99 Cents Only Stores

99 Cents Only Stores LLC
Company typePrivate
IndustryDiscount, variety store
Founded1982 (1982), in Los Angeles, California, United States
FounderDave Gold
DefunctJune 5, 2024 (2024-06-05)
FateChapter 11 bankruptcy in April 2024
Headquarters
Commerce, California
,
United States
Number of locations
371 (at the announcement of its eventual closure)
Area served
United States (locations in California, Texas, Arizona, and Nevada)
Key people
  • Barry J. Feld (CEO)
  • Mike Simoncic (Interim CEO)
  • Jesse Allen (COO)
  • Perry Pericleous (CFO)
RevenueIncrease $2.06 billion (2017)
Decrease $53 million (2017)
Decrease $118 million (2017)
Total assetsIncrease $662.87 million (2009)
Total equityDecrease $523.85 million (2009)
Number of employees
14,000 (2024)
WebsiteArchive of 99only.com
99 Cents Only Store in Dallas

99 Cents Only Stores LLC (also branded as The 99 Store[1]) was an American price-point retailer chain based in Commerce, California. It offered "a combination of closeout branded merchandise, general merchandise and fresh foods." The store initially offered all products for 99¢ or less.[2] The base price became 99.99¢ in 2007 and products were later introduced at higher prices.

Founded by Dave Gold in 1982, the retailer chain had locations in California, Arizona, Nevada, and Texas. The company also operated Bargain Wholesale, which sells wholesale to retailers across the United States and exports to more than 15 countries from showrooms in Los Angeles. It also exhibited at trade shows in Las Vegas, Nevada and Chicago, Illinois. The company announced all stores would close beginning April 5, 2024 and culminated on June 3, 2024 due to financial hardship.

History

99 Cents Only Store, North Hollywood, California

Early history

"99 Cents Only Stores" dates back to the 1960s when its founder, Dave Gold, inherited a liquor store at Grand Central Market,[3] in downtown Los Angeles, and experimented with selling bottles of wine at a fixed price-point of 99 cents. The test was successful, and Dave realized that selling everything in the store for 99 cents would make his business stand out.[4]

"Whenever I'd put wine or cheese on sale for $1.02 or 98 cents, it never sold out," Gold said in a 2001 interview with The Los Angeles Times. "When I put a 99 cent sign on anything, it was gone in no time. I realized it was a magic number."[5]

On August 13, 1982, Dave and Sherry Gold opened the first 99 Cents Only Store at 6921 La Tijera Boulevard,[6] in Inglewood, California near Los Angeles International Airport.[7] To celebrate the grand opening, Dave decided to sell television sets for only 99 cents to the first 13 families.[8] More than 300 people showed up in line, catching the attention of more than 10 TV outlets covering the store’s first day. Inspired by the first grand opening, new stores began offering 99-cents deals for televisions and other products.[4]

In 1996, when the company went public, Dave Gold insisted that the offering price end in 99 cents. "We weren't even sure that the FTC would allow it," said Jeff Holmes, whose firm managed the IPO.[9]

2000s

A typical interior of a 99 Cents Only Store location around this time period

In November 2003, the store began selling items for lower than 99 cents (e.g. 69 or 49 cents). The management believed that it would permit better management of commodity price increases.[10]

In September 2007, the company raised its prices by $0.0099 (from 99 cents to 99.99 cents), marking the first increase in the history of the franchise—to combat "dramatically rising costs and inflation."[11][12] The store later carried some items which were over the .9999 price point; such as $1.99 and $2.99.

On September 18, 2008, it was announced that the company would close all stores in Texas, but in February 2009, the company decided on closing just one-third of its Texas stores. The company quoted a rise in sales, promising to keep the stores open, as long as they remained profitable.[11][13]

2010s

99 Cents Only store in Ontario, California with The 99 Store branding

In October 2011, the company agreed to a $1.6-billion buy-out by private equity firm Ares Management and the CPP Investment Board.[14] The deal was completed on January 13, 2012. The new owners decided to lay off over 172 employees in October 2013.[15] The Gold family had ended their involvement with the company in January 2013 and Dave Gold died on April 22, 2013.

99 Cents Only store having a liquidation sale in Reseda, Los Angeles

2020s

In September 2023, 99 Cents Only Stores announced that they sold their Los Angeles County warehouse.[16] In October 2023, Fitch Ratings reported that 99 Cents Only Stores was nearing a potential Chapter 11 bankruptcy filing.[17]

A sign promoting a 30% off sale at a 99 Cents Only Store in Reseda, California on April 14, 2024 due to it closing due to the bankruptcy

On March 28, 2024, the company warned that it may be forced to file for Chapter 11 bankruptcy within weeks as it faced a liquidity shortfall and a stalled-asset sale. It also began talks referring to liquidation.[18]

On April 4, 2024, 99 Cents Only Stores announced that it would permanently close all of its remaining 371 locations and lay off its 14,000 employees within the coming months, with liquidation sales to be held by Hilco Global.[19] "Going out of business" sales began at all locations on April 5, with stores expected to complete liquidation sales by June. The company blamed the effects of the COVID-19 pandemic, increasing inflation, and shifting consumer demand.[20]

On April 8, 2024, 99 Cents Only Stores filed for Chapter 11 bankruptcy, listing total liabilities and assets between $1 billion and $10 billion. The company also stated that it has gathered $60 million to facilitate its shutdown process and also planned on a sale on its assets and leases.[21]

Store acquisitions

On April 7, 2024, Mark J. Miller, CEO of Pic 'N' Save Bargains and former president of Big Lots, planned to save the discount chain after the company announced it was closing all stores and winding down its business operations in California, Texas, Arizona and Nevada. Miller said he has put together a group of investors, including some former 99 Cents Only Stores executives, to try to acquire the Southern California stores and continue the chain's commitment to the community. The affected stores would temporarily close for up to 90 days after liquidation sales are complete to make way for renovations and restocking, and then reopen soon after.[22]

On May 24, 2024, Ollie's Bargain Outlet announced that they had acquired 11 former 99 Cents Only leases, which reopened as Ollie's Bargain Outlet stores by the end of 2024.[23]

On May 29, 2024, Dollar Tree announced that they had purchased the leases of up to 170 of closed 99 Cents Only locations across four states. The company reopened the closed locations as Dollar Tree stores beginning in Fall 2024.[24]

See also

References

  1. ^"Bring Home More! Redeem This Coupon at the 99 Store". 99 Cents Only Stores. Archived from the original on September 21, 2021. Retrieved September 21, 2021.
  2. ^Chang, Andrea (July 22, 2010). "99 Cents Only Stores sued over price increase". Los Angeles Times. Archived from the original on May 1, 2011. Retrieved November 21, 2010.
  3. ^"99 Cents Only was an L.A. Icon. Inside the fall of the popular chain". Los Angeles Times. April 10, 2024.
  4. ^ ab"About Us". 99only.com | 99 Cents Only Stores. Archived from the original on April 26, 2024. Retrieved April 26, 2024.
  5. ^Li, Shan (April 26, 2013). "Dave Gold dies at 80; entrepreneur behind 99 Cents Only chain". Los Angeles Times. Archived from the original on December 22, 2015. Retrieved December 20, 2015.
  6. ^"New owners buy 99 Cents Only Stores". May 23, 2024.
  7. ^"Buy low, live high". Los Angeles Times. January 4, 2003.
  8. ^Chang, Andrea; Darmiento, Laurence (April 10, 2024). "99 Cents Only was an L.A. icon. Inside the fall of the popular chain". Los Angeles Times. Retrieved April 10, 2024.
  9. ^Brott, Tamar (August 1, 2001). "The Price Is Right". Los Angeles Magazine. 46 (8): 42, 44, 46, 48, 50, 52, 54. ISSN 1522-9149. Archived from the original on April 5, 2024. Retrieved April 5, 2024.
  10. ^"99 Cents Only Stores(R) Announces a $5.2 Million Loss for the Second Quarter of Fiscal 2008 Ended September 30, 2007". Business Wire (Press release). November 8, 2007. Archived from the original on February 27, 2011. Retrieved May 17, 2015.
  11. ^ abWelch, Creighton A. (September 18, 2008). "99 Cents Only closing all its Texas stores". San Antonio Express-News. Archived from the original on September 20, 2008.
  12. ^Jinks, Beth & Burke, Heather (September 8, 2008). "99 Cents Only Stores Raises Top Price to 99.99 Cents (Update2)". Bloomberg. Archived from the original on June 20, 2015.
  13. ^Halkias, Maria (February 4, 2009). "99 Cents Only Stores to stay open in Texas after all". Dallas Morning News. Archived from the original on April 4, 2009.
  14. ^Chang, Andrea & Li, Shan (October 12, 2011). "99 Cents Only Stores agrees to .6-billion buyout". Los Angeles Times. Archived from the original on October 19, 2011. Retrieved October 17, 2011.
  15. ^"99 Cents Only Stores: NYSE:NDN quotes & news - Google Finance". Google Finance. Archived from the original on May 19, 2015. Retrieved May 17, 2015.
  16. ^Witthaus, Jack (September 13, 2023). "99 Cents Only Stores Sells Los Angeles County Warehouse". CoStar. Retrieved October 3, 2023.
  17. ^"11 retailers at risk of bankruptcy in 2023". Retail Dive. October 2, 2023. Archived from the original on October 2, 2023. Retrieved October 3, 2023.
  18. ^"Retailer 99 Cents Is Mulling a Potential Bankruptcy Filing". Bloomberg. March 28, 2024. Archived from the original on March 28, 2024. Retrieved March 28, 2024.
  19. ^Chang, Andrea; Darmiento, Laurence (April 5, 2024). "99 Cents Only to close all 371 stores and wind down its business". Los Angeles Times. Archived from the original on April 5, 2024. Retrieved April 5, 2024.
  20. ^Maruf, Ramishah (April 4, 2024). "99 Cents Only Stores is winding down its business operations". CNN. Archived from the original on April 5, 2024. Retrieved April 4, 2024.
  21. ^Clanton, Alicia; Wijaya, Megawati; Randles, Jonathan (April 8, 2024). "99 Cents Only Stores Goes Bankrupt as Inflation Keeps Biting". Bloomberg Law. Archived from the original on April 9, 2024. Retrieved April 8, 2024.
  22. ^Youngman, Sam (2024). "Investor Group Looks to Save the 99 Cents Only Stores in Southern California". Los Angeles Magazine. Archived from the original on April 7, 2024. Retrieved April 7, 2024.
  23. ^Russell, Zachary (May 24, 2024). "Ollie's acquires 11 former 99 Cents Only locations". Chain Store Age. Archived from the original on May 31, 2024. Retrieved May 30, 2024.
  24. ^Meyersohn, Nathaniel (May 29, 2024). "Dollar Tree is moving into 99 Cents Only stores". CNN. Archived from the original on May 30, 2024. Retrieved May 30, 2024.
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