Crystal-Pierz Marine closes five of 12 stores

MINNEAPOLIS – Crystal-Pierz Marine has shuttered five of its 12 stores and laid off two-thirds of its employees in an effort to reorganize the company.
The company, which peaked with revenues of nearly $90 million several years ago, has been adversely affected by what President and COO Luke Kujawa suggested in an interview this morning, has been the perfect storm of poor economic conditions.
“We had a horrible spring, weather-wise; the worst of the gas prices came at the peak of our selling season; the cost of boats has gone up as the cost of raw materials have increased; we’re so dependent on the housing market, and we’re in [the downside of] a housing bubble right here,” he explained. “More than that, though, we’re in a market and an economy that has been historically insulated from bumps on the economic side of things. We have a very diverse economy, so we’ve weathered the storms in the past. And so we’re not used to it when things like this happen.”
Crystal-Pierz will close its Rogers, St. Cloud and Duluth stores, in addition to shutting down its seasonal sales operations in Forest Lake and on Lake Mille Lacs. That will leave its stores in Shakopee, Brainerd, Gull Lake, Walker, Fargo, Rice Lake and Clear Lake, Iowa.
The move required laying off 100 of the company’s 150 employees. And the company has also begun efforts to liquidate more than 700 boats from its inventory.
“This industry is about inventory and overhead,” Kujawa said. “If you can control those two, you’re going to be in good shape. Our inventory is at its lowest point in 10 years. We’re feeling pretty good about that. But with 12 stores, you’re in good shape. When you close 5, then you’ve got a problem.”
Kujawa said that, when the company reviewed its numbers, the decision to close those stores was easy. Those stores, he said, had the highest overhead and were also losing the most money.
“We’ve pruned the dead branches out of the tree,” he summarized, “and now the rest of them can go produce fruit.”

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