Type Private Revenue $1.30 billion (2009) Net income $8.48 million (2009) Founder Dave Gold Number of employees 11,500 | Key people Geoff Covert CEO, Operating income Number of locations 394 Founded 1982 | |
Industry Discount, variety store Headquarters Commerce, California, United States CEO Geoffrey J. Covert (11 Sep 2015–) Owners Ares Management, CPP Investment Board Profiles | ||
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99 Cents Only Stores is an American price-point retailer chain based in Commerce, California. Previously, the store offered all products at 99¢ or less. Most products are now priced at "99.99¢ or less, but certain products are sold at higher price points". Founded by David Gold on February 28, 1969, most of the stores are located in Southern California, with others in Nevada, Texas and Arizona. The company also operates Bargain Wholesale, which sells wholesale to retailers across the United States and exports to more than 15 countries from showrooms in Los Angeles. It also exhibits at trade shows in Las Vegas and Chicago.
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1980s
Gold first came up with the idea as a means to liquidate slow selling wines at his liquor store. "Whenever I'd put wine or cheese on sale for $1.02 or 98 cents, it never sold out," Gold said in 2001 interview with The Los Angeles Times. "When I put a 99 cent sign on anything, it was gone in no time. I realized it was a magic number."
After prompting from a friend, he then created a full store of these bargains. To get publicity, he sold televisions for only 99 cents on the first day, then had family members calling TV stations to ask about the commotion caused by the lines. The practice continues today as a brand new 99 Cents Only Store will sell a high priced item for 99 cents to the first nine customers in line on opening day, and other limited prices for the next 90 new opening day customers. Despite its image, the company operates a basic information technology operation with a computer system ordering stockers in the distribution center and point of sale registers tracking purchases at every store. The Texas distribution center is a former Albertsons facility bought when that company exited the Houston market.
2000s
In November 2003, a more flexible pricing structure was implemented where items are sold for prices lower than 99 cents (for example, 69 or 49 cents). The management believes that this will permit better management of commodity price increases.
In September 2007, the company raised its highest price from 99 cents to 99.99 cents; the first increase in the history of the franchise—to combat "dramatically rising costs and inflation." However now the store carries select items that are over the .99 price point; such as $1.99 and $2.99.)
Despite having announced on September 18, 2008, that the company would close all stores in Texas, in February 2009, the company decided that it will close only one-third of its Texas stores. The company quoted a rise in sales, and plans to keep the stores open, as long as the stores remain profitable.
2010s
In October 2011, the company agreed to a $1.6 billion buy-out by private equity firm Ares Management and the CPP Investment Board. The deal was completed on January 13, 2012. New ownership decided to lay off 172 plus employees, October 2013. The Gold family ended their involvement with the company in January 2013.
Popular culture
99 Cents Only Stores advertises that it is open "9 days a week," often invoking humorous commentary on holidays with products sold for 99 cents. One advertisement wished Joan Rivers "Happy 99th Facelift"; another congratulated the Los Angeles "Dodgers on Losing 99 Games." The company also celebrates the 99th birthday of public figures and names 99-year-old individuals as honorary spokespersons.
Photographer Andreas Gursky's diptych of the inside of the Hollywood, California 99 Cents Only store became - at the time - the most expensive photograph ever sold in February 2007, auctioned for $3.3 million.