The longtime family-owned department store Belk has been sold to a New York investment firm. This ends the 125-year family operation of a retail giant that originated in North Carolina. NC State University economist Mike Walden comments on reasons for the sale.
“Well, this is a big deal. Belk at its peak had 400 stores all across the Southeast, and they did something unique when they went into a new market: They often teamed with a local family — so, for example, here in Raleigh it was Hudson-Belk; in Roanoke Rapids, it was Belk-Leggett; in Concord, it was Parks-Belk.
“So I think this is a shock to many people, because they grew up shopping at Belk, and although the new owners say they aren’t going to make any changes, I think everyone knows that at some point they are going to downsize the number of stores and maybe even change the name.
“Well, your question is, What happened? Well, I think this is an issue that has affected all retailing. Number one, young households especially are not going to stores. They are not going to brick-and-mortar stores. They are buying online. They’re also not going to large department stores, nationalized stores. They want to go to quirky — they want to go to specialty stores. So I think the buying public has changed.
“I think the fact that our economy has become more nationalized — homogenized, if you will — has hurt some regional retailers who maybe catered to specific characteristics in that region. Those differences in characteristics are now going away.
“And then something I think very interesting to family-run operations: There’s been a lot of research done that shows it’s really hard to perpetuate family ownership. In fact, by the time you get to the third generation of a family running a store, most of them want to go on and do other things. And Belk was already into their third generation, and actually no one in the fourth generation was in top management. So I think there was a sign there that maybe the family simply wanted to go in a different direction.”