CLEARLAKE, Calif. – After two decades in business, Ray's Food Place in Clearlake is due to be closed and the property sold by the end of this year.
The store's parent company, C&K Market of Medford, Ore., announced the decision to close the store.
C&K Market owns and operates 42 stores under the banners of Ray’s Food Place, Shop Smart and C&K Market across Oregon and Northern California. C&K Market also owns Bruno's Shop Smart in Lakeport.
The company said that, as the result of an evaluation of its stores this year, it decided to close the Clearlake store as well as one in Brookings, Ore.
While both stores are located on properties owned by C&K Market, the company said neither was performing profitably enough to support their rent.
In a “strategic move” that's meant to strengthen the company, C&K Market said it concluded that it was more financially prudent to close the stores and sell them than continue to operate them.
“It’s normal for a healthy, profitable grocery chain to close some stores and open others. We
actively evaluate each store’s performance on a regular basis. Our goal is to increase profitability of
every store, so we create a stronger organization,” said C&K Market’s President Karl Wissmann.
As a result, both the Clearlake and Brookings stores will be shuttered and sold by the end of 2016, C&K Market reported.
Dan Gustafson, C&K's advertising director, told Lake County News that, altogether, 36 employees will be impacted by the Clearlake store closure.
Employees will be offered the opportunity to transfer to other stores. For those who do not want to relocate, C&K said its human resources department will work with state workforce agencies to help them find new jobs.
At the same time, the company reported that it has agreed to sell its former headquarters building in
Brookings to a health care organization.
The company said it is continuing to to assess its locations, real estate holdings and potential new locations in order to assemble stores that fit its emphasis on integrating natural and organic items with traditional groceries. No additional closures are planned.
Negotiations are now under way between C&K Market and buyers for both locations, with those sales anticipated to be completed soon. Gustafson said he could not give more details on when the Clearlake store sale might close.
C&K Market built and opened the Clearlake store in 1995. Gustafson said the potential buyer – who he could not name at this time due to ongoing negotiations – intends to put the building to another use.
Gustafson said the Clearlake and Brookings closures were not related to the Chapter 11 bankruptcy from which the company emerged in 2014.
As for the market forces that led to the closure of Ray's, Dennis Darling, who along with wife Ruth has owned Foods Etc.-IGA on Lakeshore Drive for the last 18 years, pointed to some specific factors.
For one, “There's already too many grocery stores in Clearlake,” he said, noting it's a fact he's pointed to for a long time.
In addition to Foods, Etc. and Ray's Food Place, large grocery stores in the city of about 15,000 residents include Safeway, Grocery Outlet and Walmart.
And Darling suggested that the biggest factor may be Walmart, Ray's Food Place's immediate neighbor, right across the parking lot.
Darling calls the retail giant “the $450 billion gorilla,” adding, “They want everything.”
Walmart said last year that it planned to move forward with a major store remodel and expansion that would add nearly 40,000 square feet onto its store on Dam Road, which now is more than 100,000 square feet in size.
Much of that increased store footprint would be for Walmart's planned grocery department expansion.
Well ahead of that planned expansion, Darling said Walmart has continued to add products sold at Ray's, which has resulted in drops in business for the grocery store. “That's been going on for years,” he said. “They just finally gave up.”
Amazon also is emerging as another competitor for local stores. “They're a continuing threat to anyone who's got a box,” Darling said of storefronts.
However, he doesn't think Amazon is an issue in Clearlake's market, which is not as given to online purchasing as urban areas because of factors including demographics, income and transportation.
However, Walmart now is getting into “click and pick,” where people can shop online and pick up their purchases locally. “That's coming. It'll be in the cities way before it gets out here to the rural area,” said Darling, adding he thinks it will come to Clearlake eventually.
What happened to Ray's in Clearlake, said Darling, is an example of what happens when Walmart enters a small community. “They've done this in city after city.”
Darling said it's heartbreaking to see so many Ray's employees lose their jobs.
“It's a lot of people to be out of work just before Christmas because of the big box across the parking lot,” he said.
Email Elizabeth Larson at This email address is being protected from spambots. You need JavaScript enabled to view it. . Follow her on Twitter, @ERLarson, or Lake County News, @LakeCoNews.
