Appeared in the Mar. 20, 2013 issue of the Interlake Enterprise, By Teresa Carey…
Employees of Palssons Family Food are reeling after learning on Mar. 11 that, after 33 years of doing business in Arborg, the store would be closing for good on Mar. 22.
Cashier, Ann Sutyla, said that everyone was taken by surprise when owner Ian Palsson broke the news.
“I was just shocked because I had no knowledge that it was selling,” said Sutyla. “He said the business just wasn’t here in Arborg the way it was before.”
Sutyla, who has been a cashier at Palssons for 15 years, has herself noticed a decline in business over the years.
“A lot of people are going to Winnipeg to the bigger stores. A lot of people are going to Gimli,” she said.
Sutyla said she plans to find another job in Arborg. She said some of the remaining 15 to 20 employees have already had job offers, but does not know whether or not they will accept these.
Rumours have been flying as to what Interlake Co-op plans to do with the space. One rumour is that the space would be turned into a mega Co-op store that would also house the farm and building centre. Another is that the space would be used as storage.
“That depends on what you mean by storage,” said Interlake Co-op General Manager, Dennis Laing. “If there’s nothing going in, we may store some shelving.”
Laing dismissed the rumour of a mega-co-op.
“There is zero truth to that,” he said. “We have a home centre on the highway, and that’s where it’s going to stay…We currently have no plans for the space. Having said that, we are open to anyone looking at leasing this space.”
Another rumour that has been circulating is that Interlake Co-op will not be hiring any of the people currently employed at Palssons.
“A number of their employees have been approached. As of today, I have met with seven. Only one has successfully been hired, but I am still looking at all seven,” Laing confirmed.
There is concern among some Arborg area residents that food prices will most certainly rise because of this deal.
“A lot of people are worried,” Sutyla said, “because there will be no competition. Some are saying they’ll go elsewhere because of it.”
Again, Laing made assurances that a rise in food prices will not be the end result.
“There’s going to be the perception that because there will only be one food store in Arborg, prices will increase. We will be making a concentrated effort, not only to hold our prices, but in some cases to lower them.”
In discussing whether Palssons will be having any big close out sales, Sutyla said she does not believe so. Laing has confirmed that all of Palssons inventory has been bought out as part of the deal.
When Palssons closes on the 22nd, employees will move the merchandise into the Co-op space. Interlake Co-op will also be picking up some new lines currently carried only by the Palsson store, for example, hemp hearts.
Laing did not disclose what Co-op paid for Palssons, citing a confidentiality agreement. However, he did say that Interlake Co-op did not incur any additional debt as a result of the transaction.
“We had saved enough cash that we were able to do this deal without taking out a loan. Therefore, it won’t affect equity allocations or cash repayments, ” Laing said.
“The economics of this project make it feasible because it requires no further renovations to our food store.”
Laing said that the existing Co-op store is large enough to accommodate the additional merchandise.
Laing was first approached by Palsson last summer. Discussions between the two parties became more serious during October and November.
As part of the agreement, news of the buy-out was to be kept confidential.
