When Motel 6 opened in 1962, it cost $6 to rent a room for a night. Thanks to inflation, the cheapest room is now $29.99.
The 99 Cents Only Store (NDN) may be heading for a similar fate. The usual suspects (near record-high oil prices, soaring food costs, fast-rising inflation, etc.) are causing headaches for the 26-year-old chain.
Rather than selling a dozen eggs for $0.99, the story is now selling half-dozens. Rather than selling full milk cartons, they’re selling pints. The company has also just plain stopped stocking some items that are no longer profitable to sell. But the company’s management is seeing the writing on the wall (LA Times):
“There’s no question we’re going to need to do something,” Chief Executive Eric Schiffer said to analysts this month after the company reported its second consecutive quarterly loss. “When you are part of a family that comes up with a concept, sometimes you’re the last to admit that it needs to be changed.”
$1.99 Only Stores here we come.
As Bob Dylan sang, “Times, they are a-changin’.”