Thoughts on Shopko

Monday was a rather sad day here in Fort Atkinson, as we received word that Shopko will be closing all of their remaining stores, within the next few months. The retailer had been trying to find a buyer to take on their remaining stores, but has failed to do so.

This leaves a major retail hole in our city. After having lost K-Mart in 2014, Shopko was the remaining major retailer. Like many places in Wisconsin, Shopko became our sole location to purchase basic goods like shoes, new clothing, household staples, and other items locally.

shopko FA outside

Shopko on Janesville Avenue in Fort Atkinson, closing in early June.

Fort Atkinson has a strong culture of wanting to keep shopping local. This is evidenced by still having a decent amount of locally owned shops in our downtown, and the continually thriving Farmer’s Market that our city hosts on a weekly basis every year. We also have a very active Chamber of Commerce that promotes the “shop local” ethic.

As many residents know, Walmart approached Fort Atkinson years ago, desiring to open a new store here. A group of local residents initiated a campaign to resist Walmart, and the retailer eventually opened a store in Jefferson instead. Walmart also currently operates a location in nearby Whitewater.

While it might be tempting to say, “We should have let Walmart come in!”, I would point out that not every Walmart store is successful. At the time, our city still had K-Mart and Shopko, and there’s no guarantee Walmart would have remained open indefinitely in our community. Alternatively, maybe Walmart would have thrived, but there’s a good chance other smaller shops in our downtown would have closed.

Shopko’s demise is not the fault of shoppers in Fort Atkinson, or any other community. This recent article from the Milwaukee Journal-Sentinel explains a major problem with the company:

Shopko’s creditors want to force the company’s owners to return $117 million in dividends paid over the last four years.

In a motion filed in bankruptcy court on Tuesday, a committee representing some of the company’s largest landlords and suppliers said $67 million in special dividends and fees constituted a “fraudulent conveyance” while another $50 million in dividends were “illegal.”

The creditors committee is seeking a Nebraska bankruptcy judge’s permission to attempt to recover those claims, which could add millions of dollars to Shopko’s balance sheets at a time when unsecured creditors, those who do not have a claim to collateral, face a real chance of not receiving anything of what the Ashwaubenon-based retailer owes them for inventory, services and leases.

In February, Shopko’s two independent directors identified $179.5 million in dividends paid to Shopko’s private equity owners — Sun Capital, Waverly Securities, KLA Shopko LLC and H.I.G. Sun Partners Inc. — between 2007 and 2015. The company borrowed money to pay the dividends, according to court documents.

So we have an example of a company that paid investors huge sums of money, through borrowing, while Shopko continued to struggle. Fort Atkinson now, like other communities, is faced with the prospect of a vacant retail site, and a loss of jobs.

So, what should we do about it? I will share that, like many citizens, I still desire to have a major retailer in Fort Atkinson. We deserve to have a store in our community where we can go for basic necessities. Personally, I purchased my contacts and other optical needs there, and would shop there regularly. My wife and I would also do a decent amount of our Christmas shopping there. I will miss having them in Fort Atkinson.

I can tell you that our city manager and I have already started contacting other retailers, to inquire about their prospects for future stores in our city. I do not want to get any hopes up, though, that we will be able to find a new retailer in the near future. Nationally, most major retailers are not expanding, and many of the existing ones limit their locations to larger metro areas (ie. cities the size of Madison, Milwaukee, Janesville, etc).

I will also share that Costco and Meijer have already turned us down, as far as any plans for a Fort Atkinson location. This is mainly due to their population requirements for a given market.

My personal view is that the majority of future retail store growth in our community won’t be initiated by outside interests. I would suggest that it will be initiated by residents living and working in our own city. Maybe we won’t have a major “big box” store again, but maybe we could have several smaller retail stores, possibly owned by local entrepreneurs.

Fort Atkinson is a city that often doesn’t receive a lot of assistance from the outside. It often feels like we don’t have anyone advocating for us in Madison, and the federal government certainly isn’t stepping in to help us. Most of our biggest successes have been accomplished by ourselves, by people right here in our community.

Our future is in our hands. We need to start having conversations now, about what we want our city to look like in the future. Our recently approved Comprehensive Plan update (just passed this Tuesday), calls for retaining and growing retail and locally owned businesses. Let’s work together to make sure that happens.

If you have thoughts, please share them here, or email me at mbecker@fortatkinsonwi.net.

12 thoughts on “Thoughts on Shopko

  1. Lynda Strom March 21, 2019 / 10:42 am

    Anyway we can use the Creamry pjg building and create indiir shopping mall on varioys floors, there is elevatie service in the building for access, may need more. Janesville and Waukesha did something similar to bring business to downtown. There is parking nearby, no further walk than walking to mall stores. May have to adjust for handicap parking closer to bldg. Independent businesses could be on each floor or two or three per floor. You could provide several shopping options. Clothing men, women, children, shoes, etc. Each floor could feature complimentary options, home furnishings, sports, a food court, optical/dental services could also be accommodated. Shopping all under one roof. This could possible bring traffic downtown where more independent businesses could pop up and existing ones could flourish also.
    I would be happy to help serve on a committee.
    Lynda Strom, 608-449-9704
    strom.lynda@yahoo.com
    Serveral years ago I was chairman of retail committee for the Chamber and we had several discussions of retail business downtown and how to increase, history reapeating or continuing. Back then there were issues of the bypass affecting the downtown. As far as Shopko blging, a grocery store or something of that nature would be a great option for the South end of town. There has been new residential building since Shopko was built, Copps had grocery which helped the South end of town, that’s where I grew up. These are just some suggestions, Fort us my hometown and always will be I would like to see it be prosperous and grow. Call if you want to chat, if I miss your call leave message, I don’t live with my phone on me like some. Thanks for opportunity to suggest. I recently had this posting conversation on FB with Fort residents.

    • Stacy March 21, 2019 / 2:05 pm

      Creamery building has occupants on all five floors but years ago that would have been a possibility.

    • Ali March 21, 2019 / 9:06 pm

      Shopko employees were underpaid and overworked and DEFINITELY underappreciated. Their struggle probably started when they out-sourced to India. Maybe they should have focused more on their employees than being an official sponsor of the Green Bay Packers. I got barely a head nod when leaving after investing 13 years of my life there.

  2. Adam March 21, 2019 / 11:19 am

    Hi Mason, I want to make sure it is clear somewhere that it was not the group that opposed Walmart that made it move to Jefferson. The city did not want to cross the bypass with water and sewer – something very much needed by a big box store. That was the final goodbye to Walmart, not the opposition by the small group.

  3. Mike March 21, 2019 / 12:33 pm

    The thing that makes city’s unique are businesses that are unique. Allowing another big chain company has its risks as we’ve just seen with Shopko. If we want to attract people and support local population we need something that’s appealing and necessary to guarantee its longevity. A “combo” store would be a possibility as Shopko was… but something that drew interest from a majority of Fort’s residents. The strip malls offer little and they virtually mimic every other city.
    Be different…

  4. Nordeana Orvold Nomphius March 21, 2019 / 2:15 pm

    Have you tried Target?

    • Mason T. Becker March 21, 2019 / 2:28 pm

      We’ve reached out to Target, but I don’t believe we’ve gotten a response yet.

      • Patti March 22, 2019 / 8:34 am

        I don’t think we would be happy with a Target in a building as small as Shopko. Definitely need something on this side of town tho. I think a health food store or a sky zone would be awesome.

  5. Stacy March 22, 2019 / 10:12 am

    A Tractor Supply would be good. Something to cater to our farming community.

  6. swarner0702 March 22, 2019 / 10:13 am

    A Tractor Supply would be nice. Something to cater to our farming community.

  7. John Doe March 22, 2019 / 11:29 am

    Everyone is so quick to judge Walmart. I am sure they have their pros/cons like every other single business, but look at examples all around with Walmart. Walmart moved to the north side of Janesville along with Sams Club. Look at the growth of restaurants, retail, and grocery it developed when they moved. Walmart moved to Jefferson, eventually they got a Tractor Supply. Years ago, Walmart moved to the south side of Watertown, look at the growth on the south side of Watertown since they opened. This is just three examples locally. I see this driving all over Wisconsin. Walmart builds and less than five years later the whole area is developed. Knock Walmart , but apparently they are doing something right. So far I have not seen them closing any stores and if they are closing a store they are building a new larger footprint.

    It would be nice to have a grocery store on the south side. An aldi’s would be nice or even a kiwik trip on the south side.

    This great city has great potential to draw in business only if the city wants it to grow.

  8. Linda March 25, 2019 / 2:20 pm

    We need a children’s place for our long winters!! Inside play area, trampolines, trikes and small people toys, bouncy houses. Our community has so many children and no where in town for them on our long cold winters! Now even McDonalds won’t have a play area! This town is losing everything!

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