The recession has taken a toll on c-stores in Maine, The Kennebec Journal reported. Albion Variety is one of 56 c-stores in the state that have gone out of business in the past year.
Jeff Leonard, a spokesman for the National Association of Convenience Stores, said Maine’s c-stores decreased from 1,146 to 1,090 in the past year. The first half of 2008 was especially tough for the industry because higher gas prices resulted in a lower store markup, in this case, 2 cents per gallon, he was quoted as saying.
Albion Variety’s owner closed his store in April because he could not restructure his loan with a local bank or establish a loan with two other banks. The owner began noticing a decrease in revenue in January 2008 and by September was falling behind on payments.
Other c-stores in the state closed in Burnham, South China, Hartland, Chesterville, North Anson, Starks, Phillips,
Bingham, Norridgewock, Pittsfield and Kingfield.
Many banks feel their hands are tied. “We have denied some convenience stores loans recently because the financial strength is not there,” explained Bruce Harrington, a commercial lending officer for Merrill Bank in Waterville. “If we had one in our portfolio, we would work with them, but we’re less likely to take one on.”
Harrington said tiny fuel profits are a big problem for convenience-store owners. In addition, people are paying for gas at the pumps, and not going inside for extra purchases.