Ohio-based discount retailer Big Lots continues its struggle under Chapter 11 bankruptcy protection, with recent court filings suggesting additional store closures on the horizon.
Recent Developments in the Bankruptcy Case
As part of its bankruptcy proceedings, Big Lots has filed a fifth notice in U.S. Bankruptcy Court for the District of Delaware, proposing the closure of 19 more stores across the United States. These closures span multiple states, including:
- California: 5 stores
- Texas: 3 stores
- Oregon: 3 stores
- Florida: 2 stores
- Nevada: 2 stores
- Georgia, Idaho, Arizona, and Washington: 1 store each
Affected cities include major metropolitan areas such as Los Angeles, Atlanta, Phoenix, and Orlando. Unless an objection is filed by Saturday at 4 p.m. ET, or the court intervenes, Big Lots will begin the process of closing sales for these locations.
A Wider Strategy of Downsizing
The company had previously announced plans to shutter nearly 500 stores, with 140 already closed as of now. This decision is part of Big Lots’ broader strategy to stabilize its finances amidst declining sales and rising debt. According to filings with the Securities and Exchange Commission, high inflation and intense competition have severely impacted the retailer’s ability to attract consumers.
California has been hit particularly hard, with 75 out of 109 stores slated for closure by January 2025.
Financial Challenges and Bankruptcy Filing
Big Lots initially filed for Chapter 11 bankruptcy on September 9, 2024. At the time, the retailer operated approximately 1,300 stores, but that number has been steadily declining. Financial reports reveal that the company recorded a $205 million net loss for Q1 2024 and accumulated long-term debt totaling $573.8 million.
In connection with its bankruptcy, Big Lots reached a sale agreement with Nexus Capital Management. The deal, valued at $760 million, includes cash payments, debt payoff, and assumption of liabilities.
Store Closures in Progress
Here is a list of the 19 stores set to close:
- Porter, Texas: 23741 Highway 59 Ste 30
- Fort Walton Beach, Florida: 111 Racetrack Road NW
- San Antonio, Texas: 3715 Colony Drive
- Atlanta, Georgia: 3358 Chamblee Tucker Road
- Meridian, Idaho: 100 East Fairview Avenue
- Redondo Beach, California: 1207 Aviation Boulevard
- Phoenix, Arizona: 3543 West Thunderbird Road
- Webster, Texas: 1201 West Nasa Parkway
- Murrieta, California: 25260 Madison Avenue
- Los Angeles, California: 1815 West Slauson Avenue
- Medford, Oregon: 1070 Biddle Road
- Hermiston, Oregon: 930 South Highway 395 Ste A
- Tulare, California: 1675 Hillman Street
- Moses Lake, Washington: 813 North Stratford Road
- Las Vegas, Nevada: 7781 West Tropical Parkway
- Bakersfield, California: 4751 White Lane
- Roseburg, Oregon: 1350 NE Stephens Street Ste 50
- Sparks, Nevada: 1300 Disc Drive
- Orlando, Florida: 2544 East Colonial Drive
What’s Next for Big Lots?
While Big Lots asserts that most of its stores remain profitable, the closures aim to improve overall operational efficiency. This downsizing effort will allow the company to focus resources on profitable locations while navigating its challenging financial landscape.
The retailer’s struggle reflects broader issues facing the retail industry, including reduced consumer spending, inflation, and heightened competition from e-commerce platforms.
For customers and stakeholders, the fate of remaining stores hinges on the success of Big Lots’ restructuring efforts and their ability to navigate these financial hurdles effectively.
