Shelves are beginning to empty at branches of hardware chain Ace, with many suppliers refusing to deal with the embattled DIY store.

The 36-store DIY chain received a court order protecting it from creditors last week. It is NIS 450 million in debt, including the NIS 183 million it owes bondholders. "In the meantime they're stocking themselves from their warehouses, but many suppliers are refusing to bring more products," said a senior executive from a company that works with the chain.

"At some branches," the executive added, "shelves are covered with sheeting, like grocery stores do during Passover. That apparently is the work of suppliers who don't want customers to buy their products."

The suppliers believe they won't get any money from the store for products that sell, and so long as the stay of proceedings is in effect, they don't have any way to sue.

Store managers have been instructed to call the police if suppliers come to reclaim their products.

In response, Ace stated that its suppliers are still delivering goods and that they know the company's trustee would ensure that they receive their money.

From the customers' perspective, the problems are most evident in the furniture department. Store employees have been forced to admit to customers who made down payments that there's no saying when - or if - they'll receive their order, said the executive.

Products purchased before the stay of proceedings went into effect on January 18 cannot be exchanged or returned, explained customer service staff at the Tel Aviv Port store. This was in keeping with the court's orders, they added.

However, one reporter observed that a man who spent enough time yelling with that store's customer service staff was indeed allowed to return a product in exchange for store credit.

Anything purchased after January 18 can be exchanged or returned.

Another executive who works with Ace said that at this rate, the chain was likely to run out of merchandise within a few days.

There were noticeably fewer customers at some branches.

The chain is offering aggressive discounts because the company's trustee wants to boost sales and bring in as much cash as possible, said a salesman at a Tel Aviv branch. For example, a set of shower parts was selling for NIS 40, down from the full price of NIS 155.

Employees are already feeling the fallout, said one source. Ace's cleaning contractor has stopped sending cleaning staff, so at some branches the sales staff is picking up the slack. Store managers lost their cellphones and their gas station cards, the source added.

In a rare move, last week's request for the stay of proceedings came from Ace's executives and board of directors, contrary to the wishes of the controlling shareholders. It is in effect until Thursday.