Should the 99 Cents Only Stores Retail Chain Be Saved?

The discount retail chain 99 Cents Only Stores LLC, commonly known as “99 Cents,” has announced its intention to gradually cease its operations. This decision follows discussions and an agreement with Hilco Global, an asset disposition firm, to liquidate all merchandise and assets across its 371 store locations. The liquidation sales were scheduled to start on April 5. Hilco Real Estate (HRE) will handle the sale of the company’s real estate assets in key states.

Chris Wells from Alvarez & Marsal has been appointed as the chief restructuring officer to oversee this process, while the interim CEO, Mike Simoncic, is stepping down. Simoncic explained that the decision was difficult but necessary due to enduring challenges in the retail sector, including the impact of the COVID-19 pandemic, shifting consumer preferences, increased shrinkage, inflation, and broader economic difficulties. Despite exploring various alternatives, the company concluded that a systematic wind-down was the best approach to maximize asset value.

In response to the announcement of the 99 Cents Only Store closures, communities have flooded locations to stock up on what the retailer has to offer at low prices. With 143 locations in Southern California facing closure, there’s a push to salvage what’s left of this discount haven.

Mark J. Miller, CEO of Pic ‘N’ Save Bargains and former Big Lots president, is spearheading efforts to rescue the chain after the company announced it was closing all stores and winding down its business operations in California, Texas, Arizona, and Nevada. He’s gathered a consortium of investors, including former 99 Cents Store executives, in hopes of acquiring the Southern California stores and maintaining their community service.

“This group of customers is priced out of other chains. It stretches their buying power. Especially today. That’s why this is a passion for me.”

Mark J. Miller via Westside Current

The bustling parking lots and endless checkout queues at 99 Cents Only Stores highlight their significance for budget-conscious shoppers. For many, these stores are essential for stretching tight finances.

Miller remains optimistic, envisioning a revitalized future for the stores. He emphasizes a return to the fundamentals, promising an enhanced shopping experience with a broader range of quality goods at unbeatable prices. Ultimately, he is aiming to “try to [acquire] the Southern California stores, close them for about 90 days after the going-out-of-business sales end and then reopen with an emphasis on the ‘treasure hunt’ style that [made] the stores popular in the first place.”

“It’s a match, that we hope, made in heaven. What I want to make sure is that yes, there’s a big food business at the 99 Cents stores, and that we continue as far as great goods, great prices… great bargains, great treasure hunt items. I want more branded goods at great prices.”

Mark J. Miller via ABC 7 Eyewitness News

The urgency to secure a deal is palpable, both for the business’s survival and the communities it serves. Alongside efforts to reopen stores, local officials are stepping in to support affected employees.

Los Angeles City Councilman Tim McOsker is coordinating with the city’s Economic Workforce Development Department to provide aid, including assistance with unemployment benefits and job placement services.

Los Angeles County Supervisor Janice Hahn is also taking action, proposing measures during the next board meeting to aid displaced workers. She seeks a comprehensive report outlining strategies to assist employees in transitioning to new employment opportunities.

Furthermore, 99 Cents Only has announced bankruptcy as it gets ready to close its doors. The company filed for Chapter 11 bankruptcy on Monday. This decision follows the recent announcement of the closure of all its locations in the region. While the stores remain open for now, 99 Cents Only is conducting going-out-of-business sales with significantly reduced prices.