Tidyman’s to close three more stores

The Tidyman’s supermarket chain is closing three more grocery stores in an effort to pay down debt exacerbated by a lawsuit.

The Friday announcement said the store at 116 S. McKinnon St., near the Lowe’s home improvement center, and the store at 6405 N. Addison St. will close on Monday at 6 p.m.

Additionally, Tidyman’s is closing the County Market in Livingston, Mont., on Thursday.Employees at the two Spokane stores have been offered positions at other Tidyman’s locations, said Mike Davis, CEO of the employee-owned chain. Employees of the Montana store will receive severance pay based on years of service. Tidyman’s leased that store’s location, and the lease is expiring.

Davis said the decision to close the north Spokane store, which also was leased, was based in part on the expansion into grocery merchandise by the north-side Wal-Mart store.

Tidyman’s LLC received a purchase offer on the Spokane Valley property, although Davis declined to name the buyer.

“It was our first store in Spokane — way back in 1968,” he said.

Store closures over the past three years have enabled the grocery chain to pay down 75 percent of its debt, he said. A chunk of the liability came from a sexual discrimination lawsuit filed by two former employees who said they were paid less than their male counterparts and denied promotions because they were female.

A federal jury ruled against Tidyman’s in 1999, imposing a $6.2 million judgment against the chain. At the time, the grocer lacked the proper insurance to buffer the financial impact. “That added a layer of debt that made it more difficult for the company,” Davis said. Until the lawsuit, the company was in a growth mode. In 1998, Tidyman’s merged with Supervalu Inc. and added County Market stores in Montana and Dissmores IGA in Pullman. At one time Tidyman’s LLC operated 21 stores in Washington, Montana and Idaho; after the closures announced Friday, the chain will have eight locations.

Davis said in addition to debt and Wal-Mart, an increasing number of non-grocers, like drugstores, are selling food items. Stores operate on about a 1 percent profit margin, he said, which creates a fine line for companies. “There’s just not a lot of margin for error,” he said.

Davis, who spent Friday meeting with employees at the stores that will remain open, said the company will keep paying down debt and making decisions to improve the chain’s financial health.

“We’ll just continue doing that and focus on our profitable stores.”