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Quirky Joppatowne discounter C-Mart is going out of business, another victim of economy

The Baltimore Sun

C-Mart, the local retail institution known for piling its shelves with designer brands on the cheap, is going out of business next week, the victim of a sour economy where even the best deals couldn't bring out enough penny-pinching consumers.

Shoppers once clamored outside the doors of the Harford County retailer for the chance to get a Prada handbag, Gucci sunglasses or Manolo Blahnik pumps. They traveled from New York, New Jersey and Pennsylvania to rummage through the store's legendary cluttered shelves and jam-packed aisles hoping to find that couture dress.

But during the past year, facing higher gasoline and food prices along with tighter credit, shoppers stopped coming, the retailer's owners said yesterday. As home sales declined, so did the need for shoppers to buy furniture, which made up more than 50 percent of C-Mart's revenue.

Soon, sales at the 33-year-old retailer declined and it was forced to lay off some employees. New owners, who recently came on board with visions of aggressively expanding the retail operation, put on hold a plan to start an e-commerce division of the store. And with no sign of a reprieve in the economy anytime soon, the owners decided shutting down was the only answer.

They plan to close for good Oct. 14.

"Unless you're selling things that people have to have, bread and butter and things like that, it's hard out there right now," said Daniel Shuman, C-Mart's chief executive officer. "If you're selling Calvin Klein jeans and Ralph Lauren sweaters, those are things people are willing to do without when they have less discretionary income."

The closing of C-Mart brings to an end what had become a local institution with a cult-like following of shoppers, including many adults who had shopped at the store as children.

E. Douglas Carton opened C-Mart at an old five-and-dime store in the 1970s, when discount shopping was still a new idea. Carton never had an interest in expanding the business, but when a new generation of his family took over, they had different ideas.

Under the direction of Carton's nephew, Keith Silberg, C-Mart closed its small store in Forest Hill in 2005 and opened in an old K-Mart in Joppatowne. The store began selling furniture. It opened another location in Prince George's County in 2007. That store was closed about a year later.

Fifteen months ago, Silberg sold a majority interest in the family business to childhood friends Shuman and partner Brad Bondroff. Jon Ferber, co-owner of Advertising.com, the Internet advertising company that he eventually sold to AOL, became chairman of the board.

The new owners, who also own an online liquidator, the Asset Store in Baltimore, had plans to modernize the no-frills retailer, where workers still used pencils and paper to record inventory and price merchandise. The economy turned before Shuman and Bondroff could put their plans in place. Silberg and Carton could not be reached for comment yesterday.

"Unfortunately, we never got a chance to get everything launched," Shuman said. "We had gotten everything geared up to launch an Internet site and we would have had to commit capital to do that. But not knowing how long the downturn would last, we needed to keep the capital going to the retail store operation."

C-Mart workers began liquidation sales a couple of weeks ago, discounting goods as much as 90 percent.

Yesterday, the store looked like C-Mart during its better days as customers crowded in for the discounts. Shoppers pushed overflowing carts. Lines stretched through the store.

But most customers didn't know these would be C-Mart's final shopping days.

Esther Reid of Joppatowne figured the deep discounts were because the store was getting ready to restock merchandise.

The 52-year-old owner of a cake-making business has shopped at C-Mart since she was 18. She said she could dress her kids in trendy name brands without spending a lot. She was surprised and saddened at news of the closing.

"This is the best place to shop, especially if you have kids," she said, resting in a chair next to a shopping cart full of clothes. "You can get a good outfit for not a lot of money."

Diane Silvestri has shopped at C-Mart since it opened. She remembers once nabbing a pair of designer shoes originally priced at $300 for $40. Another time, she bought a rocking chair for $10. It was sometimes a chore digging through the crowded racks of clothes and shoes. But it was a task she came to enjoy.

"I'll miss them," said Silvestri, a 67-year-old retired nurse from Joppatowne. "You had to hunt and peck, but it was worth it."

Some local retail experts said they were surprised at C-Mart's closing. While the economic climate has forced many retailers to shut some stores and has put others out of business, discounters have had an advantage because shoppers are looking for bargains.

"I thought that some businesses were somewhat recession-proof," said Thomas Maddux, president of Towson brokerage KLNB Retail. "I sort of perceived this economy to favor high-value retailers."

But Mark Millman, a retail consultant and CEO of Millman Search Group in Owings Mills, said he was not surprised by the announcement.

Millman, who worked with C-Mart to help it find employees, said he believes the new owners didn't have the retail experience to keep the business running. He said that as a discounter, C-Mart should have done well in a sluggish economy as shoppers looked to "trade down" or buy at bargain prices.

"In these economic times, all my clients that are in the discount retail area or the moderate-priced area are doing well," Millman said. "There is no reason this successful operation with heavy market penetration could not have survived."

Shuman disputed that shoppers would come for bargains despite the financial environment.

"As long as we've been in business and despite the great bargains we had, we're not economy-proof," he said.

Shuman said C-Mart has about 30 employees that it would try to help find jobs.

Rechelle "Rocky" Matus, 57, has worked at C-Mart for 19 years. Her son is now the general manager and her daughter also works at the store.

She first started to suspect something was wrong when the company began laying off people during the past year. Her suspicions grew when it began discounting merchandise more heavily than usual.

"This is the only real job I've had," she said. "This is going to be difficult."

Paula Spiker, 54, has worked at C-Mart for 24 years. She has come to know customers by name. She was laid off by C-Mart for three months but recently got her job back.

She's sad that she'll lose it again.

"My mother used to tell me I'd die at C-Mart," she said. "It's like family here."

Harford County retailer C-Mart will close Oct. 18. An article in Monday's newspaper gave an incorrect date.The Baltimore Sun regrets the error.
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