Big Lots, a discount retailer, is closing more than 300 locations across the United States, which is roughly a quarter of its stores. The decision comes after the company previously announced plans to close 40 stores due to a 10% decrease in sales and a $205 million loss for the quarter. The closures are part of an updated loan agreement to secure the company’s finances, although a specific list of stores was not provided. The company is undergoing a review of its store footprint to ensure it is best positioned to serve customers and improve business operations.
While a majority of Big Lots stores are profitable, the company is making the difficult decision to close underperforming locations. CEO Bruce Thorn acknowledged that the company missed sales goals due to a pullback in consumer spending on high-ticket discretionary items. Despite the challenges, Big Lots remains confident that the steps being taken will position the company for success in the future. The company is focusing on owning the bargain space and delivering value to customers as it moves forward.
A recent regulatory filing revealed a more dire outlook for Big Lots, stating there is a significant likelihood of a potential default on a 2022 loan and raising doubts about the company’s ability to remain operational. This comes in the face of declining consumer spending on non-essential items, a trend that has impacted many retailers and led to closures of various stores. Online retailers like Amazon have also contributed to the challenges faced by traditional brick-and-mortar stores in today’s market.
In addition to Big Lots, other retailers have also been affected by changing consumer behavior and economic challenges. Conn’s HomePlus, a 134-year-old furniture and electronics retailer, recently filed for bankruptcy and is closing all of its stores. Companies like Bob’s Stores and 99 Cents Only Stores have also gone out of business this year. The retail industry is facing significant shifts, with some companies struggling to adapt to evolving consumer preferences and competition from e-commerce giants.
Shares of Big Lots have taken a hit, down nearly 90% for the year. The company’s financial woes have been exacerbated by the ongoing pandemic and changing retail landscape, leading to the decision to close a significant number of stores. Despite the challenges, Big Lots remains committed to serving its customers and working towards a more sustainable future. The company is focused on delivering value to customers and maintaining a strong presence in the discount retail market as it navigates the changing retail environment.
