Wednesday, May 29, 2024

Company Man asks 'The Decline of 99 Cents Only Stores...What Happened?' A tale of the Retail Apocalypse

For "another post that will be worth sharing next month," I'm turning again to the Retail Apocalypse with Company Man asking The Decline of 99 Cents Only Stores...What Happened?

The west coast chain of dollar stores is reportedly filing for bankruptcy and shutting down all their stores. This video attempts to identify the biggest reasons behind their failure.
Company Man Mike summarized the reasons for the chains troubles and eventual closing in the following table.

Erik of Retail Archaeology mentioned the leveraged buyout as a major culprit in his video, 99 Cents Only Stores: All Stores Closing!

In this episode we check out the liquidation of 99 Cents Only Stores.
As I wrote most recently in Company Man asks 'The Decline of Red Lobster...What Happened?' A tale of the Retail Apocalypse, "I listed a who's who of retail chains gutted by private equity in CNN Business explains retail bankruptcies and how private equity is gutting retail, tales of the Retail Apocalypse and again in Business Insider and CNBC explain the rise and fall of Chuck E. Cheese, a tale of the Retail Apocalypse and pandemic." The debt left behind by the leveraged buyout hurt the chain's cash flow afterwards, which Company Man Mike illustrated and which Erik blamed as the major reason for the chain's liquidation.

The rescue plan mentioned in both videos apparently didn't come to fruition, but the Orange County Register recently reported another one did: Dollar Tree lines up to buy 93 shuttered 99 Cents Only stores in California.
Dollar Tree is reportedly the winning bidder for at least 93 of the chain’s discount stores spread across the state, according to reports from the brokerage Retail Specialists. Most of the stores are in Southern California.
The bids and the undisclosed terms are subject to court approval.
At least the locations will be open, although I'd be surprised if Dollar Tree maintains the grocery departments. This is happening as Dollar Tree announced plans to close 1,000 locations by next year. That's a story for another time, as is Red Lobster finally filing for bankruptcy. Stay tuned.

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