Owner cites customers’ changing shopping habits for dwindling sales

Crest Hallmark Shops announced plans to close its Kennewick Plaza store this month citing declining sales.

The Richland store on George Washington Way in Washington Plaza will remain the sole Hallmark Gold Crown store in the Tri-Cities of the five started by the Jilek family in 1968.

[blockquote quote="We’ve held on longer than most...you can only sustain so many losses." source="Patrick Jilek, owner of Crest Hallmark shops" align="right" max_width="300px"]

Patrick Jilek, a second generation owner, said five to six years ago he didn’t foresee this happening, but in a rapidly changing retail world, external marketplace forces have been shutting down Hallmarks nationwide.

“We’ve held on longer than most,” he said.

However, declining sales over the past couple of decades culminated in a massive drop-off last year, prompting the decision to close.

“You can only sustain so many losses,” he said.

Longtime customers like Joe Gallegos, who’s shopped at the Kennewick Plaza Hallmark for the past 20 years, lamented the closure.

“I hate to see (Hallmark) leave, but I understand,” he said.

Gallegos said he has a lot of friends and family “so, I’m always buying cards.”

Jilek cited the greater availability of greeting cards in grocery and drug stores and changes in buying habits as the major factors leading to the closure.

“I like your cards better,” Gallegos told Jilek.

Online shopping played a role in this shift, though Hallmark Gold Crown stores typically performed well when located in the same shopping center as a grocery store, Jilek said.

Customers running in for groceries often would make a stop to pick up cards, he said.

“Eight out of 10 of my customers are women,” Jilek said. “The average family makes two to three trips to the grocery store per week, and two to three trips to drug stores per month.”

But over the years, grocery and drug stores have diversified, significantly expanding their selection of greeting cards and enhancing their one-stop-shopping experience. Customers on the go began opting for cards available on their way to the checkout, Jilek said.

“It doesn’t sound like a big deal — people buying a few cards at the grocery store instead of coming to us — but when you multiply that all across town, it has a big impact,” he said.

Jilek said Hallmark’s signature greeting cards were the major reason people frequented his stores.

As for the other merchandise the store carries, Jilek said “the majority of Hallmark stores are independently owned and operated, so we’re free to choose non-Hallmark branded gifts.”

However, Jilek said it didn’t really make a difference what products the stores carried because “if traffic counts for the core product line declines, there’s less chance of selling other products.”

So, when greeting card sales started to drop off, so did the sales of everything else.

Hallmark Gold Crown stores debuted in the United States in the mid-1960s as specialty gift and party supply shops, and were popular well into the early 1990s, even as the company began selling its card line in the grocery and drug stores that eventually eroded their customer base, Jilek said.

In the late 1950s, Jilek’s parents, Spence and Carolyn, independently owned several Rexall drug stores throughout the Tri-Cities, which sold Hallmark cards.

In 1968, after the Hallmark store concept was introduced, the Jileks decided to open a store in Columbia Center mall, in the space now occupied by Coach.

“I remember being 8 years old running around on the concrete slab of the original mall,” Jilek said.

After the 10-year lease was up, the mall opted not to renew it, and the Jileks moved the store across the street into what  is now Bed, Bath & Beyond.

The central Kennewick Hallmark store opened in 1976 in the Highlands Center, where the Albertsons used to be. The shop operated there for 20 years. When that lease was up, the Jileks moved the store to its current location at Kennewick Plaza to be close to Safeway.

The Jileks eventually came to own and operate five Crest Hallmark shops throughout the Tri-Cities: two in Kennewick, two in Pasco and one in Richland.

Jilek and his siblings grew up working in his parents’ stores. He said he remembers running the register at age 13. He took over management of the shops in 1990 when his father died.

According to Jilek, there were more than 5,000 stores throughout the United States at Hallmark’s peak in the mid-1980s. But in the last five to 10 years, two out of three of those stores closed their doors.

Today, fewer than 1,700 stores remain.

Jilek said as leases ended in the ’90s, he closed stores until Crest Hallmark Shops was down to one store in each city. Then, in the early 2000s, he closed the remaining Pasco shop on Court Street near what is now a Goodwill.

Another aspect of the store’s demise is what Jilek refers to as “how people do things.”

For example, Crest Hallmarks used to devote 28 feet of wall space to photo albums, but reduced this to two to three shelves in recent years as photography moved from prints to digital images.

“We lost a huge niche in the marketplace,” he said.

At the company level, Jilek said Hallmark has been forced to adapt its business model to survive. He said Hallmark now sells directly to Amazon and through its own website. It’s also in the process of creating a line of cards specifically for the Dollar Tree chain, Jilek said.

The Richland store has maintained a steady customer flow, thanks to its location along a stretch of the Hanford commute that’s traveled by people living throughout  the Tri-Cities.

Jilek said that based on previous experience, traffic from the Kennewick store should almost directly transfer to the Richland shop.

He said when other Hallmarks closed in nearby Yakima and Oregon, many customers began making the trek to the Tri-Cities, especially for the brand’s signature Keepsake Christmas ornaments.

The Richland store is about the same size as the Kennewick store, and what remains of the core greeting card inventory after the closing sale will be moved to Richland. The remaining surplus that doesn’t sell will be boxed up and donated, Jilek said.

“We have to be down to bare walls by the end of the month,” he said. “It’s just part of retail; there comes a point where you always have stuff that doesn’t sell, even at 90 percent off.”

Jilek said letting his Kennewick store employees go hurts him most.

Each Crest Hallmark store employs three to four part-time employees in addition to the store manager. And there aren’t any open positions at the Richland store to absorb the Kennewick employees.

Melissa Hendricks, the Kennewick store manager of 30 years, said retirement isn’t an option for her, but she hopes to find a way to be involved in the community at her next job. She said she’ll miss the customers most.

So far, there’s no word on what might be moving into the vacated space. Jilek noted the suite next door, a former state-run liquor store, has been vacant for the past three years.

As Jilek looked around the store wistfully, he said, “We’ve had many, many loyal customers over the past 20, 30, 40 years. We’ll miss being here, and I wish it wasn’t the case.”