Big Lots ceo sees 1,800 stores
Staff Staff -- Home Textiles Today, June 11, 2008
New York – Closeout retailer Big Lots, now operating more than 1,350 stores in 47 states, could reach 1,800 stores, said chairman and ceo Steve Fishman, speaking at the Piper Jaffray Consumer Conference here today.
Fishman for more than a year has focused the $4.7 billion retailer on operational issues, while putting real estate expansion on hold. Now – with SG&A costs trending down toward the lowest level in company history – he is indicating a sharp new interest, especially as the real estate market is growing more advantageous. He told analysts, “The rent market needed to cool down before we were going to be able to open a significant number of stores profitably.”
“We believe we are in the perfect position to capitalize on real estate opportunities,” said Fishman. “We’ve streamlined our business – and are ready to grow. We’re highly motivated to open more stores at the right price.”
Fishman said the current Big Lots distribution infrastructure can support one-third more stores. He emphasized that better management of distribution centers and transport has helped push down overhead costs.
At Big Lots, SG&A as a percentage of sales has dropped from 38.5% in 2005 to 34.7% in 2007, and is projected at 34.4% this year.
With a record year under its belt in 2007 and a good start with a 75% upswing in quarterly profit for 1Q 08, Big Lots may be poised for growth, and home can be part of that. Home textiles and home décor combine for 15% of volume at Big Lots – and furniture is another 15%. In home, dedicated agents overseas are the key resource, Fishman noted.
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