If you‘re a bargain hunter, chances are you‘ve found yourself browsing the aisles of a Big Lots store, searching for great deals on a wide variety of products. With over 1,400 locations across 47 states, Big Lots has become one of the most popular discount retailers in the country. But what exactly can you expect to find at Big Lots? Let‘s take a closer look.
Understanding Big Lots‘ Closeout Model
To really understand Big Lots‘ product assortment, it‘s important to first understand their business model. Big Lots is what‘s known as a closeout retailer. This means that instead of purchasing inventory directly from manufacturers like traditional retailers do, they specialize in buying surplus inventory and customer returns from other retailers, often at a steep discount.
As Big Lots‘ CEO Bruce Thorn explained in a recent interview with The Columbus Dispatch, "We‘re buying merchandise that‘s no longer in production, has been discontinued or is at the end of a season." This closeout model allows Big Lots to acquire merchandise at 20-60% below wholesale costs and pass those savings on to consumers.
However, this approach does mean that Big Lots‘ inventory can be somewhat inconsistent. "There might be 10,000 units of an item in 200 stores one week and then the next week, it‘s gone," Thorn noted. So while you never know exactly what treasures you might find at Big Lots, this "treasure hunt" aspect is part of what keeps many shoppers coming back.
Big Lots‘ Product Mix Breakdown
So what kind of products does Big Lots‘ closeout model allow them to offer? The retailer divides its merchandise into six core categories:
| Category | % of 2020 Sales |
|---|---|
| Furniture | 31% |
| Soft Home | 24% |
| Hard Home | 16% |
| Food & Consumables | 15% |
| Seasonal | 11% |
| Electronics, Toys & Accessories | 3% |
Source: Big Lots 2020 Annual Report
As you can see, Furniture and Soft Home goods (which includes items like bedding, bath, and home decor) make up over half of Big Lots‘ sales. This focus on home-related categories is a key differentiator for the retailer. While competitors like Dollar General and Family Dollar derive the majority of their sales from consumables, Big Lots has carved out a niche as a go-to destination for affordable furniture and home decor.
"We believe our furniture financing programs, strong price/value equation, and quick delivery options provide our customers access to high-quality furniture not available at other value retailers," noted Big Lots in their latest annual report. The retailer has even tested stand-alone furniture stores in several markets.
Private Label Brands & Exclusive Products
In addition to closeout merchandise, Big Lots also offers a variety of products under its own private label brands. These exclusive brands span several product categories and include:
- Broyhill (furniture)
- Real Living (furniture)
- Simple Couture (bed & bath)
- Studio Living (home decor)
- The Lot (apparel)
- Fresh Finds (food)
By offering these exclusive brands alongside name-brand closeouts, Big Lots aims to provide a compelling mix of value and quality for shoppers. Private label represented over 30% of Big Lots‘ sales in 2020, up from 25% in 2019, indicating these brands are resonating with consumers.
Big Lots has also formed partnerships to offer exclusive products not available at other retailers. For example, the company recently announced a collaboration with country music star Miranda Lambert to launch a new home goods collection called Wanda June, named for her grandmother.
Driving Foot Traffic with Furniture & Seasonal Goods
Big Lots‘ focus on furniture and seasonal products doesn‘t just boost sales in these categories – it also helps drive overall foot traffic to stores. As retail analyst Jaime Katz explained to Furniture Today, "Furniture is a category that gets consumers into stores, so featuring it prominently can increase overall store traffic."
Seasonal items serve a similar purpose, giving shoppers a reason to visit Big Lots regularly throughout the year to check out the latest holiday decor or outdoor furniture. "Furniture is an important part of our business and really a strategic part of our business because it drives traffic," CEO Bruce Thorn told Yahoo Finance. "A great example of that is our Broyhill brand, which has been one of our top growth brands."
What‘s the Big Appeal?
With so many discount retailers to choose from, what keeps shoppers coming back to Big Lots? For many, it‘s the thrill of finding a really unique item at an unbeatable price. As one Reddit user put it in a thread about favorite Big Lots finds, "I‘ve found some really nice furniture there for dirt cheap. I once got a really nice leather recliner for like $120."
Others appreciate the wide variety of products Big Lots carries, making it possible to check multiple items off your shopping list in a single trip. "From food to furniture, you can pretty much find anything you need at Big Lots," remarked one Google reviewer.
Of course, Big Lots‘ model isn‘t without its drawbacks. The inconsistent inventory can be frustrating for some shoppers, especially if you spot a great item on one trip but can‘t find it again on your next visit. And while prices are generally low, some consumers point out that Big Lots isn‘t always the cheapest option.
"Big Lots used to be the most inexpensive place to shop, but not so much anymore," noted a customer in a Consumer Affairs review. "I was in there recently and saw several items priced higher than Amazon and Walmart."
The Bottom Line
At the end of the day, Big Lots has managed to carve out a unique position in the competitive discount retail landscape by offering a distinct mix of products anchored by furniture and home goods. While the retailer‘s closeout model means you might not always find the same items on every visit, many shoppers enjoy the treasure hunt and the feeling of scoring a great deal.
With strong sales growth in recent years, including a 16.1% increase in same-store sales in fiscal 2020, Big Lots‘ strategy seems to be paying off. As the retailer continues to expand its private label offerings and refine its product mix, it will be interesting to see how it evolves to keep pace with changing consumer preferences. But one thing seems certain: as long as there are bargain hunters out there, Big Lots will have a role to play in helping them stretch their shopping dollars further.
