Usually, when a retail chain hires a liquidation firm, that's the end. Recent history has shown that the brand name may come back, and in some cases some form of physical stores may reappear years later, but it's usually in a very different form.
Once a company decides to liquidate it has generally pursued every opportunity to keep operating, That includes looking for new forms of funding and seeing whether anyone might want to buy the assets.
Related: Popular shoe brand files for Chapter 11 bankruptcy
David's Bridal, for example, filed for Chapter 11 bankruptcy and stood on the brink of going out of business when an investor stepped in and took over the brand. In the cases of Christmas Tree Shops, Tuesday Morning and Bed Bath & Beyond, that did not happen.
All three of those popular retailers explored all their options and ended up bringing in a liquidation firm to sell off their remaining assets. Once that happened, the three — at least in the form we knew them as brick-and-mortar retailers — closed and went away.
That appeared to be what was happening with 99 Cents Only Stores, as the company has hired Hilco Global, a liquidation firm, to handle a wind-down of its operations.
That may not, however, be the end of the story.
Image source: TheStreet
99 Cents Only stores winding down operations
99 Cents Only outlined plans to wind down operations and close all its stores in an April 4 posting on its website.
"The company has entered into an agreement with Hilco Global to, among other things, liquidate all merchandise owned by the company and dispose of certain fixtures, furnishings, and equipment at the company's stores," according to the posting. "Sales under this agreement are expected to begin April 5, 2024, and will be carried out at all 371 of the company's store locations."
In addition, the bankrupt chain has taken steps to sell off its real estate assets.
"Hilco Real Estate is managing the sale of the company's real estate assets, both owned and leased, in Arizona, California, Nevada and Texas," the company shared.
99 Cents Only has a deep history and connection to the communities it operates in. Unlike many low-cost retailers, the chain sells fresh produce and other items not associated with the dollar-store model.
"Founded in 1982, 99 Cents Only Stores LLC currently operates nearly 371 stores located in California, Texas, Arizona, and Nevada. 99 Cents Only Stores LLC offers a broad assortment of name brand and other attractively priced merchandise and compelling seasonal product offerings," the chain posted on its website.
99 Cents Only may get a lifeline
A former value retail chain executive has put together a consortium that hopes to rescue a part of the 99 Cents Only chain.
"Former president of Big Lots and Pic `N' Save, Mark J. Miller, leads efforts to save 143 Southern California 99 Cents Only stores," the Westside Current reported. "Miller aims to acquire stores with group of investors, including former 99 Cents Store executives, and rebrand with emphasis on 'treasure hunt' style."
Because the company has formally filed for Chapter 11 bankruptcy, the court would have to approve any sale. In cases like David's Bridal, bankruptcy courts have generally favored bids that would keep stores open.
"It's a passion for me to try and do this deal because I think it's such an iconic brand name and has such a great feel for Southern California," Miller told Los Angeles Magazine.
Miller had been working for about 90 days on putting together his bid in order to acquire the company. The Chapter 11 filing complicates, but does not end, those efforts.
He says that saving these stores is essential for the communities they serve.
"This group of customers is priced out of other chains," Miller said. "It stretches their buying power. Especially today. That's why this is a passion for me."
