’ announced it was filing for bankruptcy, several months following a bankruptcy filing by Kohl’s Ranch.
Around town, businesses of all sizes are feeling the pinch of the recession.
In the past month, Fireside Espresso closed, along with the Small Cafe, who shut its doors a week after announcing it was switching to a lunch and dinner menu.
So far, however, it seems neither the Payson Bashas’ nor Kohl’s Ranch will close.
The Rim Country Regional Chamber of Commerce reports at least 23 businesses have closed since last fall. The good news is, 55 members joined the chamber, said chamber manager John Stanton.
Stanton said the Rim Country has been lucky, with everyone working hard to keep businesses open.
“You hope for best and prepare for the worst,” he said.
On Sunday, Bashas’ Supermarkets Inc., filed for Chapter 11 bankruptcy and announced 10 stores around the state, including several of the chain’s Food City locations, would close July 21.
In Chapter 11, a debtor usually proposes a plan of reorganization to keep its business alive and pay creditors over time, according to the U.S. courts Web site.
In most cases, the company remains in control of its business operations, but is subject to the oversight and jurisdiction of the court.
The Payson Bashas’ was not named as a store closing, but a Prescott and seven Valley stores were.
Locally, Bashas’ employs 70 and is a major contributor to the Payson Food Bank.
In its filing with the U.S. Bankruptcy Court in Phoenix, Bashas’ said it owes as much as $55 million in unsecured debt to more than 20,000 sellers. It also owes $110 million to a group of banks led by Wells Fargo and $84 million to a group of lenders led by Prudential Securities.
In early March, the Kohl’s Ranch parent company, ILX Resorts Inc., operator of 11 timeshare resorts in four U.S. states, announced it was also filing bankruptcy.
“Dramatic challenges in the economy and recent unanticipated reductions in our credit facilities caused by disruption and instability in the capital markets have necessitated that we seek reorganization protection to preserve resources for an orderly restructuring of the company,” said Joe Martori, chairman and CEO.
In its bankruptcy filing, ILX listed assets of between $10 million and $50 million, and a debt between $50 million and $100 million to between 50 and 99 creditors.
In ILX’s budget for July, Kohl’s Ranch is expected to bring in close to $150,000, but have more than $200,000 in expenses — a difference of more than $62,000.
The largest expense is food and beverage at a cost of $68,000.
Lauree Moffett, general manager at Kohl’s Ranch, did not return a call for comment as of press time, nor did the Bashas’ corporate office.