Very few retail chains build a following so devoted that every new store opening counts as an event.
In fact, it’s hard to think of any non-fast-food chains where fans line up ahead of the opening, making it a massive event. Chick-fil-A and maybe In-N-Out Burger have managed to pull this off, but it’s something you very rarely see.
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Ollie’s Bargain Outlet might have the most devoted fanbase in all of retail. The chain has even named its fans, calling them “Ollie’s Army,” and they’re superfans who travel to new stores to make sure that the opening draws a crowd.
Retailers literally can’t buy this kind of publicity. Yes, you can pay to advertise a new store opening, but that does not create the level of enthusiasm that Ollie’s (OLLI) Army brings.
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Unlike many retailers, Ollie’s has expanded very slowly. The chain takes a very measured approach to expansion, making sure it only enters markets where it can meet customer needs.
That makes it very special that the retail chain has taken steps to add 40 stores in an unconventional way.
Image source: Hanna Lassen/Getty Images
Closed Big Lots locations won’t stay closed
Because the overall number of retail stores has been shrinking nationwide, many vacant locations sit for months or even years before a new tenant takes over. That’s because retailers have some leverage over landlords given the number of chains that have gone out of business.
When a retailer (or any other brick-and-mortar business) files for Chapter 11 bankruptcy protection, its leases are an asset that could be auctioned off. In some cases, a landlord will terminate the lease, but that generally only happens if the building owner believes it could re-rent the location at a higher price.
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In many cases, some portion of a chain’s lease will be picked up by a rival. It’s very rare, however, that those locations will reopen under another brand not long after their going-out-of-business sale.
That, however, is what’s happening for select Big Lots locations. It will take some time to make the transformation, but work will begin at closing and closed locations, keeping them from being shut down for very long.
Ollie’s taking over shuttered retail locations
While 200-400 Big Lots locations will reopen using the Big Lots name under new ownership, Ollie’s will take over 60 locations from the discount retailer but transform them into Ollie’s Bargain Outlets.
Ollie’s plans to purchase 40 additional former Big Lots store leases from the company in Chapter 11 bankruptcy. The acquisition of the additional store leases is subject to final bankruptcy court approval and customary closing conditions. Including the 40 additional Big Lots locations, the Company has acquired a total of 63 former Big Lots store leases to date.
“Similar to what we have done with previous store acquisitions over the past year, we will adjust our existing new store openings and prioritize the opening of the acquired stores in a manner that makes the most operational and financial sense,” Ollie’s CEO Eric van der Valk shared,.
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The discount chain currently operates 568 stores in 31 states
This acquisition, along with the investments we have made to position the company for sustainable long-term growth, provides us with the opportunity to accelerate new store openings in 2025 above our 10% annual growth target and open approximately 75 units,” the CEO added.
