Áine Cain / Business Insider
Big Lots is shutting down some stores as the retailer moves toward small towns and away from urban areas.
The discount chain's latest closures include stores in urban and suburban parts of California and Colorado. The stores are the latest that Big Lots has shuttered: While it opened 50 new stores in 2022, the number of closings was "similar or slightly higher," CFO Jonathan Ramsden said during an earnings call in December.
Some of those closures are happening because Big Lots plans to sell the store sites, Ramsden said. In other cases, the company is closing locations that it says are "underperforming."
Going into 2023, Big Lots is also trying to increase the number of stores it has in more sparsely-populated areas of the US. In small towns, Ramsden said that Big Lots faces fewer competitors and can operate stores for less money, leading to more profit than its locations in or near major metro areas.
"Our real estate strategy is going to be increasingly oriented towards these rural small town stores where the economics are significantly stronger than in the urban stores," he said.
The changes to Big Lots' store network come as the company faces declining sales. Historically high inflation has hit low-income consumers, Big Lots' primary customer base, particularly hard, CEO Bruce Thorn said in December. That's led many of them to hold off on buying the non-essential items that Big Lots sells, he added.
