After more than 30 years in operation, the popular discount chain 99 Cents Only has announced that all of its 300 stores nationwide will be closing down.
This decision does not only affect the shoppers who rely on the store’s low prices, but it also means job losses for the workers. Currently, all merchandise is being sold at a 30% discount, causing a surge of customers to stock up before the stores permanently shut their doors.
Many residents of South Sacramento, where one of the 99 Cents Only stores is located, expressed their disappointment at losing the store. They praised its affordable prices and convenience in their neighborhood.
However, according to finance professor Dr. Sanjay Varshney from Sacramento State, the closure of bargain stores is a growing trend that poses a significant concern for communities. With the cost of living already high in California, the shutting down of these bargain stores in low-income areas can have a devastating impact on the residents.
The blame for the closures is being attributed to a lack of regulations, Dr. Varshney stated. As companies try to raise their prices to compensate for rising production costs and salaries, they often pass on the burden to consumers.
This is not feasible for a store like 99 Cents Only, which operates on slim profit margins. The employees at the store have shared that they will not receive any severance pay, and were only given a 60-day notice before their impending layoffs.
In a news release, the interim CEO of 99 Cents Only cited several factors that led to the decision to close down the stores. These include challenges in the retail environment over the last several years such as shifting consumer demand, inflationary pressures, and the unprecedented impact of the COVID-19 pandemic. The company’s inability to operate effectively in such conditions ultimately led to this unfortunate outcome.
The first 99 Cents Only store opened in 1982, but the challenging retail landscape has forced the retail chain to wind down its business operations. Dollar Tree, the parent company of 99 Cents Only, has also announced the closing of approximately 600 Family Dollar stores this year. The company has stated that an additional 370 Family Dollar and 30 Dollar Tree stores will shut down once their current leases expire in the coming years.
This means a total loss of thousands of jobs, as Dollar Tree has a substantial workforce with over 211,800 employees across all its stores. With the majority of Americans living paycheck to paycheck, this can have a significant impact on families who are struggling to make ends meet. Despite the promising outlook of the economy, many consumers are still feeling the pinch of rising grocery prices and economic uncertainty under the current administration.
In a statement, Dollar Tree emphasized that their stores are essential for communities across the country and that they owe it to their customers and employees to make strategic decisions for the success of the company. It is evident that the struggling retail environment, coupled with inflation and other economic challenges, has led to the downfall of these discount chains.
Only time will tell if a change in leadership and policies can bring about a more favorable atmosphere for businesses and consumers alike in the future.
