When Retail Goes Sour: The Tale Of A Store Liquidator

Jim Arcaini is standing along side a ladder in a bookstore; a cellphone pressed against his ear while quickly jotting down notes on the only piece of paper he had handy – a folded $10 bill. With a friendly smile and a boisterous voice, he occasionally takes a break from putting up signs to jovially chat with employees. He has the appearance of a humble grandfather, but appearances can be deceiving – Arcaini is a corporate grim reaper.

When a company falters for too long, Arcaini and others of his ilk come in to help pull the plug. Arcaini is a store liquidator -- a consultant hired from a liquidation holdings company to assist in the removal of all merchandise.

“I have nothing to do with these companies going under. We are asset managers, nothing more. We simply help people strike balance and help manage during the process of closure.” said Arcaini.

Arcaini is a consultant from Hilco Trading, the largest asset liquidation firm in North America and Europe. Insideview.com estimates Hilco's annual earnings at $150 million. It makes that $150 million by buying up assets from dying companies for cheap and selling it for a profit.

Arcaini, the 67-year-old Camdenite and father of two, is personally overseeing the liquidation of three stores, one of which is local the Borders Superstore in Langhorne which began liquidation about a month ago. Arcaini got into the business after helping the liquidation of a store he managed, a Two Guys discount store in New Jersey.

The liquidator "liked my style and how well I managed my own liquidation, and they brought me in to the business,” recollected Arcaini. 22 years later, he still is in the business. “I've always loved my job.”

The job of a liquidation consultant isn't always one that receives a lot of love.

“Many times people look at us and you can hear a 'hiss.' To them, we are the villain, but we aren't. We are providing a service, nothing more.” said Arcaini.

“I feel like it's shady,” said Taylor McMenamin.

McMenamin is an employee at the liquidating Langhorne Borders store.

“They are only coming in to profit off of us. They don't care where you go, they don't care if you end up homeless. They just want to make their money. I'm surprised they haven't sold us yet.” said McMenamin.

Raking in money may have been easy for Hilco, but in recent years its been a rough road for the individual consultants that they employ. Arcaini works long hours – from 7 a.m. to midnight, sometimes every day. Hilco consultants work on a contracted basis; if there are no stores closing, a contractor simply doesn't get paid. In 2007, when the economy crumpled, many consultants found that Hilco was not recession proof, in fact quite the opposite.

“The last two years especially have been really rough,” said Arcaini. “During a recession, retailers cut their wages, they cut their inventory, they cut their hours. Eventually they actually end up saving money.”

During the extensive downtime between jobs, Arcaini had to find time part-time work to pay bills.

“The downtime is depressing,” said Arcaini.

Despite the claims of business being bad during the recession for liquidators, a cursory glance makes that claim seem inaccurate. In 2010 a number of retail chains closed up shop. 2,415 Hollywood Videos, 545 Blockbusters, 114 Payless Shoe stores, 145 Men's Warehouse Outfitters, 33 Hallmarks, 10 Pathmark Grocery Stores and 173 Jones Apparel stores closed down in 2010. Many of these companies employed asset liquidation firms to close their outlets. Hollywood Video in 2010 and recently Blockbuster Video employed Hilco as its primary  liquidation consultant.

Close to home, many big-box retailers in Bristol and Falls townships closed up in the past three years. Bristol's Hollywood Video, Blockbuster and Pathmark are all closed or closing. Falls township Blockbuster, Borders and Circuit City also saw the economic axe.

Arsaini sees a light at the end of the tunnel for store closures.

“You always take it to heart when you see people lose their jobs, but I truly believe that when a door closes, a new door opens up; and usually, its better on the other side.” said Arsaini.