A Retail Giant Falls: Bargain Hunt Declares Bankruptcy

Bargain Hunt, the well-known discount retailer, has officially filed for Chapter 11 bankruptcy as of February 3, marking the end of its operations across ten Midwestern and Southeastern states. The parent company, Essex Technology Group, cited multiple challenges—including stiff competition from big-box stores and convenience chains, rising inflation, and supply chain disruptions—as the primary reasons behind its financial downfall.

With going-out-of-business sales already underway at all 92 locations, the retailer is winding down operations after suffering two consecutive years of losses and heading toward a third. According to court filings, Bargain Hunt reported a net loss of approximately $19 million on sales of $274 million in the ten months leading up to November 30, 2023.

 

Mounting Debts and Major Creditors

The financial struggles of Bargain Hunt are significant, with reported liabilities ranging between $50 million and $100 million, while assets range from $10 million to $50 million. Among its top creditors are retail giants like Amazon and Target, as well as hardware retailer True Value and supply chain company Averitt. These creditors collectively hold about $35.6 million in unsecured claims, further highlighting the depth of the company's financial troubles.

 

The Bigger Picture: Another Retail Casualty

Bargain Hunt is the latest in a growing list of retailers unable to withstand the pressures of a shifting consumer landscape. It follows in the footsteps of other discount retailers, including Big Lots, which is continuing under new ownership with a significantly reduced store footprint.

Despite efforts to explore a sale and sustain operations, Bargain Hunt’s leadership saw no viable path forward. Chief Restructuring Officer Rob Hubbard confirmed that, with no immediate buyers in sight, liquidation through retail store sales remained the only option to maximize value. As a result, all stores are expected to close by the end of February.

Hilco Consumer-Retail and Gordon Brothers are managing the liquidation process, with gift cards being accepted only until Wednesday. Additionally, returns for purchases made before January 30 will be honored until the same deadline. Store fixtures and equipment are also available for sale as part of the closure proceedings.

 

The Amazon Connection: A Costly Fallout

While Bargain Hunt was primarily known for its discount retail stores, it also operated a profitable reverse logistics segment, reselling returned goods from major suppliers. Amazon played a crucial role in this operation, serving as the company’s largest supplier. However, in a devastating blow, Bargain Hunt lost 25%—and eventually all—of its business with Amazon last year as the e-commerce giant reevaluated its partnerships in the reverse logistics space.

Without Amazon’s support, Bargain Hunt struggled to meet its payment obligations, leading to a full termination of their business relationship. The loss of this revenue stream proved fatal, with Amazon now listed as the company’s top creditor, owed more than $29 million.

 

Bargain Hunt's Final Days

The Tennessee-based company, which employed 1,650 people as of February 3, had built a reputation for offering deeply discounted merchandise across a variety of categories, including apparel, home decor, furniture, toys, electronics, food, and seasonal items. It operated stores in Alabama, Arkansas, Georgia, Indiana, Kentucky, Mississippi, North Carolina, Ohio, South Carolina, and Tennessee.

As the retailer prepares to shut its doors permanently, shoppers looking for last-minute bargains will find deep discounts on remaining inventory. But for the company and its employees, this marks the end of an era in the world of discount retailing—a sobering reminder of the evolving challenges facing brick-and-mortar stores in an increasingly competitive market.