Community helps 99 Cents Only employees; city reviews Sprouts plans

While people in the western U.S. were waiting for the solar eclipse Monday, employees at the 99 Cents Only store at 2080 E. William St., in Carson City were facing another kind of darkness: looming unemployment.

One employee talked to the Appeal about the abrupt announcement Thursday stating the company would be shuttering 371 stores in four states and liquidating merchandise. The Carson store is slated to close June 3 unless everything is sold before then, said the employee who did not want to be publicly identified. The store’s 20-plus employees would not be receiving any kind of severance pay after years of working at the location, the employee said.

“I don’t even know what to say. It’s been a smack in the face,” they said.

Thursday, the company’s interim CEO — said to be stepping down — blamed challenges in retail “including the unprecedented impact of the COVID-19 pandemic, shifting consumer demand, rising levels of shrink, persistent inflationary pressures and other macroeconomic headwinds, all of which have greatly hindered the company’s ability to operate.”

“We deeply appreciate the dedicated employees, customers, partners, and communities who have collectively supported 99 Cents Only Stores for decades,” said Mike Simoncic, interim CEO.

The employee who spoke to the Appeal wasn’t sure what to make of the interim CEO’s statements, saying the Carson store had been in business for more than a decade with plenty of customers. They said the rest of the employees at the store were heartbroken.

Monday, 99 Cents Only announced it filed for relief under Chapter 11 of U.S. bankruptcy code to pursue “a value maximizing sale of its real estate and other assets.”

“The company has secured $60.8 million in senior secured super priority debtor-in-possession financing consisting of $35.5 million in new money to be provided by an entity affiliated with certain of the company's existing stakeholders, subject to court approval, to facilitate the wind-down and pursue a value maximizing sale of its real estate and other assets,” read a news release. “The company has filed customary motions with the court to support its operations through the wind-down process, including payment of employee wages.”

Other businesses in the community didn’t wait to help those in the lurch. Some of the employees facing the June 3 shutdown were already interviewing at nearby Grocery Outlet, a store that stepped up, the 99 Cents Only employee said.

Furthermore, Carson-based Stellar Snack sent a note to the Appeal saying Stellar was actively hiring for several full-time positions with benefits and was hopeful some of the affected employees would apply. Job listings for Stellar Snacks can be found online: https://stellarsnacks.com/pages/careers.

News of 99 Cents Only closing occurred within a week of Burlington Coat Factory in south Carson confirming it would close April 19. Burlington had roughly the same number of employees as 99 Cents Only, but its employees were offered a severance package or the option of transferring to another store in the area, a spokesperson told the Appeal on April 1.

Monday, Ronni Hannaman, executive director of the Carson City Chamber of Commerce, tried to make sense of the mixed bag of business news. She discussed new businesses investing in the community, such as plans for a Sprouts market and Planet Fitness in north Carson. The city’s Community Development Department is reviewing permits for a 45,465-square-foot building at 3335 Market St., though a construction timeline is unknown at this time.

“This is the same thing that happened in 2008,” said Hannaman, recalling a period of economic recession. “Quite a number of stores closed, while quite a number came in. The difference between then and now is when businesses closed then, there were no places for people to go. Right now, the market is such that businesses are absorbing trained personnel.”

Hannaman added: “What I hate to see is another vacant store, but I don’t think they will be vacant for long.”