Two years ago, Jason Pozzi bet his life savings that he could take the name and basic idea of his parents’ beloved, but recently shuttered D&J Hobby and Crafts store and turn it into a thriving business.

He opened the new D&J Hobby in a different location, a shopping center that looked new and not run down, like the old one. The new store was considerably smaller and didn’t have nearly as much inventory as the old store, but Pozzi tried to turn that to his advantage, focusing on a few categories of products, including remote-controlled cars.

But in the end, Pozzi lost his bet. Rent at the new center was pricey. Competition — from Internet and big box retailers like Amazon and Target that could offer a broader range of products and from specialty stores that could offer a deeper selection of particular goods — was fierce. And then a series of robberies over the summer fatally weakened his business, depleting D&J of popular products during the Father’s Day shopping time and raising his insurance rates and deductible after each theft.

On October 31, Pozzi closed the doors of D&J for the last time. On November 23, he filed for bankruptcy under the Chapter 7 liquidation provisions.

“I feel really bad about this,” Pozzi said. “I really wanted to make this work.”

Pozzi hadn’t taken a salary in six months and had loaned the store $104,613, according to the bankruptcy filings. In the days before he closed the store’s doors for good, he held a sale to try to drum up business.

With the all-important holiday season coming up, Pozzi was just trying to hang on. But in the end, he faced a stark choice: if he kept on operating, he wouldn’t be able to pay his nine employees.

“For me, making that sacrifice is one thing,” he said. “Asking my staff — some might have done it. I have a lot of love for the people who worked for me. But I’m not going to do that.”

When D&J filed for bankruptcy, it had some $44,000 in assets, mostly in the form of inventory, store furnishings and a rent deposit with the shopping center, according to the bankruptcy filing. On the other side of the ledger, it owed more than $535,000, mostly in the form of outstanding rent, the loan to Pozzi and inventory acquired for the store.

The hobby business is a tough one for local, independent stores and many of them have gone out of business in recent years, said Fred Hill, the former president of the Hobby Manufacturers Association. Hill has seen the problem up close; he recently closed one of his two hobby stores in Southern California.

Independent hobby shops are having a difficult time competing with online retailers in particular, because those sellers can offer a wider selection and often have better prices, Hill said.

“In the last two years, it’s been very, very evident they can’t compete with shopping on the Internet,” he said.

Charlie Lindsey said he’d been shopping at D&J — both the old store and the new one — since he first moved to San Jose more than 20 years ago. At the old store, he loved to look at D&J’s collection of model ships and the various science and engineering kits it used to carry. He’d been to the new store, shopping for model rockets, but found its selection disappointing.

Still, Lindsey, 58, was sad to see it close.

“It makes me feel old,” he said. “It makes me think a lot of kids these days are going to miss out on some interesting interests, things that they could do with their hands and with their minds that don’t involve computers.”

Pozzi, too, is sad about the closure. It’s left him broke, jobless and, at age 38, starting over from scratch. But he’s not unhappy that he tried to make it work.

“I learned a lot from the experience,” he said. “You don’t learn from not trying.”

Contact Troy Wolverton at 408-840-4285. Follow him at Twitter.com/troywolv.