Big Lots Found a Partner to Help Keep the Lights On (For Now)

Well, look who’s still kicking. Big Lots, the discount store chain that declared bankruptcy back in September, just pulled a rabbit out of its clearance bin. 

After prepping to close all 963 of its stores (and joining Blockbuster in that great strip mall in the sky), Big Lots announced a new deal that might keep the lights on at a few hundred locations.

So, what happened? Big Lots teamed up with Gordon Brothers Retail Partners, a company that specializes in turning sinking ships into, well, slightly less sinking ships. And now, thanks to a partnership with Variety Wholesalers (the people behind Roses, Maxway, and Bargain Town), up to 400 Big Lots stores might stay open.

Big Lots was ready to shut everything down after a sale to private equity firm Nexus Capital Management fell apart. 

Enter Gordon Brothers, who swooped in like the retail version of a Disney producer saying, “What if we gave it another reboot?”

Variety Wholesalers plans to acquire somewhere between 200 and 400 stores (that’s a big range) and two distribution centers. They’ll keep the Big Lots name alive, which is either a savvy move or like wearing a “Kick Me” sign into a Walmart parking lot.

What’s more, Variety says it might hire some of Big Lots’ employees. That’s corporate-speak for “don’t make any plans yet, but maybe hold off on printing your résumé.”

Big Lots employees were staring down the barrel of layoffs, with 1,000+ jobs on the chopping block nationwide. In Pennsylvania alone, over 500 employees were warned they might be out of work by early January.

Let’s not pretend this bankruptcy was a shocker. Big Lots was already limping along in a world dominated by Amazon’s drone deliveries and Walmart’s everything-for-everyone strategy. Add inflation, rising interest rates, and a public that’s pinching pennies, and it’s no wonder consumers skipped the seasonal throw pillows and “As Seen on TV” gadgets.

Bargain hunters are heading to Walmart, Target, or (let’s be real) just clicking “Buy Now” on Amazon. Even discount chains like Party City and Tuesday Morning couldn’t survive 2024’s retail annihilation. 

The deal with Variety is a lifeline, sure, but it’s no guarantee. Big Lots still has to prove it can exist in a cutthroat retail market where customers want cheap, fast, and convenient. (Three things Big Lots hasn’t been known for.)

Stay tuned. If nothing else, Big Lots has proven it’s not going down without a fight… or at least a decent going-out-of-business sale.

P.S. ICYMI, Prospect Capital CEO John F. Barry just threw down $8.58 million like it’s pocket change to snag 2 million shares of his own company… while the stock’s hanging out near its 52-week low. This power move increases his already ridiculous stake to almost 80 million shares. Oh, and did we mention the 12.6% dividend yield? Yeah, Barry’s either a genius or has the confidence of a guy who knows something the rest of us don’t (I think you know the answer). Want the inside scoop on moves like this? Click here to unlock our Insider Activity Tracker with Stocks.News premium… because if you can’t beat ’em, you might as well follow their trades.

Stock.News has positions in Target, Walmart, Amazon, and Big Lots mentioned in article.