Cost Cutter says business is improving
Craig Cole, CEO of Brown and Cole, which owns the Blaine Cost Cutter grocery, sounded optimistic as his family-owned company emerges from Chapter 11 bankruptcy proceedings nearly 18 months after declaring themselves broke last fall.
Cole’s optimism was based on having found an investor willing to spend $43 million for controlling interest in the company but who is willing to allow present management to remain in place, keep them headquartered in Bellingham and begin renovating and improving their stores.
“We still have some hoops to jump through, but we’re quite happy with Hancock Park Associates of Los Angeles,” Cole said. Hancock Park normally takes over management of companies they acquire, but that won’t happen. “They’re very clear that they have confidence in the present management,” Cole said, adding that business has improved over the last year and a half.
“We have had good growth in sales and a positive cash flow since filing Chapter 11, and the company’s suppliers and unions have worked cooperatively to support our success,” Cole said last month in a letter to his 1,200 employees.
The 45,000-square foot Blaine Cost Cutter at the Blaine International Mall is one of 20 groceries Brown and Cole own in Washington state.
The company started in Lynden in 1909 when Craig Cole’s grandfather George Cole and Linden Brown rented the Wampler Building at 401 Front Street in Lynden and started a department store.
In later years it was one of three grocery chains that began in Whatcom County, and so competitive that national stores such as Safeway found it difficult to establish stores in the area. The other two chains are Haggen’s, still in business, and Ennen’s, whose assets Cole acquired several years ago.
“Hancock Park’s involvement will provide capital for store improvements,” Cole said, without specifying what they might be, adding that he’s proud of having gone through Chapter 11 without asking employees to reduce their wages or benefits. “Lots of times businesses will finance their recovery on the backs of their workers, but thanks to a good working relationship with the United Food and Commercial Workers Union we avoided that,” Cole said.
Brown and Cole did close eight stores; however, some of them in eastern Washington, as Cole said, got “Walmarted.”
“Big box stores like that do have an impact, especially in that you turn over the management of a significant business in a community to outside interests. That’s why we’re happy with Hancock Park. We see them as having strong and wholesome values, believing in taking care of customers and employees, which is unusual in this day of hedge funds and other bottom feeders.”