LUBBOCK, TX (KCBD) - Owners of a popular furniture store with two locations in Lubbock have file for bankruptcy. Lack's Stores, Inc. filed for Chapter 11 bankruptcy protection Monday. Owners say their lenders no longer wish to work with them, and they've demanded repayment.
Lack's Stores, Inc. released this statement:
Lack's Stores, Inc. announced today that it will file for protection under Chapter 11 of Federal Bankruptcy Code. The company has financed its customers' accounts throughout its entire history and has borrowed funds from banks and other lenders over the years to finance those receivables. The lenders have informed the company that they no longer wish to lend money on consumer receivables. They have demanded repayment of the loan and this has resulted in the necessity of this current action, notwithstanding our company's strength, viability, and profitability.
The company has been in business for 73 years. Lack's was founded in 1938 by Dave and Rebecca Lack when they purchased a 900-sq. foot auto supply store in Beeville, TX. In 1941, they purchased a store in Victoria and the family moved to that city. Victoria still serves as the company's headquarters. During World War II, the company had a difficult time getting products made of rubber and steel because of the war effort, and added furniture as a way to boost its sales. This was a successful move and furniture--and later appliances and electronics--became part of the company's product mix. In the 1970's, auto supplies and other small items were phased out.
Over the years, the company estimates that it has paid almost a billion dollars in salaries and wages to its associates. In addition, it has provided revenues for numerous local service and product suppliers, and has been a contributor to many charities, educational institutions, and arts organizations in the cities in which it operates. In its Trim-A-Tree event each December, it has collected over 1.7 million pounds of food for distribution to local food banks.
Before the current recession, the company sales were in excess of $200 million in 39 stores and there were 1200 associates working for the company. After the recession began in 2008, the company experienced a 20% drop in sales, and was forced to make dramatic cuts in expenses, including the termination of 300 of its associates. These efforts were successful and the company returned to profitability during 2009, and has been profitable in 2010. At this time, Lacks has 36 retail stores, a Distribution Center, and delivery facilities throughout the State of Texas.
Lacks will conduct Store Closing Sales at all of its retail locations during the next 45-75 days. Currently, Lacks has locations in the following Texas cities: Beeville, Corpus Christi (2), Sinton, Portland, Alice, Victoria (2), Bay City, Clute, El Campo, Port Lavaca, San Antonio (5), Austin (3), New Braunfels, College Station, Midland, Odessa, Temple, Killeen, Waco, Lubbock (2), San Angelo, Abilene, Tyler, Lufkin, Del Rio, Uvalde and Longview.
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