The recently downsized Bonwit Teller specialty department store in Walden Galleria will close its doors for good by year's end.
The decision to permanently close the upscale store comes on the heels of this summer's elimination of an upper level sales floor which reduced the total space to about 30,000 square feet from 63,000 square feet. That downsizing was portrayed by Bonwit Teller Chief Executive Officer Murray Daitchman as being part of an effort to create "a more efficient, more compelling store." However, the move was also seen as a way to reduce pressure on the two-store chain's bottom line.
Rumors have persisted for the past few years that the trendy store has been on shaky financial ground, burdened not only by the overhead of operating the huge mall location, but also by the pressures of the extremely competitive women's apparel market.
Those fiscal problems became a very public matter in late June when Niagara Mohawk Power Corp.
pulled the plug on the retailer's electric service in the middle of the business day. Service to the store was interrupted for 6 1/2 hours on June 25 while Bonwit Teller executives negotiated with the utility to resolve unpaid bills dating back to 1994.
A Niagara Mohawk spokesperson confirmed the retailer was also in arrears on a mountain of electric bills for its store in the Carousel Mall in Syracuse. The Syracuse store reportedly will remain open for the foreseeable future.
Roger Leous, manager of the Buffalo store, confirmed the store's 40 full- and part-time workers have been told they will be out of work after the upcoming holiday season. Those employees will be eligible to receive a severance package based on their tenure with the company, Leous said.
Store customers have been greeted by a barrage of "Blow-Out Sale" signs for the past week, with discounts ranging from 20 percent to 75 percent on just about everything in the store, including current-season apparel.
"I was wondering what was going on," said Mara Glickman, a St. Catharine's resident, who makes a frequent trips to Cheektowaga to shop the store.
"It has that 'going out of business look' with all the sales racks. I had a feeling this wasn't just another sale," she said. "It's too bad, they had things no one else carried. It was a special store."
The Buffalo and Syracuse Bonwit stores were purchased by Pyramid Cos., the owner of Walden Galleria and Carousel Mall, when the stores' parent company, L.J. Hooker, filed bankruptcy in 1990. The Pyramid-owned stores are now the last of what had been a New York City-based, 16-store chain operating Bonwit Teller stores in 10 states.
At the time of purchase, Pyramid partner Peter Steingraber described the purchase as a "natural fit" for the mall development company, which was donning a retailer hat for the first time.
"Bonwit is a great store, a great name and a great draw for customers," Steingraber said.
But even as the acquisition was announced, several retail observers questioned whether Pyramid was taking a risk in stepping outside the development arena.
Pyramid's signing of anchor Lord & Taylor in Galleria also may have served to upstage smaller Bonwit Teller.
The local store has been dogged by the lack of a clear identity nearly from the onset of Pyramid ownership. Local retail observers said shoppers found the independently operated store to be out of step with the old Bonwit. Meanwhile, new customers had a tough time understanding an apparel assortment that has ranged from $5,000 evening dresses to a hodgepodge of drastically discounted merchandise.