Store Closures On The Way At Big Lots
Big Lots will soon be smaller in size as the closeout retailer will shut more than 300 stores in the coming week.
While no formal press announcement was made regarding its downsizing, the retailer outlined its plans in a filing with the Securities and Exchange Commission. Big Lots earlier this year had discussed closing upwards of 40 locations. Prior to the closures, the retailer operated nearly 1,400 stores across the U.S.
According to a report from Chain Store Age, a sister publication of Store Brands, California will see the most stores closed as 75 of its 109 locations in the state have been selected for closure.
Additionally, the struggling retailer said in the SEC filing it has reached an agreement with lenders to reduce its available credit from $900 million to $800 million and take an interest rate hike of 50 basis points.
In April, following the announcement of an increase in its borrowing capacity through an affiliate of Gordon Brothers Capital, Jonathan Ramsden, Big Lots’ chief financial and administrative officer, said the company was fully committed to improving its results and returning the company to health and prosperity.
"The financing announced today gives us additional flexibility as we continue our focus on delivering extreme bargains and unmistakable value to our customers,” he said at that time. “We are confident that our five key actions will drive significant improvement in sales and gross margin in the coming quarters."
The struggles at Big Lots are not new as the retailer’s most recent fiscal report revealed. Sales during the first quarter were down 10.2% to $1 billion, with comparable store sales off 9.9%. Despite consumers turning to discount retailers to save money, Big Lots officials cited continued pullback in consumer spending by its core customers as the main reason for the quarterly decline.
