Plass Appliance shutting down all stores
By H. Lee Murphy
Plass Appliance & Furniture Inc., once one of metro Chicago's bigger appliance retailers, is liquidating and will close its five remaining stores by summer.
The 75-year-old, family-owned Plass, based in Bloomingdale, is the latest casualty in a housing-dependent industry that has seen an array of retail names ranging from national chains such as Circuit City Stores Inc. to local outfits such as Wehrli Appliances in Naperville and Soukup's in Geneva go under since the start of the recession five years ago.
Plass' remaining stores are in Naperville, Bloomingdale, Geneva, Elmhurst and Northbrook. The company already is marketing the properties, ranging from 5,000 to 30,000 square feet, for sale. Dale Plass, 55, said he and his brother Harold, 65, a co-owner and CEO, are concentrating their efforts on building a second family business, DeSears Appliance &TV, in Bradenton, Fla. But he said they have no plans to expand that company to other states.
At its peak in the 1990s, Plass had 10 stores and annual revenue of nearly $50 million, ranking it No. 34 among all appliance retailers in the U.S., said Dale Plass, the firm's president. Sales last year were less than $10 million, he said. Stores in Oak Lawn, Tinley Park, Bourbonnais, Burbank and on Chicago's North Side were closed in recent years as Plass downsized.
There are no plans to file for bankruptcy protection as the chain commences going-out-of-business sales. We felt now was the right time to transition out of the business, Mr. Plass said in an interview.
He blames the battered housing market, along with the impact of newer competitors such as Indianapolis-based H.H. Gregg Inc. that have entered the market, for most of his firm's problems. The Chicago-area housing market went from a 30-year average of 15,000 new-home starts a year to as little as 1,000 starts a year," he said. "Things have moved up in the past year, but we're still down 80 percent from where housing ought to be.
Doug Samuels, who owns a single-location retailer called Young's Appliances Inc. in Glen Ellyn (founded in 1931), said he isn't surprised by Plass' shutdown. Many small store appliance retailers have simply gotten tired of the pressure of competition, he said, pointing to the growing sales by mega-rival Abt Inc. in Glenview as another threat to small independents. Abt is the 800-pound gorilla here. They have an awesome store with all the best products and very sharp pricing. They've taken business away from Plass and us and a lot of others.
Abt is not the only growing appliance source for suburban Chicago shoppers. Both Messrs. Plass and Samuels agree that consumers increasingly have attempted to bypass local sales taxes by shopping online. High Chicago-area sales taxes have killed us, Mr. Plass said. For a time, the firm cleared its sales through an address in exurban Channahon in a bid to reduce its tax liability.
Copyright © 2013 Crain Communications, Inc.