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Why Discount Retailers are Adding New Stores

Big Lots Reports Record Comp-Store Sales Growth
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Exceptional value. Amazing products. An exhilarating experience.

Who wouldn’t want a piece of this business?

It turns out that it’s not just what a lot of shoppers want, but the three core reasons why the Columbus-based discount retailer Big Lots says it’s on a mission to expand its unique “emotionally connected” brand to a shopper base of 75% women.

Announcing its updated forecast and long-term growth plan to analysts and investors this week, the 50-year-old chain bucked the industry’s trend toward going digital. Instead, the retailer said it would reverse a decade of stagnant growth in the number of stores with new plans to add 500 more locations and boost sales.

But this begs the question: How can big contracts—plus competing discounters and dollar stores—continually challenge the downsizing and retail reorientation shift that has seen so many others move away from physical stores?

“Easy,” says Karen Webster of PYMNTS. “Because people want to shop for fun and entertainment,” she added, noting the joy of finding and getting something you don’t really need and then telling your friends about it.

Turns out, that “magic moment” never gets old.

In fact, in Big Lots’ own words, much of the appeal that reducers have is based on the fact that “the value never runs out.”

Beyond the Big Three

As it stands, Dollar General, Dollar Tree, and Family Dollar only accounted for nearly half of all new store openings in the United States last year, as they changed new formats, store layouts and delivery and added more product categories, particularly food and produce. production, to keep consumers buying – and happy.

Not only is this having an impact in the worn-out world of impulse buying, but as their influence is increasing, especially in rural communities, there is a major comfort factor too that plays in their success and growth.

In short, driving to a discount store in your city, finding a parking space a few yards from the entrance, then being able to quickly get in and out of a store one-tenth the size of a warehouse retailer is a whole different proposition.

“We see a clear, long-term growth path ahead, paired with the opportunity to generate returns through margin expansion and prudent capital allocation,” Big Lots CEO Bruce Thorne said in a statement outlining the retailer’s growth plans.

With over 80% of its sales derived from furniture (30%), food and consumables (26%) and hard and soft household goods (26%), seasonal stock and apparel, Big Lots owns many products indicate to attract the attention of its unique and loyal customers. .

According to the company’s demographic data, the typical Big Lots buyer is a woman who is 40 or older who lives for home and family, loves hosting, entertainment, in-store and online shopping and – most importantly – enjoys hunting for treasures and deals. “

And here it is, the secret sauce fueling growth in this quirky little corner of discounted, fun-branded retail.

The experience turned out to be very important.

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