Appco Pres.: Store Closed Because of Poor Sales

Poor sales – not ongoing bankruptcy woes – forced Appalachian Oil to close its Glade Spring convenience store, company CEO Marty Anderson said Thursday.

But it’s not a sign of things to come for the company, especially now that there is a new plan to stock remaining store shelves and fill gas pumps as soon as next week, he said.

Appalachian Oil, a Blountville, Tenn., company also known as Appco, shuttered gas station-convenience store No. 53 Wednesday, just days after a temporary freeze on employee paychecks and a week after laying off 25 workers, mainly truck drivers, administrative personnel and maintenance workers.

The closing also comes a month after Appco filed for Chapter 11 bankruptcy in a last-ditch effort to stave off creditors demanding more than $10 million worth of debts. Usually, a Chapter 11 filing forces companies to trim payroll and cut costs elsewhere to come up with the cash to pay such debts. However, store No. 53 was cut loose because it was a money pit with a recently lapsed property lease, Anderson said in a telephone interview.

So far, the Glade Spring store is the only one closing among Appco’s 55 stores in Virginia, Tennessee and Kentucky.

“Our stores are, virtually all of them, profitable, or can be,” Anderson said. “I could anticipate that there could be another one or two [closings] but it wouldn’t be related to the bankruptcy. It would just be an opportunity to get out of our unprofitable stores.”

According to its bankruptcy filing, Appco owes more than $10 million to Frito-Lay, the Pepsi-Cola Co. and more than 200 other creditors. To find the cash to pay those debts, Appco must submit to the bankruptcy court a reorganization plan chock full of cost-cutting measures.

Appco began faltering financially in November, when food and drinks began to disappear from shelves because there was no money to restock. In January, the Appco gas stations stopped selling fuel and cut back hours.

Since the slump began, Anderson and parent company Titan Global Holdings, based in Richardson, Texas, have fruitlessly negotiated for much needed credit.

The reorganization plan, Anderson said, might be submitted as soon as today to the Greeneville, Tenn., federal bankruptcy court.

“If we get these stores up and running, which we hope to do in the next several days, then we’ll actually have to be hiring some people for the store level positions,” he said.

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