Big Lots is launching a “pantry optimization initiative” in September, amping up the amount of consumables it sells including store brand items.
"This initiative repositions our food and consumables square footage from food staples to food entertainment and consumables," Big Lots CEO Bruce Thorn said during a recent first quarter earnings call. "The assortment will include national brands along with everyday low prices coupled with owned brands and closeouts. This offering will allow more of our customers to find more of the items on their shopping list, which will also increase trips."
Thorn said Big Lots is "positioned to win going forward" in attracting consumers who are staying home and looking for pantry essentials, and also consumers in financial distress looking for deals.
"Our merchandising mix is exactly what consumers want and need today, filled with food, consumables and stay-at-home assortments with structurally sound margins," Thorn said. "Our loyal customer base has increased in size over the last few months."
For the first quarter ended May 2, Big Lots reported net income of $49.3 million, or $1.26 per diluted share, compared to adjusted net income of $37 million, or 92 cents per diluted share (non-GAAP), for the first quarter of fiscal 2019. The higher profits come even as the pandemic has resulted in the company increasing wages and spending more money on store cleaning.
Net sales for the first quarter of fiscal 2020 totaled $1,439 million, an 11.1% increase compared to $1,296 million for the same period last year, with the growth resulting from an impressive 10.3% increase in same-store sales and sales growth from new and relocated non-comp stores.
See more coverage on Big Lots quarter in this article at sister publication Progressive Grocer.