California-based 99 Cents Only Stores is closing down, citing COVID, inflation and product theft

SAN FRANCISCO– California-based 99 Cents Only Stores said Friday it will close all 371 of its stores, ending the chain’s 42-year run selling an assortment of bargain items.

The company has stores in California, Arizona, Nevada and Texas that will sell their merchandise, as well as fixtures, furniture and equipment.

Interim CEO Mike Simoncic said in a statement that the retailer has been struggling for years due to the COVID-19 pandemic, changes in consumer demand, inflation and rising levels of “product shrinkage” – a measure that includes losses due to employee theft and includes shoplifting. , damage, administrative errors and more.

“This was an extremely difficult decision and it is not the outcome we expected or hoped to achieve,” said Simoncic, who will resign. “Unfortunately, recent years have brought significant and ongoing challenges to the retail environment.”

The closure of 99 Cents Only Stores comes after fellow discount retailer Dollar Tree said last month it would close 1,000 stores.

99 Cents Only Stores was founded in 1982 by Dave Gold, who opened his first store in Los Angeles at age 50, according to his 2013 obituary in the Los Angeles Times. Gold, who had worked at a liquor store owned by his father, found that marking down surplus items to 99 cents caused them to sell out “in no time,” fueling his desire to put a new spin on the dollar store.

“I realized it was a magic number,” he told the Times. “I thought, wouldn’t it be nice to have a store where everything was good quality and everything cost 99 cents?”

Shaking off doubting friends and family members, Gold continued. His idea quickly caught on, even in middle-class and upscale neighborhoods, allowing the company to go public on the New York Stock Exchange in 1996. It was later sold for around $1.6 billion in 2011.

Gold became a multi-millionaire, but lived modestly. His family told the Times that he had lived with his wife in the same middle-class home for nearly 50 years and drove the same Toyota Prius he bought in 2000.

While the chain initially sold most items for 99 cents, that became unsustainable in recent decades, although the company retained its trademarked name.