LA-Based 99 Cents Only Stores Announce All 371 Stores Nationwide Will Be Closed Down

City of Commerce-Based 99 Cent Only Stores announced on Thursday that the company will be shut down, with store closures and complete liquidation occurring at all 371 locations across California, Arizona, Nevada, and Texas.

Founded in Los Angeles in 1982 by Dave Gold, 99 Cent Only Stores quickly spread across California and neighboring states throughout the 80s and 90s. At times even TVs were sold at 99 cents for special offers, and in 1996, the initial stock IPO was sold for the same amount. Thee 99 cents only model stood firm until the Great Recession in the late 2000’s when prices rose above 99 cents because of rising costs and many stores, mainly in Texas, began closing. While the stores stayed afloat in the 2010’s, with the company going back to being private during this time, the 2020’s brought a new set of challenges.

Inflation, the COVID-19 pandemic, greatly increased losses because of thefts, and consumer demand for cheaper products going towards places such as Dollar General and other dollar stores hurt the business in the 2020’s. By 2023, the company was close to announcing chapter 11 bankruptcy. Finally, on Thursday, the company announced that they would soon shutter, closing all 371 stores and causing around 14,000 workers to lose their jobs. Over 200 of the stores that will be closed are in California, with thousands of workers in California soon to be out of a job.

“This was an extremely difficult decision and is not the outcome we expected or hoped to achieve,” said CEO Mike Simoncic on Thursday in a statement. “Unfortunately, the last several years have presented significant and lasting challenges in the retail environment, including the unprecedented impact of the COVID-19 pandemic, shifting consumer demand, rising levels of shrink, persistent inflationary pressures and other macroeconomic headwinds, all of which have greatly hindered the Company’s ability to operate. We deeply appreciate the dedicated employees, customers, partners, and communities who have collectively supported 99 Cents Only Stores for decades.”

Final store shutdown dates have yet to be announced, but it is expected to happen soon as a firm in charge of store liquification has already been assigned. According to retail experts, 99 Cent Only Stores failed to reach a model compatible with modern shoppers and suffered more than they had let on in recent years.

371 stores to close

“That was an interesting statement they put out,” Cheryl Rubin, a retail company researcher who focuses on failing retail chain stores, told the Globe Friday. “99 Cent Only Stores have been struggling even before the pandemic, but they still carried on. Before the pandemic they were still doing things like sponsoring promotions at sporting events and sponsoring local charity drives and things like that that cost a bit of money. The Great Recession hurt them, but they made it through, with customers needing to spend less fueling them.”

“But after the Great Recession, stores like the Dollar Tree, Family Dollar, and Dollar General began these aggressive new marketing strategies and campaigns focused on reduced costs and cheap prices. I mean, those places have their issues. Dollar General in particular is at an even bigger nightmare scenario right now than the 99 Cent Only Stores ever were. But they had all adapted. 99 Cents did not.”

“Inflation they can’t do anything about, but the other big reason there “rising levels of shrink”. You know what that means? It can mean things like damages, but for these stores, that is code for shoplifting. And since these stores had such low margins and product cheapness, security measures were not put into place, or at least not any fancy ones. You know, food stores have cameras, scanners at the exit. Maybe some places have things behind a key or a security guard out front. 99 Cent Only Stores struggled with that reality, so losses were huge.”

“And you’re right about job losses. In other areas of the state, job losses have been high. San Francisco lost tens of thousands in only the last few months. The 99 Cents Only Stores epicenter, LA, they had a gain of 9,400 over the past year. Inland Empire is even better. They aren’t huge gains or anything, but they are still in good growth shape. Losing thousands of employees is going to hurt these figures.”

“And finally, these stores attracted a lot of lower income people. Those people are a bit more left behind now. Everyone is a bit responsible for their demise.”

Final store closure dates are expected to be announced soon.