Rumors began swirling last week about the closing of ALCO Discount Store, located in the Johnstowne Mall. Those rumors have now been confirmed.

A press release sent to The Daily Union stated, “Duckwall-ALCO Stores, Inc. has announced it will close its ALCO store in Shelbyville, IL, in late April.”

In making the announcement, Bruce Dale, President and CEO said, “The decision to close the store in Shelbyville was a difficult one. We have valued the opportunity to be a part of this community but unfortunately the store’s performance does not meet our financial requirements.”

ALCO manager Michael Hinks said that neither he nor the employees have been cleared to discuss the matter with news media until permission is granted from the home office.

Tom Fulton, whose wife Kristie is an employee of ALCO commented, “It's a shame about the store closing but I have to say they have been very classy about it all. They have been above-board with the employees from the beginning, letting them know what was going on with the company. I think they have handled it as well as it could have been handled.”

Duckwall-ALCO Stores, Inc. was founded in 1901 in Abilene, Kansas and has been in continuous operation since that time. The company currently operates more than 250 stores across 22 states.

Duckwall-ALCO filed for Chapter 11 protection in 1989 and closed 52 of its 151 units as part of its restructuring plan. Competitions, mostly from Wal-Mart, resulted in a $10 million loss.

In 1991 the company restructured their business strategy to avoid direct competition with the larger stores, concentrating on smaller communities. Following on that strategy, ALCO opened store #246 in Shelbyville in 1994.

According to the ALCO website, "Our company prides itself on our unique store concept, the only one of its kind serving many of the smaller communities of America. We specialize in offering a wide variety of products at reasonable prices to the underserved communities of America."

However, Wal-Mart was also looking at moving into the smaller markets and changed strategy early in 2000, introducing scaled-down supercenters like the "109" and the "98" consisting of 109,000 and 98,000 sq. ft. respectively. The store in Shelbyville is a "98." The modified stores sizes are designed to serve smaller communities that are at an inconvenient distance from the nearest supercenter.

On January 22 of 2007, Wal-Mart opened for business in Shelbyville. Just over a year later, ALCO employees were told the bad news.

Other businesses in direct competition with the supercenter seem to be holding their own. County Market grocery, also located in the Johnstowne Mall also took an expected dip in sales when the supercenter opened but has weathered the competition so far.

Store Director Mike Lawson commented, "We are definitely doing better than expected. We are consistently beating budget."

Since 2005, Duckwall-ALCO has tried to work around a proliferation of megaretailers including Kmart and Target, opening 23 stores and closing 33.

Nevertheless, the overall plan seems to be working. On February 7, 2008 Duckwall-ALCO reported a sales-to-year date increase of 6.8 percent, ($8.5 million) resulting in sales of 37.1 million as opposed to 28.6 million for the previous period. Duckwall-ALCO also plans to open 25 new stores in 2008. Duckwall-ALCO stores are more prevalent in Kansas and Texas (79). Illinois currently has seven stores.

A plus for shoppers, the Shelbyville ALCO will have markdown prices on many items prior to its closing date which is reportedly on April 27th or 28th.

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