Big Lots will officially close the doors of its last 18 stores. While this announcement was already made a few months ago, it looked like the company would be able to survive after filing for Chapter 11 bankruptcy on September 9, 2024 by being absorbed by Nexus Capital Management. Regrettably, the $760 million deal seems to have gone south, and the iconic retailer will be disappearing soon with no more hope to come back.
As many companies have done before, Big Lots was hoping to use the bankruptcy filing as a way to reset and get its financial situation under control, but instead, the failed sale triggered the liquidation of all 1,392 stores. There was another attempt to make things right thanks to an agreement with Gordon Brothers Retail Partners, reached on December 27, which would have allowed them to transfer the majority of their assets, including its stores, distribution centers, and even its branding rights to other chains in order to avoid the total destruction of their labor force, but this plan also fell through.
Sadly, what this means for Big Lots and their employees is that there are no more second chances and now all that is left is to pack up and go home.
Big Lots, not the only victim of the new way of doing business
As disheartening as this is, they are not the only retailers going through a tough time lately. In fact, it seems like more often than not these days we hear stories about retail giants that were former industry heavyweights closing down their locations or even disappearing completely. One of the most dramatic examples is Rite Aid a traditional American pharmacy chain that has been serving the public for decades.
Rite Aid filed for Chapter 11 bankruptcy for the first time in October 2023, but by that time it was too late and the company was already in heavy debt with creditors clamoring for their money and a lot of lawsuits being filed against them because of their part on the opioid crisis. They fought hard, even closing down about 800 out of their 2,100 locations, but it was not enough to change the situation.
Rite Aid even tried to change its name to improve the situation, operating under the name New Rite Aid LLC, but on May 5, 2025 they filed for Chapter 11 again and drew up a new plan which involved shutting down all remaining operations and selling off whatever assets were left.
As of July 10 and 11, court filings in New Jersey show that Rite Aid has asked to close and liquidate the rest of its stores, which would be on top of the 1,202 closures the company had already completed, leaving only a few dozen locations still standing. Even those few locations are expected to close soon, as the company files more notices and clears out its final inventory.
While the end of Big Lots and Rite Aid are newsworthy, they are part of a bigger trend that has been going through the retail sector since late 2024. Other big industry names like Party City, Joann Fabrics, Forever 21 and Michaels have filed for bankruptcy and closed within a few months leaving loyal customers bereft and wondering what happened to their favorite stores.
The reasons are numerous, with many blaming inflation, as it has been affecting profits, but it is not just that, labor costs are up, borrowing money is more expensive, and retail theft is on the rise. Plus, the rise of online shopping and Chinese low cost retailers have meant that keeping up with having physical locations is too pricey for most of these companies and they have been forced to shut down.