Bad Luck, Mistakes Force Swallows' Nest Out Of Business -- Reorganization Didn't Help Outdoors Store

For more than 20 years, Stan Reeve has been president and co-owner of the Swallows' Nest, a 16,000-square-foot outdoor-wear specialty shop at 2308 Sixth Ave. in downtown Seattle.

Many longtime Seattleites had come to recognize the business as a pioneer and national leader when it came to outfitting serious hikers, climbers and skiers.

All of that ended Monday.

After 26 years in business, the Swallows' Nest has closed. The company filed for Chapter 11 bankruptcy reorganization in June and emerged in October with a court-approved financial plan.

But Reeve said key suppliers were unwilling to extend credit. And investors willing to help out were also in short supply.

"We were a major player," Reeve said. "But we ran into some credit problems. We just had some back-to-back hits."

Those hits included bad luck and a series of expensive mistakes.

The company was forced to move to Sixth Avenue in the early 1990s because its previous location near Lake Union was scheduled to be demolished.

The Swallows' Nest also tried to launch an unsuccessful catalog operation that closed two years ago. And a joint venture to open two stores in Japan also failed.

Last week, when it became apparent that the end was near, the store contacted longtime customers and held a weeklong going-out-of-business sale that ended Monday. About 30 employees, most of them full-time, lost their jobs.

Reeve said declining demand for expensive outerwear, skis and ski apparel will make business difficult for many specialty shops.

"The industry is soft right now," Reeve said. "People aren't skiing. The industry isn't dying. It's just in one of its valleys."

Lock Miller, president of Marmot Mountain Supplies in Bellevue, said watching the Swallows' Nest go under is painful.

"It makes me sad, even though they're a competitor," Miller said. "It does not bode well for the industry."

Miller said the market for skis, climbing apparel and other outdoor wear is declining for a variety of reasons.

For example, more young people are snowboarding instead of skiing. People also are using indoor climbing walls instead of going to the mountains. More people are going on day hikes instead of taking long weekends. And an increasing number of retailers such as Nordstrom, REI and even Costco are selling outdoor gear at lower prices.

But despite these challenges, Miller said there always will be room for specialty retailers who pay attention to the market and take care not to become overextended.

"There are still reasons for a specialty shop," Miller said. But to be successful, such stores must develop a plan, "stick to it and not wander into areas that will create a large potential liability."

Reeve said he and a few other former Swallows' Nest employees will be around cleaning up their old space and saying goodbye to 26 years of history.

"There's just nothing much to say," Reeve said sadly. "This is not something I enjoy."