After filing for bankruptcy, Big Lots will live on, even if the same buyer does not acquire all of its stores.

After a previous attempt to sell Big Lots to Nexus Capital failed, the chain began holding going-out-of-business sales at its more than 1,400 locations while simultaneously exploring a last-ditch sale.

On Dec. 27, Big Lots announced it had found a buyer for at least some of its assets. The retailer detailed a deal with Boston-based asset liquidation firm Gordon Brothers Retail Partners that would result in the transfer of 200 to 400 Big Lots stores to Variety Wholesalers, Inc. The transaction will enable the transfer of stores, distribution centers and intellectual property to other retailers and companies as well.

Big Lots is currently No. 227 in the Top 1000. The database is Digital Commerce 360’s ranking of North America’s top online retailers by annual web sales. Digital Commerce 360 projects that Big Lots ecommerce sales will reach $389.36 million in 2024.

Who is acquiring Big Lots assets?

Variety Wholesalers of Hendersonville, North Carolina, owns more than 400 stores in the Mid-Atlantic and Southeast; among the chains it operates are Roses, Roses Express, Maxway, Bill’s Dollar Stores and Bargain Town.

Variety Wholesalers plans to operate the acquired stores in the deal under the Big Lots brand and may employ current Big Lots employees at the stores and the one or two Big Lots distribution centers that it plans to acquire.

“The strategic sale to Gordon Brothers and the transfer to Variety Wholesalers is a favorable and significant achievement for Big Lots that reflects the tireless work and collective effort of our team,” said Bruce Thorn, president and chief executive officer at Big Lots.

Thorn added that the sale agreement and transfer present the retailer’s best opportunity to ensure the continuity of the Big Lots brand.

Big Lots’ post-bankruptcy future

“We are grateful to our associates nationwide for their grit and resilience throughout this process,” Thorn stated.

Meanwhile, Gordon Brothers asserted its own commitment to Big Lots shoppers.

“We are pleased to reach this strategic agreement with Big Lots and partner with Variety Wholesalers to achieve a path forward that allows Big Lots to continue to serve customers with extreme bargains and an outstanding shopping experience,” said Rick Edwards, head of North America retail at Gordon Brothers Retail Partners.

Big Lots did not indicate whether Thorn would be a part of the transition. Thorn is an industry veteran, previously holding leadership positions at Tailored Brands, PetSmart, The Gap and others.

While retail experts praised the move as the best outcome the retailer could have been hoped for, they also cautioned that Big Lots still has work to do.

Andrew Dickow, managing director at Greenwich Capital Group, an investment bank and advisory firm, said that a Big Lots operating with a reduced footprint of 200 to 400 stores presents both challenges and opportunities.

“While a smaller store base limits market reach, it can also lead to more focused and efficient operations,” Dickow noted.

He added that the involvement of Variety Wholesalers, which has experience in the discount retail sector, could provide strategic advantages.

Priorities for Big Lots stores

Dickow said the immediate focus will likely be on stabilizing operations under new ownership and ensuring a smooth transition for the acquired stores and distribution centers. In the long term, he believes the focus should be on reevaluating product offerings and aligning inventory with consumer demand to boost sales. Moreover, Big Lots needs to enhance its online presence, he assessed.

Kaveh Vahdat, founder and president of the marketing agency RiseOpp, said that while this deal helps preserve the company, the stores will still face challenges presented by their smaller footprint.

“This strategy comes with significant risks, including losing national brand recognition and economies of scale,” he stated. “It also raises questions about whether the remaining stores can generate enough revenue to support a viable business model.”

Vahdat sees Big Lots’ downsizing as indicative of the severe challenges facing the discount retail sector broadly.

“The real test will be whether Big Lots can redefine its role in the highly competitive discount market,” he explained. “Without a clear and differentiated value proposition, this move may only delay the inevitable rather than position the brand for recovery. The shift to a smaller footprint is not a guaranteed lifeline but rather a gamble that could either stabilize the business or lead to further decline.”

Do you rank in our databases? 

Submit your data and we’ll see where you fit in our next ranking update.

Sign up

Stay on top of the latest developments in the online retail industry. Sign up for a complimentary subscription to Digital Commerce 360 Retail News. Follow us on LinkedIn, X (formerly Twitter), Facebook and YouTube. Be the first to know when Digital Commerce 360 publishes news content.