After 71 years in the building materials industry, Payless Cashways, with headquarters in Lee’s Summit, Missouri, has cashed in its chips. In and out of bankruptcy, Payless is now liquidating the business. At one point Payless Cashways had 200 stores and $2.6 billion in sales. But on August 28th, the company shut down its 72 remaining stores and laid off 5,000 employees. Payless now joins such former building supply failures as Grossman’s, Hechingers, Pergament, Builder’s Square, Rickles, Home Base, and others which have either gone into another business, or gone under. Very soon, your choice of hammers will come in orange (Home Depot) or blue (Lowe’s). According to the National Home Center News, it took Payless 7 years to die. In 2000, the company had sales of $1.49 billion — but that represented a -18% drop from 1999, and only 57% of its high water mark of $2.6 billion in 1993. The company went into Chapter 11 reorganization in 1997, and again in June of 2001. The industry newspaper attributed the Payless slide to “when the big box dominance of Home Depot and Lowe’s overwhelmed it.”
Another 5,000 employees lose their jobs as market share is consolidated at the very top companies. The next 20 Home Depots that open up will only make up for the deficit of jobs lost when Payless left its employees payless. Government officials seem to be clueless to the loss of Payless, as more and more firms shut down.U.S anti-trust laws essentially being meaningless, the closure of these large, regional chains leaves consumers with fewer and fewer choices. Only in America could a company with nearly $1.5 billion in sales go bankrupt. Small hardware stores try to plug along with a few million in sales, or even less, while the billionaire companies go belly up. Good things happen when Home Depot comes to town. But bad things happen to everyone else.
