Published February 11, 2025

Another major discount retailer has filed for bankruptcy. Bargain Hunt, a once-thriving off-price chain, has entered Chapter 11 and is closing all store locations. This follows a wave of retail closures and bankruptcies in the discount space – Big Lots, 99 Cents Only, Channel Control Merchants (Dirt Cheap, and Treasure Hunt) have either filed for bankruptcy or shut down entirely.

With so many closures happening at once, the big question on the minds of CPG brands is:

“Is discount retail still worth partnering with for my excess inventory?”

Let’s be clear: Yes, it absolutely is.

Despite market shakeups, discount retail remains a critical channel for moving excess inventory. Consumer demand for value-driven shopping is stronger than ever—it’s just the retail landscape that’s shifting.

Here’s what CPG brands need to know about Bargain Hunt’s bankruptcy and what it signals about the future of discount retail.

1. Discount Retail Is Changing—Not Disappearing

The consumer appetite for deals and value-driven shopping is still at an all-time high, fueled by inflation and shifting spending habits. However, what consumers are buying has changed. Big-ticket discretionary purchases, like furniture, are taking a backseat, while demand remains strong for essentials and affordable discretionary categories like consumables. Shoppers are prioritizing products that provide immediate value, stretching their dollars on everyday necessities and small indulgences rather than large, non-essential purchases.

What’s changing? The mix of who’s winning and who’s struggling in the space. Some retailers are thriving by adapting to this shift by ensuring their merchandising strategy aligns with consumer preferences, maintaining strong supplier relationships, and managing costs effectively. Others, like Bargain Hunt, have faced operational and financial challenges that led to restructuring, with many struggling to adjust their inventory mix quickly enough to keep up with evolving consumer demand.

2. The Discount Shake-Up Is Part of a Bigger Retail Trend

Retail closures aren’t just hitting the discount sector. Across categories, brands are reassessing their strategies as foot traffic declines and e-commerce competition increases.

  • More stores are closing than opening—Forbes predicts twice as many store closures as openings in 2025.
  • Department stores and specialty retailers are downsizing or becoming obsolete, including big names like Party City and Walgreens.
  • Economic pressures and shifting consumer habits are forcing retailers to rethink their models.

For CPG brands, this means a more proactive approach to inventory management is critical—waiting until the last minute to offload excess inventory is no longer a viable strategy.

3. Why Some Retailers Struggle While Others Thrive

Some discount retailers failed to adapt, while others are finding success by sticking to core principles and evolving their models.

Retailers that struggle:

  • Rely too heavily on outdated models and don’t adjust to shifting consumer demands.
  • Face liquidity issues, debt burdens, or operational inefficiencies.
  • Lose supplier trust by failing to execute strong buy-and-sell strategies.‍


‍Retailers That are Thriving:

  • Ollie’s Bargain Outlet – Has successfully stuck to its core model of opportunistic buying and keeping financials healthy. Read more about Ollie’s success HERE.
  • TJX (TJ Maxx, Marshalls, HomeGoods) – Continues to dominate by maintaining strong supplier relationships and an agile off price buying model.
  • Ross Stores – Has successfully balanced cost control and opportunistic purchasing to stay ahead.
    ‍

The key takeaway? Retail is evolving, and traditional purchasing and merchandising practices are no longer a guarantee.

4. The Risks of Relying on a Limited Buyer Network

Bargain Hunt’s bankruptcy highlights an important lesson for CPG brands: depending on just one or a few discount retail partners can create vulnerabilities. When a key buyer struggles, brands with limited alternatives may face sudden disruptions in their inventory strategy.

To build a more resilient approach, brands can:

  • Diversify their buyer network – Expanding retail and wholesale partnerships reduces dependency on a single outlet and spreads risk.
  • Take a proactive approach to inventory management – Delaying liquidation can lead to lower margins and missed opportunities with reputable buyers who need products with sufficient shelf life.
  • Optimize sales channels – Selling through a competitive mix of retailers and wholesalers helps maximize returns and avoid last-minute, deeply discounted sales.

A well-balanced inventory strategy ensures stability even in a shifting retail landscape.

5. Discount Retail Still Plays a Critical Role for CPGs

Even with recent bankruptcies, discount retailers continue to be a vital channel for moving excess inventory. The key is choosing the right partners and selling strategically.

Brands that take control of their excess inventory strategy will:

  • Maximize recoveries instead of taking deep markdowns.
  • Protect brand reputation by selling through the right channels.
  • Avoid margin erosion by making informed, data-driven sales decisions.
    ‍

6. The Best Approach? Proactive, Controlled Inventory Management

The days of reactive, last-minute liquidation are over. Successful brands are shifting to a proactive, structured approach to inventory management, which includes:

  • Expanding beyond just one or two buyers.
  • Prioritizing financially sound, reliable retail and wholesale partners.
    ‍

This is where Spoiler Alert can help. We support CPG brands in taking control of their excess inventory strategy by connecting them with diverse, qualified buyers. This ensures smarter, more profitable inventory management and ultimately recouping more revenue.

Key Takeaways for Navigating the Discount Retail Shake-Up: Key Strategies for CPG Success
‍

  • Diversification and Strong Partnerships Are Key to Success – Relying on just one or two discount retail buyers poses significant risks. Brands that build relationships with financially stable, reliable partners and diversify their buyer network will be better positioned to navigate market shifts.
  • Discount Retail Is Evolving, Not Disappearing – Despite recent bankruptcies, consumer demand for value-driven shopping remains high. The key difference is that successful discount retailers are adapting to changing consumer preferences, while those that fail to evolve are struggling.
  • A Proactive Inventory Strategy Is More Important Than Ever – Retail closures across various sectors signal a broader industry shift. CPG brands must take a strategic, proactive approach to excess inventory management rather than relying on last-minute liquidation.
    ‍

Want to discuss how to navigate this evolving landscape? Let’s talk.

‍