Big Lots Faces Store Portfolio Erosion as Rivals Acquire Key Locations

The ongoing restructuring of Big Lots has taken a concrete turn, with competitor Ollie's Bargain Outlet confirming the acquisition of 63 former Big Lots store leases. This move highlights a significant contraction of Big Lots' independent footprint, as rivals swiftly move to occupy its former retail spaces. The development raises critical questions about whether the company's remaining core operations can form a viable foundation for a future restart.

Recent quarterly results from Ollie's provide clear insight into the strategic value of these locations. The company reported opening 32 rebranded stores last quarter, directly attributing its physical growth to these acquisitions. Ollie's financial performance further illustrates the opportunity, with revenue climbing 18.6% to $613.6 million. These figures underscore the economic potential of the sites Big Lots relinquished during its Chapter 11 proceedings. The transfer of these leases is permanent, resulting in a sustained reduction of Big Lots' operational reach.

Parallel Paths Emerge in Asset Division

The current situation reveals two distinct trajectories for Big Lots' former assets. On one path, competitors like Ollie's are rebranding prime retail leases and integrating them into their own networks. Simultaneously, Variety Wholesalers has outlined plans to operate between 200 and 400 locations under the "Big Lots" banner. This creates a bifurcated outcome: a liquidation segment where valuable real estate is absorbed by competitors, and a continuing operations segment attempting to stabilize under new ownership. For investors holding the over-the-counter shares (ticker: BIGGQ), this structure indicates that tangible value is primarily being transferred to creditors and buyers, rather than to public shareholders.

Should investors sell immediately? Or is it worth buying Big Lots?

Key Data Points:
* Ollie's Bargain Outlet has taken over 63 former Big Lots stores.
* 32 of these locations were reopened under the Ollie's brand last quarter.
* Ollie's quarterly revenue reached $613.6 million, an increase of 18.6%.
* Variety Wholesalers intends to run 200–400 stores using the Big Lots name.
* Big Lots' original store fleet numbered approximately 869 locations.

Future Hinges on Execution of Remaining Stores

The road ahead for what remains of Big Lots depends heavily on two factors. First, the speed and completeness with which the company's remaining inventory and assets are either sold off or transferred to the continuing business. Second, and more crucially, whether the 200–400 stores targeted by Variety Wholesalers can, by 2026, generate sufficient revenue to compensate for a meaningful portion of the original 869-store portfolio.

If Variety Wholesalers succeeds in stabilizing operations, a smaller, continuing Big Lots core could emerge. Should this effort falter, further lease acquisitions by competitors appear likely. This possibility is underscored by Ollie's own expanded long-term target of operating 1,300 stores nationwide.