Nassau, The Bahamas - Abaco Markets Limited announces the closure of its Cost Right Abaco store today (March 9th) due to its non-performance despite significant investment and restructuring.
Cost Right Abaco was closed at 6pm today as senior Management met with its employees. All employees will receive full severance packages with the majority of the 14 person staff receiving their packages immediately and some remaining on staff to assist with the transfer of both product and equipment to the Group’s other locations.
The Company has also offered continued coverage on the Group’s health insurance plan for up to 6 months to enable affected employees to find alternative coverage.
“We very much regret the closure of Cost Right Abaco – after the commitment to relaunch it was made only last year with over $1m invested to revitalize this location,” says Mr. Gavin Watchorn, President, Abaco Markets Limited. “We’ve tried many options – from wholesale to the revamped Club model to the reintroduction of retail product most recently – with no success. Unfortunately, despite this significant investment and the many changes, Cost Right Abaco continues to lose money – both in terms of lagging sales and high inventory losses,” explains Mr. Watchorn.
Abaco Markets reveals that the Board had been contemplating closing the store for some time but, in an effort to avoid such action, the Group sought out potential purchasers for the business and had been in discussions with a particular group for several months. When a potential sale became a possibility, the Company decided to keep the location open in the hope of concluding a sale. However, it recently became clear that a sales agreement would not be reached and the store’s performance has continued to deteriorate. “This location has been subsidized by other Group locations for several years now but given the uncertainty in today’s economic climate, Management determined that, more than ever, this just isn’t the economy or time for taking unnecessary losses or risks,” explains Mr. Watchorn.
“Closing Cost Right Abaco has been a very difficult decision – especially at a time like this,” says Mr. Watchorn. “However, we have worked hard to rebuild our Company and all of our locations, with the exception of Cost Right Abaco, are now stable and consistently profitable. It is important that we stop the significant drain of resources and focus on the solidly performing locations in the best interest of the Company, our shareholders and our employees,” he adds.
“We have been very committed to doing what we can to maintain a solid performing location there,” says Mr. R. Craig Symonette, Chairman & CEO, Abaco Markets Limited. “Abaco Markets started in Abaco – and this decision to close is something we have struggled with for a long time – trying so many different options and investing a lot of money to make it work. However, we are just not getting enough support to sustain the investment and focus there. While we are very disappointed to close Cost Right Abaco, we are doing what is best for the Company as a whole – particularly given the current economic environment which will require the focus and dedication of all our resources to ensure that the great steps we have made toward stability are safeguarded,” explains Mr. Symonette.
“We very much appreciate our employees in Abaco who have worked hard and tried many things to improve our business there. We know this will be a difficult time for these employees and their families which is why we immediately secured full benefit packages to help with this transition,” says Mr. Watchorn. The Company expects to take a one-time charge of approximately $300k related to the closure – the majority of which being reserved for severance packages.
The Company is hopeful that a sale or lease agreement for the building will be put in place in the near future. Abaco Markets Limited requests that any queries, collections or concerns are directed to its corporate headquarters in Nassau (tel 242.325.2122, PO Box SS-6322, Nassau, NP).
