Columbus, Ohio — President and CEO of Big Lots, Bruce Thorn, stated in a letter to staff members that was received by HTT sister journal Furniture Today that the Top 50 company might be profitable again by 2025.
Thorn also mentioned that the chain of cheap stores is probably going to close more locations as part of its current Chapter 11 bankruptcy procedure and deal to sell the company to a Nexus Capital Management subsidiary.
In accordance with section 363 of the U.S. Bankruptcy Code, Big Lots’ assets and continuous business operations are subject to a court-supervised auction procedure.
With an agreed-upon acquisition price of roughly $760 million, which includes $2.5 million in cash plus the debt payback amount and the assumption of certain obligations, Nexus is acting as the stalking horse bidder in the process. Through the Chapter 11 procedure, Nexus’ offer is open to better and higher offers.
The management is confident that Big Lots can achieve profitability by 2025 under the stewardship of Nexus (or an entity that outbids Nexus) and by adhering to its Five Points Forward plan, which focuses on owning the bargain space and providing exceptional value to customers, according to Thorn’s letter to employees outlining the process.
“We firmly believe that we will improve our long-term performance and profitability and serve the best interests of the company by operating under new ownership that believes in our business and provides increased financial stability,” Thorn said.
Thorn informed the staff that as Big Lots proceeds with the process, they should anticipate receiving their regular salary and continuing benefits.
He declared that the business will do all within its power to increase the profitability of each of its locations, even if it means pleading with landlords to obtain rent breaks. However, as part of Big Lots’ ongoing strategy for shop optimization, the process will involve closing more locations. Big Lots had 1,300 locations across 48 states as of May 4, the end of the first quarter.
According to Thorn, the company’s main priorities include making sure the bulk of its stores stay open and that the correct stores are situated in the proper places. He explained that the company considers a number of variables when deciding which locations to close, such as the store’s proximity to other stores, the quality of the property, prospective volume, rent commitments, and the achievement of specific operational and financial goals.
According to Thorn, the amount of store closings is still pending, but they will happen gradually over several months.
Big Lots has been contacted by Furniture Today for additional information.
