Big Lots, the discount retail chain, is facing significant challenges as it embarks on the closure of nearly 400 stores across the United States following its Chapter 11 bankruptcy filing earlier this year. The company, known for offering discounted home goods and groceries, announced this decision, citing various factors including high interest rates and changing consumer habits.
The national chain is set to shutter its last remaining store in Montgomery County, located at 19142 Montgomery Village Avenue. A closing sale is already underway, yet the official date for this location's shutdown remains unconfirmed, with Big Lots indicating it will largely depend on how quickly the inventory clears.
Earlier this month, Big Lots expanded its closure plans, adding nearly 50 stores to the list of those already marked for permanent closure. This brought the total number of closures to about 400, impacting customers across 25 states. According to reports from Cheapism, the closure list underlines the broad-ranging impact of the retail downsizing.
Big Lots employees and community members expressed disappointment over the sudden decision, which has left customers questioning the future of their local stores. Rob Massimiano, Town Commissioner for Elkton, noted the challenges posed by online shopping and the decline of brick-and-mortar retailers. He regarded the closure as “a big loss” for the community.
At the same time, Maryland's Mayor of Rising Sun emphasized the necessity of finding solutions to fill the gaps left by these retail closures, ensuring the communities are not detrimentally affected. This trend follows broader shifts impacting various segments of the retail sector, with Big Lots CEO Bruce Thorn insisting on the necessity for operational efficiency and profitability. "The majority of our store locations are profitable," he said. “But this round of cuts will streamline operations and help us serve our customers more effectively.”
The current liquidation sales at the affected locations have seen mixed reception. Customers have reported discounts ranging from 10% to 20%. Some experienced mixed outcomes when shopping, reporting inflated prices accompanied by deceptive markdowns. Liquidation sales, typically final, add another layer of concern, as shoppers are advised to tread carefully before making purchases if they anticipate potential dissatisfaction. The abrupt shift to sales has left many feeling squeezed as they try to capitalize on deals.
According to updates directly from Big Lots, the company has attempted to secure new financing through various means, including exploring potential sales to private equity, which recently fell through.
This change was particularly notable following the failed sale to Nexus Capital Management, which the retail chain had hoped would provide stability. After this collapse, the urgency of store closures accelerated, leading to the decisions made over festive months.
The reactions from Big Lots shoppers reveal worries about the store's future. During a visit to the Waldorf, Maryland store last fall, it was observable how closeout products filled the aisles, perhaps indicating the chain's emphasis on budget deals. A source from Business Insider stated, "While Big Lots used to enjoy traction with deals, many shoppers are reassessing their shopping preferences with newer alternatives nearby."",
Some locations included on the closure list fall within states hardly impacted by previous closures—those include major urban areas like California’s San Jose and Texas’s Fort Worth. The previously identified store count raises questions about whether there will be avenues for survival or if the discounts can outlast those offered by traditional supermarkets, which show no shortage of competition.
Overall, the future of Big Lots remains uncertain. Although many analysts believe the brand can sustain itself, the pressure to reinvent its business model is substantial. With competition from online retailers, alongside established grocery chains selling similar items at similar prices, finding the magic formula to entice repeat customers will be challenging.
Bruce Thorn's continued optimism hints at the potential for reformed strategies as he stated, "We all have worked extremely hard and have taken every step to complete our intentions for the business." He noted the optimism with which the brand branches would adapt to shifting market demands, but how this will play out remains to be seen.
