“In our continuing efforts to make the Powell Merc profitable, the board has determined major changes are needed in order to provide sustainability for our community clothing store,” the Merc Board of Directors wrote in a letter to stockholders on Friday.
The board also plans to cut operating expenses and reduce its staff through attrition, by not replacing employees who leave.
“With online shopping, the retail climate has changed so much,” said Sharon Earhart, president of the board. “It’s a different world.”
The transition to one building will begin this month, Earhart said, and it’s unclear how long it will take. A doorway that connects the two buildings will be closed off.
Earhart said the board’s decision was unanimous.
The Bent Street store will continue to sell a wide range of clothing and shoes for all ages, Earhart said.
“We are determined in our commitment and efforts to keep the Powell Merc profitable and provide a retail clothing store in our community,” the board’s letter read. “We are optimistic that with the support of our community, and the aforementioned actions, that the Powell Merc will be a fixture on Bent Street for many more years to come.”
The Merc has continued to look for ways to watch its overall expenditures and tighten up inventory purchases, Earhart said.
In the last fiscal year, operating expenses were cut by 160 percent, Earhart said. The bulk of those cuts were made by combining the manager’s and buyer’s responsibilities. Manager Lesli Spencer took over the buyer’s position, saving that salary. She also oversees daily bookkeeping.
“Lesli has done a wonderful job for us,” Earhart said. “She’s very dedicated to our store.”
The Merc owns the two buildings, which, combined, provide about 14,000 square feet of retail space. Closing the south building will cut the square footage to 7,000.
Using a $185,000 Community Development Block Grant through the state in 2006, Target Powell Valley purchased the north building, which previously housed Skyline Drug. The Merc later acquired the property.
The Merc opened in the south building in 2002 after local residents came together to create the store. Shares were sold for $500 apiece to local stockholders, raising a base of more than $400,000 to get the store off the ground. Since its opening, other community-owned stores modeled after The Merc have popped up. Most recently, a Merc sister store opened in New York in 2011.