The national chain of 99 Cents Only Stores, which has 371 stores in four states, is shutting down, with operators citing out-of-control inflation and theft.
“This was a very difficult decision and not the outcome we expected or hoped to achieve,” 99 Cents Only Store interim CEO Mike Simoncic said Friday. Ta.
Simonick cited several factors for the closure, including the “unprecedented impact” of the coronavirus pandemic, changes in consumer demand, continued inflationary pressures and rising shrinkage levels. Shrink is an industry term for inventory lost due to shoplifting, employee theft, or paperwork. error.
Together, these issues have “significantly disrupted the company’s ability to operate,” Simoncic said.
“99 Cents Only Stores, in collaboration with our financial and legal advisors, has extensively analyzed all available and credible alternatives to identify solutions that will allow us to continue our business. These Alternatives “After actively pursuing this option for several months, the company ultimately determined that an orderly wind-down was necessary and the best way to maximize the value of 99 Cents Only Stores’ assets,” he said. Ta.
The move affects 371 of the company’s locations in California, Arizona, Nevada and Texas.
99 Cents Only Stores has already begun the process of closing, with stores beginning to clear and dispose of inventory on Friday.
The popular chain had just celebrated 42 years in business when officials decided to close.
The 99 Cents Only Store joins the growing list of staple businesses enduring the pressures of increasing inflation.
Last month, just before raising its price cap to $7, Dollar Tree announced it would close 1,000 stores between its namesake general discount store and subsidiary chain Family Dollar.
Macy’s also announced plans to close 150 stores, or about 30% of its namesake chain in the United States.
Inflation remains high, but well below the 40-year high of 9.1% in 2022.
The consumer price index, which measures changes in the cost of everyday goods and services, rose to 3.2% in February, one notch above the 3.1% headline inflation rate forecast by economists surveyed by FactSet.
Last week, the Core Personal Consumption Expenditure Index (a Fed-recommended measure of inflation that excludes volatile food and energy prices) rose 0.3% in February and 2.8% from a year earlier, reflecting the difficulty of controlling prices. highlighted.
