The Seattle Times reports that "in yet another sign of the pandemic’s lingering grip, PCC Community Markets posted its first loss since the ’90s, with much of the red ink flowing from the co-op’s struggling new store in still-flagging downtown Seattle."
PCC said that it lost $250,000 in 2022 and "was canceling members’ dividend for the year, as soaring costs offset rising sales and growing membership at its 16 locations."
The continuing impact of the pandemic was evident in the company's higher costs - such as government-mandated hazard pay at some of its stores.
And, CEO Krishnan Srinivasan "conceded that roughly a third of PCC’s 2022 loss reflected the poor performance of the downtown location in Rainier Tower at Fourth Avenue and Union Street.
"Despite high hopes by PCC, city leaders and downtown residents that the store could help kick-start downtown’s lagging recovery, the location has generated only around two-thirds of projected sales since it opened in January 2022, Srinivasan said.
"Even though PCC delayed the opening by a year to bypass the worst of the pandemic, the store suffered heavily as many the office workers that were key to its business model stayed home with remote or hybrid work.
"Although the downtown PCC does a brisk lunchtime deli business Tuesday to Thursday, it sees less of the more lucrative after-work business with 'the same office worker picking up maybe a steak, a bottle of wine and some asparagus for dinner on the way home,' Srinivasan said."
However, "Srinivasan insists PCC has no plans to leave. 'We’re not going to cut and run at the first sign of trouble,' he says. To the contrary, the co-op expects better performance overall in coming years, in part because exceptional costs such as hazard pay are gone."
- KC's View:
I respect Srinivasan's position that he does not want to cut and run at the first sign of trouble, but downtown Seattle has been experiencing troubles for some time now. I deeply hope that he's right, and that the situation there will turn around - Seattle has always been one of my favorite places on Earth. But this is going to be a long-term project that I suspect may test PCC's patience.