What changed in this filing

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Item 1. Business

2023-03-24 compared with 2022-03-25 · 750 added, 838 removed, 358 unchanged (82% of the section changed)

Ollie’s is a highly differentiated and fast-growing, extreme value retailer of brand name merchandise at drastically reduced prices.

Known for our assortment of “Good Stuff Cheap,” we offer

customers a broad selection of brand name products, including housewares, bed and bath, food, floor coverings, health and beauty aids, books and stationery, toys and electronics.

Known for our assortment of products offered as “Good Stuff Cheap,”

we offer customers a broad selection of brand name products, including housewares, bed and bath, food, floor coverings, health and beauty aids, books and stationery, toys and electronics.

Our differentiated go-to market strategy is characterized by a

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These attributes have driven our rapid growth and strong and consistent store

Ollie’s was founded based on the idea that “everyone in America loves a bargain.” Since opening our first store in Mechanicsburg, PA in 1982, we have grown organically by backfilling existing

markets and leveraging our brand awareness, marketing and infrastructure to expand into new markets in contiguous states.

Ollie’s was founded based on the idea that “everyone in America loves a bargain.” Since opening our first store in Mechanicsburg, PA in 1982, we have grown organically by backfilling existing markets

and leveraging our brand awareness, marketing, and infrastructure to expand into new markets in contiguous states.

We have grown to 468 stores in 29 states as of January 28, 2023.

5 unchanged sentences

Hoffman Strategy Group, a retail real estate feasibility consultant that provides market analysis and strategic planning and consulting services.

Our constantly changing merchandise assortment is procured by a highly experienced merchant team, who leverage deep, long-standing relationships with hundreds of major manufacturers,

wholesalers, distributors, brokers and retailers.

These relationships enable our merchant team to find and select only the best buys from a broad range of brand name and closeout product offerings and to pass drastically reduced prices along to

our customers.

As we grow, we believe our increased scale has provided and will continue to provide us with even greater access to brand name products as many large manufacturers favor large buyers capable of acquiring an entire deal.

merchant team augments these deals with directly sourced products, including Ollie’s own private label brands and other products exclusive to Ollie’s.

Our constantly changing merchandise assortment is procured by a highly experienced merchant team, who leverage deep, long-standing relationships with hundreds of major manufacturers, wholesalers,

distributors, brokers and retailers.

These relationships enable our merchant team to find and select only the best buys from a broad range of brand name and closeout product offerings and to pass drastically reduced prices along to our customers.

we grow, we believe our increased scale has provided and will continue to provide us with even greater access to brand name products as many large manufacturers favor large buyers capable of acquiring an entire deal.

Our merchant team augments these

deals with directly sourced products, including Ollie’s own private label brands and other products exclusive to Ollie’s.

Our business model has produced consistently strong growth and financial performance.

From 2018 through 2022:

Our store base expanded from 268 stores to 431 stores, a compound annual growth rate, or CAGR, of 12.6% and we entered nine new states;

Our store base expanded from 303 stores to 468 stores, a compound annual growth rate, or CAGR, of 11.5% and we entered six new states;

Comparable store sales grew at an average rate of 1.0% per year;

Net sales increased from $1.241 billion to $1.827 billion, a CAGR of 10.2%.

Net income increased from $127.6 million to $157.5 million.

Our competitive strengths

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“ Good Stuff Cheap”—Ever changing product assortment at drastically reduced prices .

Our stores offer something for everyone across

a diverse range of merchandise categories at prices up to 70% below department and fancy stores and up to 20-50% below mass market retailers.

Our product assortment frequently changes based on the wide variety of deals available from the hundreds

of brand name suppliers we have relationships with.

We augment these opportunistic deals on brand name merchandise with directly-sourced unbranded products or those under our own private label brands and exclusively licensed recognizable brands

and celebrity names.

Our stores offer something for everyone across a diverse

range of merchandise categories at prices up to 70% below department and fancy stores and up to 20-50% below mass market retailers.

Our product assortment frequently changes based on the wide variety of deals available from the hundreds of brand name

suppliers we have relationships with.

We augment these opportunistic deals on brand name merchandise with directly-sourced unbranded products or those under our own private label brands and exclusively licensed recognizable brands and celebrity

Brand name and closeout merchandise represented approximately 65% and non-closeout goods and private label products collectively represented approximately 35% of the retail value of our 2022 merchandise purchases.

percentage of non-closeout goods and private label products is higher than our historical average, reflecting higher average unit retail pricing of non-closeout direct import purchases driven by higher freight costs due to global supply chain

Our treasure hunt shopping environment and slogan “when it’s gone, it’s gone” help to instill a “shop now” sense of urgency that encourages frequent customer visits.

Our treasure hunt shopping

environment and slogan “when it’s gone, it’s gone” help to instill a “shop now” sense of urgency that encourages frequent customer visits.

Highly experienced and disciplined merchant team .

Our 22-member merchant team maintains strong, long-standing relationships with a diverse group of suppliers, allowing us to procure branded merchandise at compelling values for our customers.

been doing business with our top 15 suppliers for an average of 17 years, and no supplier accounted for more than 5% of our purchases during 2021.

Our well-established relationships with our suppliers, together with our scale, buying power,

financial credibility and responsiveness, often make Ollie’s the first call for available deals.

Our direct relationships with our suppliers have increased as we have grown and we continuously strive to broaden our supplier network.

factors provide us with increased access to goods, which enable us to be more selective in our deal-making and, we believe, help us provide compelling value and assortment of goods to our customers and fuel our continued profitable growth.

Our merchant team maintains strong, long-standing relationships with a diverse group of

suppliers, allowing us to procure branded merchandise at compelling values for our customers.

We have been doing business with our top 15 suppliers for an average of over 15 years.

Our well-established relationships with our suppliers, together with

our scale, buying power, financial credibility and responsiveness, often make Ollie’s the first call for available deals.

Our direct relationships with our suppliers have increased as we have grown and we continuously strive to broaden our supplier

These factors provide us with increased access to goods, which enable us to be more selective in our deal-making and, we believe, help us provide compelling value and assortment of goods to our customers and fuel our continued profitable

Distinctive brand and engaging shopping experience .

Our distinctive and often self-deprecating humor and highly recognizable caricatures are used in our stores, flyers, mailers, website and email campaigns.

We attempt to make our customers laugh as we

poke fun at ourselves and current events.

We believe this approach creates a strong connection to our brand and sets us apart from other, more traditional retailers.

Our “semi-lovely” stores feature these same brand attributes together with

witty signage in a warehouse format that creates a fun, relaxed and engaging shopping environment.

We believe that by disarming our customers by getting them to giggle a bit, they are more likely to look at and trust our products for what they

are—extremely great bargains.

We offer a “30-day no hard time guarantee” as a means to overcome any skepticism associated with our cheap prices and to build trust and loyalty, because if our customers are not happy, we are not happy.

customers to bring back their merchandise within that timeframe for a “no hard time” full refund.

We also make it easy for our customers to browse our stores by displaying our products on easily accessible fixtures and by keeping the stores

clean and well-lit.

We believe our humorous brand image, compelling values and welcoming stores resonate with our customers and define Ollie’s as a unique and comfortable destination shopping location.

Our distinctive and often self-deprecating humor and highly recognizable caricatures

are used in our stores, flyers, mailers, website and email campaigns.

We attempt to make our customers laugh as we poke fun at ourselves and current events.

We believe this approach creates a strong connection to our brand and sets us apart from

other, more traditional retailers.

Our “semi-lovely” stores feature these same brand attributes together with witty signage in a warehouse format that creates a fun, relaxed and engaging shopping environment.

We believe that by disarming our

customers by getting them to giggle a bit, they are more likely to look at and trust our products for what they are—extremely great bargains.

We offer a “30-day no hard time guarantee” as a means to overcome any skepticism associated with our cheap

prices and to build trust and loyalty, because if our customers are not happy, we are not happy.

We welcome customers to bring back their merchandise within that timeframe for a “no hard time” full refund.

We also make it easy for our customers to

browse our stores by displaying our products on easily accessible fixtures and by keeping the stores clean and well-lit.

We believe our humorous brand image, compelling values and welcoming stores resonate with our customers and define Ollie’s as a

unique and comfortable destination shopping location.

Extremely loyal “Ollie’s Army” customer base.

Our best customers are members of our Ollie’s Army customer loyalty program, which

stands at 12.6 million members as of January 29, 2022.

Our best customers are members of our Ollie’s Army customer loyalty program, which stands at

13.2 million members as of January 28, 2023.

For 2022, over 80% of our sales were from Ollie’s Army members, and we grew our base of loyal members by 4.8% in 2022.

Ollie’s Army members spend approximately 40% more per shopping trip at

Ollie’s than non-members.

Ollie’s Army members spend approximately 40% more per shopping trip at Ollie’s than

We identify our target customer as “anyone age 25 or older with a wallet or a purse” seeking a great bargain.

Strong and consistent store model built for growth.

We employ a proven new store model that generates strong cash flow, consistent financial results and attractive returns on investment.

Our highly flexible real estate approach has proven successful

across all vintages, geographic regions, population densities, demographic groups, real estate formats and regardless of any co-tenant.

New stores opened from 2016 to 2020 have generated an average of $4.7 million in net sales in their first 12

months of operations and produced an average payback period of approximately two years.

We believe that our consistent store performance, strategically-located distribution centers and disciplined approach to site selection support the

portability and predictability of our new unit growth strategy.

We employ a proven new store model that generates strong cash flow, consistent

financial results and attractive returns on investment.

Our highly flexible real estate approach has proven successful across all vintages, geographic regions, population densities, demographic groups, real estate formats and regardless of any

New stores opened from 2017 to 2021 have generated an average of $4.6 million in net sales in their first 12 months of operations and produced an average payback period of approximately two years.

We believe that our consistent store

performance, strategically-located distribution centers, and disciplined approach to site selection support the portability and predictability of our new unit growth strategy.

Highly experienced and passionate management team .

Our leadership team has guided our organization through its expansion and positioned us for continued growth.

Our leadership team has guided our organization through its expansion and positioned us

for continued growth.

We have assembled a talented and dedicated team of executives.

Our senior executives

possess extensive experience across a broad range of disciplines, including merchandising, marketing, real estate, finance, store operations, supply chain management and information technology.

We believe by encouraging equity ownership and

fostering a strong team culture, we have aligned the interests of our executives with those of our stockholders.

We believe these factors result in a cohesive team focused on sustainable long-term growth.

Our senior executives possess extensive experience across a broad range of disciplines, including merchandising, marketing, real estate, finance, store operations,

supply chain management, and information technology.

We believe by encouraging equity ownership and fostering a strong team culture, we have aligned the interests of our executives with those of our stockholders.

We believe these factors result in a

cohesive team focused on sustainable long-term growth.

Our growth strategy

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Grow our store base.

We believe our compelling value proposition and the success of our stores across a broad range of geographic regions, population densities and demographic groups create a significant opportunity to profitably increase our store

Our internal estimates and third-party research conducted by Hoffman Strategy Group indicate the potential for more than 1,050 national locations.

Our new store real estate model is flexible and focuses predominately on second generation

sites ranging in size from 25,000 to 35,000 square feet.

We believe there is an ample supply of suitable low-cost, second generation real estate to allow us to infill within our existing markets as well as to expand into new, contiguous

This approach leverages our distribution infrastructure, field management team, store management, marketing investments and brand awareness.

We expect our new store openings to be the primary driver of our continued, consistent

growth in sales and profitability.

We believe our compelling value proposition and the success of our stores across a broad range of geographic regions,

population densities and demographic groups create a significant opportunity to profitably increase our store count.

Our internal estimates and third-party research conducted by Hoffman Strategy Group indicate the potential for more than 1,050

national locations.

Our new store real estate model is flexible and focuses predominately on second generation sites ranging in size from 25,000 to 35,000 square feet.

We believe there is an ample supply of suitable low-cost, second generation real

estate to allow us to infill within our existing markets as well as to expand into new, contiguous geographies.

This approach leverages our distribution infrastructure, field management team, store management, marketing investments and brand

We expect our new store openings to be the primary driver of our continued, consistent growth in sales and profitability.

Increase our offerings of great bargains.

We will continue to enhance our supplier relationships and develop additional sources to acquire brand name and closeout products for our customers.

Our direct buying relationships with many major

manufacturers, wholesalers, distributors, brokers and retailers provide us with significant opportunities to expand our ever-changing assortment of brand name and closeout merchandise at extreme values.

As we continue to grow, we believe our

increased scale will provide us with even greater access to brand name and closeout products as major manufacturers seek a single buyer to acquire an entire deal.

We plan to further invest in our merchandising team in order to expand and

enhance our sourcing relationships and product categories, which we expect will drive shopping frequency and increase customer spending.

We will continue to enhance our supplier relationships and develop additional sources to acquire

brand name and closeout products for our customers.

Our direct buying relationships with many major manufacturers, wholesalers, distributors, brokers, and retailers provide us with significant opportunities to expand our ever-changing assortment of

brand name and closeout merchandise at extreme values.

As we continue to grow, we believe our increased scale will provide us with even greater access to brand name and closeout products as major manufacturers seek a single buyer to acquire an

We plan to further invest in our merchandising team in order to expand and enhance our sourcing relationships and product categories, which we expect will drive shopping frequency and increase customer spending.

Leverage and expand Ollie’s Army.

We intend to recruit new Ollie’s Army members and increase their frequency of store visits and spending by enhancing our distinctive, fun and recognizable marketing programs, building brand awareness, further rewarding

member loyalty and utilizing more sophisticated data-driven targeted marketing.

We believe these strategies, coupled with a larger store base, will enable us to increase the amount of sales driven by loyal Ollie’s Army customers seeking the

next great deal.

We intend to recruit new Ollie’s Army members and increase their frequency of store visits and spending

by enhancing our distinctive, fun and recognizable marketing programs, building brand awareness, further rewarding member loyalty and utilizing more sophisticated data-driven targeted marketing.

We believe these strategies, coupled with a larger

store base, will enable us to increase the amount of sales driven by loyal Ollie’s Army customers seeking the next great deal.

We operate in one reporting segment.

See Note 11, “Segment Reporting,” to our audited consolidated financial statements included elsewhere in this Annual Report on Form 10-K.

See Note 12, “Segment Reporting and Entity-Wide Information,” to our audited consolidated financial statements included elsewhere in this Annual Report on Form 10-K.

Our merchandise

We offer a highly differentiated, constantly evolving assortment of brand name merchandise across a broad range of categories at drastically reduced prices.

Our ever-changing assortment of

“Good Stuff Cheap” includes brand name and closeout merchandise from leading manufacturers.

We augment our brand name merchandise with opportunistic purchases of unbranded goods and our own domestic and direct-import private label brands in

underpenetrated categories to further enhance the assortment of products that we offer.

Brand name and closeout merchandise represented approximately 65% and non-closeout goods and private label products collectively represented approximately 35%

of the retail value of our 2021 merchandise purchases.

The percentage of non-closeout goods and private label products is higher than our historical average, reflecting higher average unit retail pricing of non-closeout direct import purchases

driven by higher freight costs due to global supply chain disruptions.

We believe our compelling value proposition and the unique nature of our merchandise offerings have fostered our customer appeal across a variety of demographics and

socioeconomic profiles.

Our warehouse format stores feature a broad number of categories including housewares, bed and bath, food, floor coverings, health and beauty aids, books and stationery, toys and electronics as

well as other products including hardware, candy, clothing, sporting goods, pet and lawn and garden products.

Our ever-changing assortment of “Good Stuff

Cheap” includes brand name and closeout merchandise from leading manufacturers.

We augment our brand name merchandise with opportunistic purchases of unbranded goods and our own domestic and direct-import private label brands in underpenetrated

categories to further enhance the assortment of products that we offer.

Brand name and closeout merchandise represented approximately 65% and non-closeout goods and private label products collectively represented approximately 35% of the retail value

of our 2022 merchandise purchases.

We believe our compelling value proposition and the unique nature of our merchandise offerings have fostered our customer appeal across a variety of demographics and socioeconomic profiles.

Our warehouse format stores feature a broad number of categories including housewares, bed and bath, food, floor coverings, health and beauty aids, books and stationery, toys, and electronics as well as

other products including hardware, candy, clothing, sporting goods, pet and lawn and garden products.

We focus on buying cheap to sell cheap and source products as unique buying opportunities present themselves.

Our merchandise mix is

designed to combine unique and brand name bargains at extremely attractive price points.

This approach results in frequently changing product assortments and localized offerings which encourage shopper frequency and a “shop now” sense of urgency

as customers hunt to discover the next deal.

The common element of our dynamic merchandise selection is the consistent delivery of great deals to our customers, with products offered at prices up to 70% below department stores and fancy

stores and up to 20-50% below mass market retailers.

Our merchandise mix is designed to

combine unique and brand name bargains at extremely attractive price points.

This approach results in frequently changing product assortments and localized offerings which encourage shopper frequency and a “shop now” sense of urgency as customers

hunt to discover the next deal.

The common element of our dynamic merchandise selection is the consistent delivery of great deals to our customers, with products offered at prices up to 70% below department stores and fancy stores and

up to 20-50% below mass market retailers.

Our product price tags allow customers to compare our competitor’s price against Ollie’s price to further highlight the savings they can realize by shopping at our stores.

Examples of our product offerings include:

utensils, dishes, appliances, plastic containers, cutlery, storage and garbage bags, detergents and cleaning supplies, cookware and glassware, fans and space heaters, candles, frames and giftware;

cooking utensils, dishes, appliances, plastic containers, cutlery, storage and garbage bags, detergents and cleaning supplies, cookware and

glassware, candles, hardware, frames, and giftware;

Bed and bath:

goods including bedding, towels, curtains and associated hardware;

packaged food

including coffee, bottled non-carbonated beverages, salty snacks, condiments, sauces, spices, dry pasta, canned goods, cereal and cookies;

household goods including bedding, towels, curtains, and associated hardware;

packaged food including coffee, bottled non-carbonated beverages, salty snacks, candy, condiments, sauces, spices, dry pasta, canned goods,

cereal, and cookies;

Floor coverings:

flooring, commercial and residential carpeting, area rugs and floor mats;

laminate flooring, commercial and residential carpeting, area rugs, and floor mats;

Books and stationery:

children’s, how-to, business, cooking, inspirational and coffee table books, greeting cards and various office supplies and party goods;

conditioners, home electronics, cellular accessories and as seen on television;

dolls, action

figures, puzzles, educational toys, board games and other related items;

novels, children’s, how-to, business, cooking, inspirational and coffee table books, greeting cards and various office supplies,

and party goods;

home electronics, cellular accessories, and as seen on television;

dolls, action figures, puzzles, educational toys, board games, and other related items;

Health and beauty aids:

personal care, hair care, oral care, health and wellness, including PPE related to the COVID-19 pandemic, over-the-counter medicine, first aid, sun care, and

personal grooming;

hardware, candy,

clothing, sporting goods, pet products, luggage, automotive, seasonal, furniture, summer furniture and lawn & garden.

The following chart shows the breakdown of our 2021 net sales by merchandise category:

personal care, hair care, oral care, health and wellness, over-the-counter medicine, first aid, sun

care, and personal grooming;

summer furniture, air conditioners, fans and space heaters and lawn & garden;

clothing, sporting goods, pet products, luggage, and automotive.

The following table shows the breakdown of our product offerings as a percentage of net sales for each of the last three fiscal years:

Percentage of Net Sales

Consumables includes items such as health and beauty aids, food, candy, and pet food.

Home includes items such as

housewares, domestics, floor coverings, and hardware.

Seasonal includes items such as summer furniture, air conditioners, fans and space heaters, toys, and lawn & garden.

Other includes items such as books and stationery, electronics, clothing, sporting goods, pet products, luggage, and automotive.

Product categories

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Brand name and closeout merchandise

Brand name and closeout merchandise represented approximately 65% of the retail value of our 2021 merchandise purchases, which is lower than our historical average, reflecting higher average

unit retail pricing of non-closeout direct import purchases driven by higher freight costs due to global supply chain disruptions.

Our focus is to provide huge savings to our customers primarily through brand name products across a broad range

of merchandise.

Brand name and closeout merchandise represented approximately 65% of the retail value of our 2022 merchandise purchases.

Our focus is to provide huge savings to our customers primarily through brand

name products across a broad range of merchandise.

Our experienced merchant team purchases deeply discounted, branded or closeout merchandise primarily from manufacturers, retailers, distributors, and brokers.

This merchandise includes overstocks, discontinued merchandise, package

changes, cancelled orders, excess inventory and buybacks from retailers and major manufacturers.

This merchandise includes overstocks,

discontinued merchandise, package changes, cancelled orders, excess inventory and buybacks from retailers, and major manufacturers.

Non-closeout goods/private label

Non-closeout and private label products collectively represented approximately 35% of the retail value of our 2021 merchandise purchases, which is higher than our historical average, reflecting

higher average unit retail pricing of non-closeout direct import purchases driven by higher freight costs due to global supply chain disruptions.

We augment the breadth of our brand name merchandise with non-closeout and private label

In categories where the consumer is not as brand conscious, such as food, home textiles, and furniture, or when we may not be offering a current brand name merchandise deal, we will buy deeply discounted unbranded merchandise.

extreme value offerings are mixed in the stores with our brand name merchandise.

Non-closeout and private label products collectively represented approximately 35% of the retail value of our 2022 merchandise purchases.

We augment the breadth of our brand name merchandise with

non-closeout and private label merchandise.

unbranded merchandise.

These extreme value offerings are mixed in the stores with our brand name merchandise.

We also have a variety of domestic and direct-import private label merchandise and exclusive products sold under numerous brands.

These high quality products are

developed in key categories such as housewares and are designed to create brand-like excitement and complement our brand name merchandise.

We also have licenses for private label products that use recognizable celebrity names or brand names.

routinely evaluate the quality and condition of these private label goods to ensure that we are delivering our customer a high quality product at a great price.

quality products are developed in key categories such as housewares and are designed to create brand-like excitement and complement our brand name merchandise.

We also have licenses for private label products that use recognizable celebrity names or

We routinely evaluate the quality and condition of these private label goods to ensure that we are delivering our customer a high quality product at a great price.

Merchandise procurement and distribution

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Merchandising team

Our 22-member merchant team maintains strong, long-standing relationships with a diverse group of suppliers, allowing us to procure branded merchandise at compelling values for our customers.

Our merchants specialize by department in order to build category expertise, in-depth knowledge and sourcing relationships.

We believe our buying approach, coupled with long-standing and newly formed relationships, enable us to find the best

deals from major manufacturers and pass drastically reduced prices along to our customers.

We plan to further invest in and grow our merchandising team in order to expand and enhance our sourcing relationships and product categories, which we

expect will drive shopping frequency and increase customer spending.

Our merchant team maintains strong, long-standing relationships with a diverse group of suppliers, allowing us to procure branded merchandise at compelling values for our customers.

Our merchants

specialize by department in order to build category expertise, in-depth knowledge and sourcing relationships.

We believe our buying approach, coupled with long-standing and newly formed relationships, enable us to find the best deals from major

manufacturers and pass drastically reduced prices along to our customers.

We plan to further invest in and grow our merchandising team in order to expand and enhance our sourcing relationships and product categories, which we expect will drive

shopping frequency and increase customer spending.

Merchandise procurement

We believe that our strong sourcing capabilities are the result of our tenured merchant team’s ability to leverage deep, long-standing relationships with hundreds of manufacturers, wholesalers,

brokers, retailers and other suppliers.

Our merchants maintain direct relationships with brand manufacturers, regularly attend major tradeshows and travel the world to source extreme value offerings across a broad assortment of product

We are an ideal partner to major manufacturers because our merchants are experienced and empowered to make quick decisions.

Each opportunity is unique and our merchants negotiate directly with the supplier to lock in a particular

Our ability to select the most attractive opportunistic purchases from a growing number of available deals enables us to provide a wide assortment of goods to our customers at great bargain prices.

We source from over 1,100 suppliers, and no supplier accounted for more than 5% of our purchases during 2021.

Our dedication to building strong relationships with suppliers is evidenced by a

17-year average relationship with our top 15 suppliers.

As we continue to grow, we believe our increased scale will provide us with even greater access to brand name products since many major manufacturers seek a single buyer to acquire the

We believe that our strong sourcing capabilities are the result of our tenured merchant team’s ability to leverage deep, long-standing relationships with hundreds of manufacturers, wholesalers, brokers,

retailers, and other suppliers.

Our merchants maintain direct relationships with brand manufacturers, regularly attend major tradeshows and travel the world to source extreme value offerings across a broad assortment of product categories.

ideal partner to major manufacturers because our merchants are experienced and empowered to make quick decisions.

Each opportunity is unique, and our merchants negotiate directly with the supplier to lock in a particular deal.

Our ability to select

the most attractive opportunistic purchases from a growing number of available deals enables us to provide a wide assortment of goods to our customers at great bargain prices.

We source from over 1,100 suppliers.

Our dedication to building strong relationships with suppliers is evidenced by an average relationship of over 15-years with our top 15 suppliers.

As we continue to

grow, we believe our increased scale will provide us with even greater access to brand name products since many major manufacturers seek a single buyer to acquire the entire deal.

Distribution and logistics

We have made significant investments in our distribution network and personnel to support our store growth plan.

Currently, we distribute approximately 95% of our merchandise from our

distribution centers in York, PA (603,000 square feet), Commerce, GA (962,000 square feet), and Lancaster, TX (615,000 square feet).

In order to minimize the amount of time our retail stores devote to inventory management, our merchandise is

seeded with price tickets and labeled with a bar code for shipping.

Currently, we distribute approximately 95% of our merchandise from our distribution

centers in York, PA (603,000 square feet), Commerce, GA (962,000 square feet), and Lancaster, TX (615,000 square feet).

We are in the process of expanding our York, PA distribution center, which will provide an additional 201,000 square feet of

distribution capacity, and is expected to be completed in the first half of 2023.

In order to minimize the amount of time our retail stores devote to inventory management, our merchandise is seeded with price tickets and labeled with a bar code for

On October 17, 2022, we entered into a purchase agreement to acquire a parcel of land in Princeton, Illinois for the construction of our fourth distribution center.

The purchase agreement is subject to

customary post-execution, pre-closing activities with an anticipated closing date in the first quarter of fiscal 2023.

Our stores generally receive shipments from our distribution centers one to two times a week, depending on the season and specific store size and sales volume.

We utilize independent third

party freight carriers and, on average, load and ship between 85 and 95 trucks per day.

We believe our current distribution capabilities can support a range of 500 to 600 stores over the next several years.

We utilize independent third party freight

With the expansion of our York, PA distribution center and the addition of our fourth distribution center, we believe our distribution capabilities will support over 700 stores.

As of January 28, 2023, we operated 468 stores, averaging approximately 33,000 square feet, across 29 contiguous states in the eastern half of the United States.

Our highly flexible real estate

approach has proven successful across all vintages, geographic regions, population densities, demographic groups, real estate formats and regardless of any co-tenant.

Our business model has resulted in positive financial performance during strong

and weak economic cycles.

We have successfully opened stores in nine new states since 2017, highlighting the portability of our new store model.

Our highly flexible real estate approach

has proven successful across all vintages, geographic regions, population densities, demographic groups, real estate formats and regardless of any co-tenant.

Our business model has resulted in positive financial performance during strong and weak

economic cycles.

We have successfully opened stores in six new states since 2018, highlighting the portability of our new store model.

The following map shows the number of stores in each of the states in which we operated as of January 28, 2023:

1 unchanged sentence

All of our warehouse format stores incorporate the same philosophy:

no-frills, bright, “semi-lovely” stores and a fun, treasure hunt shopping

We present our stores as “semi-lovely” to differentiate our stores from other traditional retailers, and to minimize operating and build-out costs.

Our stores also welcome our customers with vibrant and colorful caricatures together

with witty signage.

We attempt to make our customers laugh as we poke fun at ourselves and current events.

We believe that by disarming our customers by getting them to giggle a bit, they are able to look at and trust our products for what they

are—extremely great bargains.

We believe the store layout and merchandising strategy help to encourage a “shop now” sense of urgency and increase frequency of customer visits as

customers never know what they might come across in our stores.

no-frills, bright, “semi-lovely” stores and a fun, treasure hunt shopping experience.

We present our stores as “semi-lovely” to

differentiate our stores from other traditional retailers, and to minimize operating and build-out costs.

Our stores also welcome our customers with vibrant and colorful caricatures together with witty signage.

We attempt to make our customers laugh

as we poke fun at ourselves and current events.

We believe that by disarming our customers by getting them to giggle a bit, they are able to look at and trust our products for what they are—extremely great bargains.

We believe the store layout and merchandising strategy help to encourage a “shop now” sense of urgency and increase frequency of customer visits as customers never know what they might come across in

We make it easy for our customers to browse our stores by displaying our frequently changing assortment of products on rolling tables, pallets and other display fixtures.

team leaders are responsible for maintaining our treasure hunt shopping experience, keeping the stores clean and well-lit and ensuring our customers are engaged.

We believe our humorous brand image, compelling values and welcoming stores

resonate with our customers and define Ollie’s as a unique and comfortable destination shopping location.

Our store team leaders are responsible for maintaining our treasure

hunt shopping experience, keeping the stores clean and well-lit and ensuring our customers are engaged.

We believe our humorous brand image, compelling values and welcoming stores resonate with our customers and define Ollie’s as a unique and

comfortable destination shopping location.

Expansion opportunities and site selection

We believe we can profitably expand our store count on a national scale to more than 1,050 locations based on internal estimates and third party

research conducted by Hoffman Strategy Group.

Our disciplined real estate strategy focuses on infilling existing geographies as well as expanding into contiguous markets in order to leverage our distribution infrastructure, field management

team, store management, marketing investments and brand awareness.

We believe we can profitably expand our store count on a national scale to more than 1,050 locations based on internal estimates and third party research conducted by Hoffman Strategy Group.

disciplined real estate strategy focuses on infilling existing geographies as well as expanding into contiguous markets in order to leverage our distribution infrastructure, field management team, store management, marketing investments and brand

We maintain a pipeline of real estate sites that have been approved by our real estate committee.

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Stores closed

Stores re-opened

Stores open at end of year

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considerable time evaluating prospective sites before bringing a new lease proposal to our real estate committee, which is comprised of senior management and executive officers.

Our flexible store layout allows us to quickly take over a variety

of low-cost, second-generation sites, including former big box retail and grocery stores.

Our flexible store layout allows us to quickly take over a variety of

low-cost, second-generation sites, including former big box retail and grocery stores.

We believe there is an ample supply of suitable low-cost, second-generation real estate allowing us to infill within our existing markets as well as to expand into new, contiguous geographies.

By focusing on key characteristics such as proximity to the nearest Ollie’s store, ability to leverage distribution infrastructure, visibility, traffic counts, population densities of at least 50,000 people within ten miles and low rent per

square foot, we have developed a new store real estate model that has consistently delivered attractive returns on invested capital.

focusing on key characteristics such as proximity to the nearest Ollie’s store, ability to leverage distribution infrastructure, visibility, traffic counts, population densities of at least 50,000 people within ten miles and low rent per square foot,

we have developed a new store real estate model that has consistently delivered attractive returns on invested capital.

Our strong unit growth is supported by our predictable and compelling new store model.

We target a store size between 25,000 to 35,000 square feet and an average initial cash investment of

approximately $1.0 million, which includes store fixtures and equipment, store-level and distribution center inventory (net of payables) and pre-opening expenses.

With our relatively low investment costs and strong new store opening performance, we target first-year annual new store sales of approximately $4.0 million.

New stores opened from 2016 to 2020 have generated an average of $4.7 million in net

sales in their first full year of operations and produced an average payback period of approximately two years.

We believe that our consistent store performance, corporate infrastructure, including our distribution centers, and disciplined

approach to site selection support the portability and predictability of our new unit growth strategy.

We target a store size between 25,000 to 35,000 square feet and an average initial cash investment of approximately

$1.0 million, which includes store fixtures and equipment, store-level and distribution center inventory (net of payables) and pre-opening expenses.

relatively low investment costs and strong new store opening performance, we target first-year annual new store sales of approximately $4.0 million.

New stores opened from 2017 to 2021 have generated an average of $4.6 million in net sales in their

first full year of operations and produced an average payback period of approximately two years.

We believe that our consistent store performance, corporate infrastructure, including our distribution centers, and disciplined approach to site

selection support the portability and predictability of our new unit growth strategy.

Store-level management and training

Our Vice President of Store Operations oversees all store activities.

Our stores are grouped into four regions, divided generally along geographic lines.

We employ four regional directors, who

have responsibility for the day-to-day operations of the stores in their region.

Reporting to the regional directors are 45 district team leaders who each manage a group of stores in their markets.

At the store level, the leadership team consists

of a store team leader (manager), co-team leader (first level assistant manager) and assistant team leader (second level assistant manager).

Our stores are grouped into five regions, divided generally along geographic lines.

We employ regional directors, who have

responsibility for the day-to-day operations of the stores in their region.

Reporting to the regional directors are district team leaders and market team leaders who each manage a group of stores in their markets.

At the store level, the leadership

team consists of a store team leader (manager), co-team leader (first level assistant manager) and assistant team leader (second level assistant manager).

Supervisors oversee specific areas within each store.

Each store team leader is responsible for the daily operations of the store, including the processing of merchandise to the sales floor and the presentation of goods throughout the store.

team leaders are trained to maintain a clean and appealing store environment for our customers.

leaders are trained to maintain a clean and appealing store environment for our customers.

Store team leaders and co-team leaders are also responsible for the hiring, training, and development of associates.

We work tirelessly to hire talented people, to improve our ability to assess talent during the interview process and to regularly train those individuals at Ollie’s who are responsible for

interviewing candidates.

We work tirelessly to hire talented people, to improve our ability to assess talent during the interview process and to regularly train those individuals at Ollie’s who are responsible for interviewing

We also devote substantial resources to training our new managers through our Team Leader Training Program.

This program operates at designated training stores located across our footprint.

It provides an in-depth

review of our operations, including merchandising, policies and procedures, asset protection and safety, and human resources.

Part-time associates receive structured training as part of their onboarding throughout their first five scheduled

It provides an in-depth review of our

operations, including merchandising, policies and procedures, asset protection and safety, and human resources.

Part-time associates receive structured training as part of their onboarding.

For additional information on store-level management training and initiatives by the Company, see the discussion of Human Capital below.

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Our marketing and advertising campaigns feature colorful caricatures and witty sayings in order to make our customers laugh.

We believe that by disarming our customers by getting them to giggle

a bit, they are able to look at and trust our products for what they are—extremely great bargains.

Our distinctive and often self-deprecating humor and highly recognizable caricatures are used in all of our stores, flyers and advertising

We believe that by disarming our customers by getting them to giggle a bit,

they are able to look at and trust our products for what they are—extremely great bargains.

Our distinctive and often self-deprecating humor and highly recognizable caricatures are used in all of our stores, flyers and advertising campaigns.

We tailor our marketing mix and strategy for each market, deal or promotion.

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Print and direct mail :

During 2021, we

distributed over 677 million highly recognizable flyers.

Our flyers are distributed 22 times per year and serve as the foundation of our marketing strategy.

They highlight current deals to create shopping urgency and drive traffic and

increase frequency of store visits;

During 2022, we distributed over 700 million highly recognizable flyers.

Our flyers are distributed 22 times per year and serve as the foundation of

our marketing strategy.

They highlight current deals to create shopping urgency and drive traffic and increase frequency of store visits;

Television and radio :

We selectively utilize

creative television and radio advertising campaigns in targeted markets at certain times of the year, particularly during the holiday sales season, to create brand awareness and support new store openings;

We selectively utilize creative television and radio advertising campaigns in targeted markets at certain times of the year, particularly during the

holiday sales season, to create brand awareness and support new store openings;

Charity and community events :

We are dedicated

to maintaining a visible presence in the communities in which our stores are located through the sponsorship of charitable organizations such as Feeding America, Toys for Tots, Children’s Miracle Network, Cal Ripken, Sr.

Foundation and

the Kevin Harvick Foundation.

We believe supporting these organizations promotes our brand, underscores our values and builds a sense of community;

We are dedicated to maintaining a visible presence in the communities in which our stores are located through the sponsorship of charitable

organizations such as Feeding America, Toys for Tots, Children’s Miracle Network, Cal Ripken, Sr.

Foundation, and the Kevin Harvick Foundation.

We believe supporting these organizations promotes our brand, underscores our values and builds a

sense of community;

Digital marketing and social media :

maintain an active online presence and promote our brand through our website, our mobile app and social media channels.

We also utilize targeted email marketing to highlight our latest brand name offerings and drive traffic to our

We maintain an active online presence and promote our brand through our website, our mobile app and social media channels.

We also utilize

targeted email marketing to highlight our latest brand name offerings and drive traffic to our stores.

In addition, we invest in digital marketing where we target both our current and prospective customers.

We have entered into an agreement with Valassis Communications, Inc.

(“Valassis”) for marketing services.

This agreement has a guaranteed spend commitment of $23.0 million over a two-year

period ending May 28, 2022.

As of January 29, 2022, the Company has met its guaranteed spend commitment with Valassis.

Our customer loyalty program, Ollie’s Army, stands at 13.2 million members as of January 28, 2023, an increase of 4.8% from 2021.

In 2021, Ollie’s Army members accounted for over 79% of net

sales and spent approximately 40% more per shopping trip, on average, than non-members.

In 2022, Ollie’s Army members accounted for over 80% of net sales and

spent approximately 40% more per shopping trip, on average, than non-members.

Consistent with our marketing strategy, we engage new and existing Ollie’s Army members through the use of witty phrases and signage;

examples include

“Enlist in Ollie’s Army today,” “become one of the few, the cheap, the proud” and “Ollie’s Army Boot Camp…all enlistees will receive 15% off their next purchase.” Throughout the year, for every $250 Ollie’s Army members spend, they receive a

coupon for 10% off their next entire purchase.

examples include “Enlist in Ollie’s

Army today,” “become one of the few, the cheap, the proud” and “Ollie’s Army Boot Camp…all enlistees will receive 15% off their next purchase.” Throughout the year, for every $250 Ollie’s Army members spend, they receive a coupon for 10% off their

next entire purchase.

Ollie’s Army ‘ranks’ are another savings opportunity for members.

For the first $250 and $500 members spend in a calendar year, they receive a coupon for 20% and 30% off of one item, respectively.

Historically, Ollie’s Army members have demonstrated high redemption rates for promotional activities exclusive to Ollie’s Army members, such as our Valentine’s, Boot Camp and 15% off holiday mailers.

In addition, Ollie’s Army members have

historically enthusiastically responded to Ollie’s Army Night, an annual one-day after-hours sale in December exclusively for members.

We expect to continue leveraging the data gathered from our proprietary database of Ollie’s Army members to

better segment and target our marketing initiatives and increase shopping frequency.

Historically, Ollie’s Army

members have demonstrated high redemption rates for promotional activities exclusive to Ollie’s Army members, such as our Valentine’s, Boot Camp, and 15% off holiday mailers.

In addition, Ollie’s Army members have historically enthusiastically

responded to Ollie’s Army Night, an annual one-day after-hours sale in December exclusively for members.

We expect to continue leveraging the data gathered from our proprietary database of Ollie’s Army members to better segment and target our

marketing initiatives and increase shopping frequency.

We compete with a diverse group of retailers, including discount, closeout, mass merchant, department, grocery, drug, convenience, hardware, variety, online, and other specialty stores.

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Accordingly, we compete against a fragmented group of retailers, wholesalers, and jobbers to acquire merchandise for sale in our stores.

Our established relationships with our suppliers, coupled with our scale, associated buying power, financial credibility and responsiveness, often makes Ollie’s the first call for available

Our direct relationships with suppliers have increased as we have grown, and we continuously strive to broaden our supplier network.

Our established relationships with our suppliers, coupled with our scale, associated buying power, financial credibility and responsiveness, often makes Ollie’s the first call for available deals.

direct relationships with suppliers have increased as we have grown, and we continuously strive to broaden our supplier network.

Trademarks and other intellectual property

We own multiple state and federally registered trademarks related to our brand, including “Ollie’s,” “Ollie’s Bargain Outlet,” “Good Stuff Cheap,” “Ollie’s Army,” “Real Brands Real Cheap!” and

“Real Brands!

Real Bargains!,” among others.

In addition, we maintain a federal trademark for the image of Ollie, the face of our company.

We also own registered trademarks for many of our private labels such as “Sarasota Breeze,” “Steelton

Tools,” “American Way” and “Middleton Home,” among others.

We also own registered trademarks for many of our private labels such as “Sarasota Breeze,” “Steelton Tools,”

“American Way,” and “Middleton Home,” among others.

We routinely prosecute trademarks where appropriate, both for private label goods and to further identify our goods and services.

We enter into trademark license agreements as necessary,

which may include our private label offerings, such as the Magnavox products available in our stores.

We enter into trademark license agreements as necessary, which may

include our private label offerings, such as the Magnavox products available in our stores.

Our trademark registrations have various expiration dates;

however, assuming that the trademark registrations are properly renewed, they have a

perpetual duration.

We also own several domain names, including www.ollies.us, www.ollies.com, www.olliesbargainoutlet.com, www.olliesarmy.com, www.ollies.cheap, www.sarasotabreeze.com and www.olliesmail.com, and unregistered copyrights in our

website content.

however, assuming that the trademark registrations are properly renewed, they have a perpetual

We also own several domain names, including www.ollies.us, www.ollies.com, www.olliesbargainoutlet.com, www.olliesarmy.com, www.ollies.cheap, www.sarasotabreeze.com and www.olliesmail.com , and

unregistered copyrights in our website content.

We attempt to obtain registration of our trademarks and other intellectual property as practical and pursue infringement of those marks when appropriate.

Our management information systems provide a full range of business process assistance and timely information to support our merchandising team and strategy, management of multiple distribution

centers, stores and operations, and financial reporting.

We believe our current systems provide us with operational efficiencies, scalability, management control and timely reporting that allow us to identify and respond to merchandising and

operating trends in our business.

We use a combination of internal and external resources to support store point-of-sale, merchandise acquisition and distribution, inventory management, financial reporting, real estate and administrative

We continuously assess ways to maximize productivity and efficiency, as well as evaluate opportunities to further enhance our existing systems.

Our management information systems provide a full range of business process assistance and timely information to support our merchandising team and strategy, management of multiple distribution centers,

stores and operations, and financial reporting.

We believe our current systems provide us with operational efficiencies, scalability, management control and timely reporting that allow us to identify and respond to merchandising and operating trends

in our business.

We continuously

assess ways to maximize productivity and efficiency, as well as evaluate opportunities to further enhance our existing systems.

Our existing systems are scalable to support future growth.

Government regulation

We are subject to state and federal laws including labor and employment laws, including minimum wage requirements and wage and hour laws, laws governing advertising, privacy laws, safety

regulations, environmental laws and regulations, and other laws, including consumer protection regulations that regulate retailers and/or govern product standards, the promotion and sale of merchandise and the operation of stores and warehouse

We monitor changes in these laws and believe that we are in material compliance with all applicable laws.

We are subject to state and federal laws including labor and employment laws, including minimum wage requirements and wage and hour laws, laws governing advertising, privacy laws, safety regulations,

environmental laws and regulations, and other laws, including consumer protection regulations that regulate retailers and/or govern product standards, the promotion and sale of merchandise and the operation of stores and warehouse facilities.

monitor changes in these laws and believe that we are in material compliance with all applicable laws.

We source a portion of our products from outside the United States.

Foreign Corrupt Practices Act and other similar anti-bribery and anti-kickback laws and regulations generally

prohibit companies and their intermediaries from making improper payments to non-U.S.

Foreign Corrupt Practices Act and other similar anti-bribery and anti-kickback laws and regulations generally prohibit

companies and their intermediaries from making improper payments to non-U.S.

officials for the purpose of obtaining or retaining business.

Our policies and our vendor code of conduct mandate compliance with applicable law, including

these laws and regulations.

We maintain third-party insurance for a number of risk management activities, including workers’ compensation, general liability, commercial property, ocean marine, cyber, director and officer

and employee benefit related insurance policies.

We evaluate our insurance requirements on an ongoing basis to ensure we maintain adequate levels of coverage.

Our policies and our vendor code of conduct mandate compliance with applicable law, including these laws and

Human Capital

Attracting, developing, and retaining quality talent is key to our growth, and our success depends

on cultivating an engaged and motivated workforce.

We work hard to create an environment where Ollie’s team members can build fulfilling careers and we

take pride in providing opportunities for growth and development.

We seek to build a diverse and inclusive workplace where we can leverage our collective talents,

striving to ensure that all associates are treated with dignity and respect.

We believe that a workforce with a diversity of viewpoints, background, experience and industry knowledge, as

well as more traditional characteristics of diversity, such as race and gender, are key to our culture and long-term success.

We are committed to providing equal employment opportunities and advancement consideration to all individuals based

on job-related qualifications and ability to perform the job as well as maintaining an environment that is free of intimidation or harassment.

We value the talents and contributions of our associates and by focusing on our team members we know

that the entire Ollie’s community will be well served.

Attracting, developing, and retaining quality talent is key to our growth, and our success depends on cultivating an engaged and motivated workforce.

We work hard to create an environment where Ollie’s team members can build fulfilling careers and we take pride in providing opportunities for growth and development.

We seek to build a diverse and inclusive workplace where we can leverage our collective talents, striving to ensure that all associates are treated with dignity and respect.

believe that a workforce with a diversity of viewpoints, background, experience and industry knowledge, as well as more traditional characteristics of diversity, such as race and gender, are key to our culture and long-term success.

We are committed

to providing equal employment opportunities and advancement consideration to all individuals based on job-related qualifications and ability to perform the job as well as maintaining an environment that is free of intimidation or harassment.

value the talents and contributions of our associates and by focusing on our team members we know that the entire Ollie’s community will be well served.

Oversight and Management

Our Human Resources department manages all associate matters, including recruiting, hiring, compensation and benefits, performance management, and associate training.

In addition, our management team works closely

with the Human Resources department to evaluate associate management issues such as retention and workplace safety.

As we strive to retain and engage talent at all levels of our business, our Human Resources department also reviews our retention

and turnover rates and administers our talent and training programs and review process to support the development of our talent pipeline.

In addition, our management team works closely with

the Human Resources department to evaluate associate management issues such as retention and workplace safety.

As we strive to retain and engage talent at all levels of our business, our Human Resources department also reviews our retention and

turnover rates and administers our talent and training programs and review process to support the development of our talent pipeline.

As of January 28, 2023, we employed over 10,700 associates, approximately 4,900 of whom were full-time and approximately 5,800 of whom were part-time.

Of our total associate base, approximately 900 were based at our

store support center, approximately 800 were employed at our distribution centers, and the remaining were store and field associates.

The number of associates in a fiscal year fluctuates depending on the business needs at different times of the

In 2021, we employed approximately 2,600 additional seasonal associates during our peak holiday sales season.

As of January 29, 2022, approximately 60% of our workforce is self-identified female and

approximately 40% is self-identified male.

store support center and distribution centers, and the remaining were store and field associates.

The number of associates in a fiscal year fluctuates depending on the business needs at different times of the year.

of January 28, 2023, approximately 60% of our workforce is self-identified female and approximately 40% is self-identified male.

Over 38% of our workforce has self-identified as having a racial or ethnic minority background.

None of our associates belong to a union or are party to any collective bargaining or similar

associates belong to a union or are party to any collective bargaining or similar agreement.

Associate Training and Development Programs

We offer a compelling work environment with meaningful growth and career-development opportunities.

This starts with the opportunity to do challenging work and learn on the job and is

supplemented by programs and continuous learning that help our team build skills to advance.

This starts with the opportunity to do challenging work and learn on the job and is supplemented by

programs and continuous learning that help our team build skills to advance.

We encourage a promote-from-within environment when internal resources permit.

We also provide internal leadership development programs designed to

prepare our high-potential team members for greater responsibility.

We also provide internal leadership development programs designed to prepare our

high-potential team members for greater responsibility.

Our current team of district managers and store managers have an average tenure of approximately six and four years, respectively.

We believe internal promotions, coupled with

the hiring of individuals with previous retail experience, will provide the management structure necessary to support our long-term strategic growth initiatives.

We believe internal promotions, coupled with the hiring of

individuals with previous retail experience, will provide the management structure necessary to support our long-term strategic growth initiatives.

Our Ollie’s Leadership Institute (“OLI”) is a program that is used to equip field associates with the ability to advance their career.

Each OLI participant receives an individual development plan, designed to

prepare them for their next level position.

Each OLI participant receives an individual development plan, designed to prepare

them for their next level position.

Reflecting our belief in our “home grown” talent, OLI is our preferred source for new supervisors and team leaders.

In 2021, over 45% of our current district team leaders were internally promoted to

their position.

In 2022, over 45% of our current district team leaders were internally promoted to their

Company-wide, over 60% of our field positions were filled by internal promotions.

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We are committed to providing market-competitive compensation for all positions.

Eligible team members participate in one of our various bonus incentive programs, which provide

the opportunity to receive additional compensation based upon store and/or Company performance.

In addition, we provide our eligible team members the opportunity to participate in a 401(k) retirement savings plan with a Company-sponsored

We also share in the cost of health insurance provided to eligible team members, and team members receive a discount on merchandise purchased from the Company.

Eligible team members participate in one of our various bonus incentive programs, which provide the

opportunity to receive additional compensation based upon store and/or Company performance.

In addition, we provide our eligible team members the opportunity to participate in a 401(k) retirement savings plan with a Company-sponsored match.

also share in the cost of health insurance provided to eligible team members, and team members receive a discount on merchandise purchased from the Company.

We additionally provide our team members with paid time off.

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Maintaining a safe and secure work environment is very important to us and we conduct our business in an environmentally sound manner based on customer needs and local requirements.

To that end, we have

introduced safety protocols in response to the COVID-19 pandemic to ensure our stores, distribution centers and support center facilities are safe for both our customers and team members (see below).

To further promote a safe work environment,

we have established safety training programs.

To further promote a safe work

environment, we have established safety training programs.

This includes administering an occupational injury- and illness-prevention program, together with an employee assistance program for team members.

COVID-19 Response

The COVID-19 pandemic has significantly impacted the U.S.

and global economies, resulting in, among other things, changes in the mindset and availability of the labor force.

We are experiencing labor pressures at

both our stores and distribution centers, higher import and trucking costs, and supply chain disruptions due to the impacts of COVID-19 and related measures.

We are increasing our hiring efforts in certain impacted markets and working closely

with our suppliers and transportation partners to mitigate the impact of the supply chain challenges.

We continue to monitor the impact of the pandemic on our business, including on our associates, customers, business partners and supply chain.

Our top priorities in responding to the pandemic have been and continue to be the safety and well-being of our associates and customers.

We are committed to maintaining a safe work and shopping environment.

response to COVID-19, we have taken several actions, including the following:

implemented procedures for social distancing, cleaning, sanitation, and use of personal protective equipment in our stores, distribution centers, and store support center to adhere to the appropriate CDC

and local guidelines;

supported our team members with COVID-19 paid medical leave and 100% coverage of COVID-19 testing and treatment under our medical plan;

supported our communities by raising money to provide much needed funding to local food banks through a partnership with Feeding America.

Our business is seasonal in nature and demand is generally the highest in our fourth fiscal quarter due to the holiday sales season.

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merchandise than we carry during other times of the year and generally engage in additional marketing efforts.

We expect inventory levels, along with accounts payable and accrued expenses, to reach their highest levels in our third and fourth

fiscal quarters in anticipation of increased net sales during the holiday sales season.

We expect inventory levels, along with accounts payable and accrued expenses, to reach their highest levels in our third and fourth fiscal

quarters in anticipation of increased net sales during the holiday sales season.

As a result of this seasonality, and generally because of variation in consumer spending habits, we experience fluctuations in net sales and working capital

requirements during the year.

Because we offer a broad selection of merchandise at extreme values, we believe we are generally less impacted than other retailers by economic cycles which correspond with declines in general consumer spending

habits and we believe we still benefit from periods of increased consumer spending.

Because we offer a broad selection of merchandise at extreme values, we believe we are generally less impacted than other retailers by economic cycles, which correspond with declines in general consumer spending habits

and we believe we still benefit from periods of increased consumer spending.

Available Information

Our annual reports on Form 10-K, quarterly reports on Form 10-Q, current reports on Form 8-K and amendments to those reports filed or furnished pursuant to Section 13(a) or 15(d) of the Securities and Exchange Act

are available free of charge on our website, www.ollies.us, as soon as reasonably practicable after the electronic filing of such reports with the Securities and Exchange Commission (“SEC”).

The SEC maintains a website (www.sec.gov) that

contains reports, proxy and information statements and other information regarding issuers that file electronically with the SEC.

available free of charge on our website, www.ollies.us, as soon as reasonably practicable after the electronic filing of such reports with the Securities and Exchange Commission (“SEC”).

The SEC maintains a website (www.sec.gov) that contains

reports, proxy, and information statements and other information regarding issuers that file electronically with the SEC.

Investing in our common stock involves a high degree of risk.

You should carefully consider the following risk factors, as well as other information in this Annual Report on

Form 10-K, before deciding whether to invest in the shares of our common stock.

You should carefully consider the following risk factors, as well as other information in this Annual Report on Form

10-K, before deciding whether to invest in the shares of our common stock.

The occurrence of any of the events described below could have a material adverse effect on our business, financial condition or results of operations.

In the case of

such an event, the trading price of our common stock may decline and you may lose all or part of your investment.

In the case of such an

event, the trading price of our common stock may decline and you may lose all or part of your investment.

RISK FACTOR SUMMARY

We are providing the following summary of the risk factors contained in our Form 10-K to enhance the readability and accessibility of our risk factor disclosures.

We encourage our stockholders

to carefully review the full risk factors contained in this Form 10-K in their entirety for additional information regarding the risks and uncertainties that could cause our actual results to vary materially from recent results or from our

anticipated future results.

We encourage our stockholders to

carefully review the full risk factors contained in this Form 10-K in their entirety for additional information regarding the risks and uncertainties that could cause our actual results to vary materially from recent results or from our anticipated

future results.

Risks Related to Business and Operations

The impact of COVID-19 on our business, operating results, cash flows, year-over-year performance and/or financial condition is significant and uncertain, and the impact could be material and adverse;

Vaccine mandates and other governmental regulations relating to the ongoing COVID-19 pandemic could have a material adverse impact on our business, financial conditions, results of operations, and

The impact of COVID-19 and the related testing and vaccination may result in us not being able to accurately forecast health care and other benefit costs, and we are uncertain whether future health care and other benefit costs could

exceed our projections;

We may not be able to execute our opportunistic buying strategy;

Fluctuations in comparable store sales and results of operations, including fluctuations on a quarterly basis, could cause our business performance to decline substantially;

Consumer confidence and spending may be reduced in light of factors beyond our control and our financial results may suffer;

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Our lack of an online shopping option may mean that we face challenges to grow and retain customers.

Our customers, including our loyalty program members, may determine to shop at other

stores or through web-enabled services and therefore not be as likely to shop at our stores;

Our customers, including our loyalty program members, may determine to shop at other stores or

through web-enabled services and therefore not be as likely to shop at our stores;

We may not be able to develop and operate our multiple distribution centers in an efficient or effective manner and that could mean that we do not have sufficient inventory in our store locations.

The loss or disruption of one or more

of our distribution centers or disruption of our supply chain or third-party shipping carriers could also make it difficult for us to timely receive or distribute goods to our stores;

The loss or disruption of one or more of

our distribution centers or disruption of our supply chain or third-party shipping carriers could also make it difficult for us to timely receive or distribute goods to our stores;

External economic pressures over which we have no or limited control, including inflation, occupancy costs, and transportation costs may reduce our profitability;

Inventory management and/or shrinkage or the loss or theft of inventory can result in material negative impacts on our results of operations;

We need to be able to hire and retain the right people to run our stores and our distribution

We also need to hire and retain managerial personnel, a merchant team and executive officers.

We need to be able to hire and retain the right people to run our stores and our distribution centers.

We also need to hire and retain managerial personnel, a merchant team, and

executive officers.

If we are not effective in these areas, our results may suffer;

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BUSINESS AND OPERATIONS

The COVID-19 pandemic has disrupted and is expected to continue to disrupt our business, which could have a material adverse impact on our business,

results of operations, liquidity and financial condition for an extended period of time.

During March 2020, the World Health Organization declared the COVID-19 outbreak to be a global pandemic.

The COVID-19 pandemic has significantly impacted health and economic conditions

throughout the United States, as public concern about becoming ill with the virus has led to the issuance of recommendations and/or mandates from federal, state and local authorities to practice social distancing or self-quarantine.

course of 2021, we continued to operate our stores as we qualified under definitions of an “essential” business.

In response to the challenges of COVID-19, at times we have had to implement reduced store hours, limit the number of customers in

our stores at any one time and implement social-distancing guidelines throughout our store operating space.

If the classification of what is an “essential” business changes in jurisdictions where our stores are located, or the restrictions on retail operations in our markets are reinstituted, or

other government regulations are adopted pertaining to how we may operate our stores, we may be required to temporarily close or restrict operations at one or more, if not all, of our stores, which would significantly impact our sales and results

of operations.

Also, if we do not respond appropriately to the pandemic, or if customers do not perceive our response to be adequate for a particular region or our company as a whole, we could suffer damage to our reputation and our brand, which

could adversely affect our business in the future, and subject us to costly litigation, enforcement actions and penalties.

COVID-19 has also impacted our supply chain for products we sell, particularly those products that are sourced internationally.

To the extent one or more of our vendors is negatively impacted

by COVID-19, including due to the closure of its distribution centers or manufacturing facilities, we may be unable to maintain delivery schedules or adequate inventory in our stores.

The impacts of the uncertainties surrounding the outbreak of COVID-19 also make it more challenging for us to estimate future performance of the business, predict customer acceptance of new

products and offerings, and to develop growth strategies for the future.

We are continuing to monitor the spread of COVID-19 and the related risks to our business and operations.

The magnitude and duration of the pandemic and its impact on our

business, results of operations, cash flows, financial position, employees, and customers are uncertain as this situation continues to evolve globally.

The extent to which the COVID-19 outbreak impacts our business, results of operations, and financial condition will depend on future developments, which are highly uncertain and cannot be

predicted, including, but not limited to the duration, spread, severity and impact of the COVID-19 outbreak, the effects of the outbreak on our customers, employees and vendors, the regulatory response and impact of stimulus measures adopted by

local, state and federal governments, and to what extent normal economic and operating conditions can resume.

Even after the COVID-19 outbreak has subsided, we could experience materially adverse impacts to our business as a result of any

economic disruption that has occurred or may occur in the future due to a continued erosion in consumer sentiment or the effect of unemployment on our consumer base.

Additionally, the consumer preferences for certain product categories that have

driven positive sales during the height of the COVID-19 outbreak may not continue after the outbreak has subsided, and any change in consumer preferences could negatively impact our results of operations.

Furthermore, the financial condition of

our customers and vendors may be adversely impacted by the pandemic, which may result in a decrease in discretionary consumer spending and our store traffic and sales, and an increase in bankruptcies or insolvencies with respect to our vendors.

These events may, in turn, have a material adverse impact on our business, results of operations, liquidity and financial condition.

In the event of a prolonged material economic downturn, including circumstances that require us to close a large

portion of our stores or cause us to experience a further reduction in store traffic, we may not be able to comply with the financial covenants in our credit facility, which could negatively impact our ability to borrow under that facility or

with other lenders and negatively impact our liquidity position.

We may not be able to execute our opportunistic buying strategy, adequately manage our supply of inventory or anticipate customer demand, which could have

a material adverse effect on our business, financial condition and results of operations.

We may not be able to execute our opportunistic buying strategy, adequately manage our supply of inventory or anticipate customer demand, which could have a

material adverse effect on our business, financial condition and results of operations.

Our business is dependent on our ability to strategically source a sufficient volume and variety of brand name merchandise at opportunistic pricing.

We do not have significant control over the

supply, design, function, cost or availability of many of the products that we offer for sale in our stores.

Additionally, because a substantial amount of our store products are sourced by us from suppliers on a closeout basis or with

significantly reduced prices for specific reasons, we are not always able to purchase specific merchandise on a recurring basis.

We do not have long-term contracts with our suppliers and, therefore, we have no contractual assurances of pricing or

access to products and any supplier could discontinue sales to us at any time or offer us less favorable terms on future transactions.

We generally make individual purchase decisions for products that become available, and these purchases may be

for large quantities that we may not be able to sell on a timely or cost-effective basis.

To the extent that certain of our suppliers are better able to manage their inventory levels and reduce the amount of their excess inventory, the amount of

discount or closeout merchandise available to us could also be materially reduced, potentially compromising profit margin goals for procured merchandise.

Due to economic uncertainties, governmental orders, or other challenges relating to the

ongoing COVID-19 pandemic, one or more of our suppliers could become unable to continue supplying discounted or closeout merchandise on terms or in quantities acceptable or desirable to us.

We also compete with other retailers, wholesalers and

jobbers for discounted or closeout merchandise to sell in our stores.

Those businesses may be better able to anticipate customer demand or procure desirable goods.

Shortages or disruptions in the availability of brand name or unbranded products

of a quality acceptable to our customers and us could have a material adverse effect on our business, financial condition and results of operations and also may result in customer dissatisfaction.

In addition, we may significantly overstock

products that prove to be undesirable and be forced to take significant markdowns.

We cannot ensure that our merchant team will continue to identify the appropriate customer demand and take advantage of appropriate buying opportunities, which

could have a material adverse effect on our business, financial condition and results of operations.

We do not have significant control over the supply,

design, function, cost or availability of many of the products that we offer for sale in our stores.

Additionally, because a substantial amount of our store products are sourced by us from suppliers on a closeout basis or with significantly reduced

prices for specific reasons, we are not always able to purchase specific merchandise on a recurring basis.

We do not have long-term contracts with our suppliers and, therefore, we have no contractual assurances of pricing or access to products and

any supplier could discontinue sales to us at any time or offer us less favorable terms on future transactions.

We generally make individual purchase decisions for products that become available, and these purchases may be for large quantities that

we may not be able to sell on a timely or cost-effective basis.

To the extent that certain of our suppliers are better able to manage their inventory levels and reduce the amount of their excess inventory, the amount of discount or closeout

merchandise available to us could also be materially reduced, potentially compromising profit margin goals for procured merchandise.

Due to economic uncertainties, governmental orders, or other challenges, one or more of our suppliers could become

unable to continue supplying discounted or closeout merchandise on terms or in quantities acceptable or desirable to us.

We also compete with other retailers, wholesalers and jobbers for discounted or closeout merchandise to sell in our stores.

businesses may be better able to anticipate customer demand or procure desirable goods.

Shortages or disruptions in the availability of brand name or unbranded products of a quality acceptable to our customers and us could have a material adverse

effect on our business, financial condition and results of operations and also may result in customer dissatisfaction.

In addition, we may significantly overstock products that prove to be undesirable and be forced to take significant markdowns.

cannot ensure that our merchant team will continue to identify the appropriate customer demand and take advantage of appropriate buying opportunities, which could have a material adverse effect on our business, financial condition, and results of

Risks associated with or faced by our suppliers could adversely affect our financial performance.

We source our merchandise from a variety of suppliers, and we depend on them to supply merchandise in a timely and efficient manner.

If one or more of our current suppliers became unable to

supply goods, we believe we generally would be able to obtain alternative sources, but it could increase our merchandise costs and supply chain lead time, potentially resulting in temporary reduction in store inventory levels, and reduce the

selection and quality of our merchandise.

An inability to obtain alternative sources could materially decrease our sales.

Additionally, if a supplier fails to deliver on its commitments, we could experience merchandise out-of-stocks that could

lead to lost sales and reputational harm.

Further, failure of suppliers to meet our compliance protocols could prolong our procurement lead time, resulting in lost sales and adverse margin impact.

Changes to the prices and flow of certain goods

are, at times, for reasons beyond our control, such as political or civil unrest, acts of war, currency fluctuations, disruptions in maritime lanes, port labor disputes, economic conditions and instability in countries in which foreign suppliers

are located, the financial instability of suppliers, failure to meet our terms and conditions or our standards, issues with our suppliers’ labor practices or labor disruptions they may experience (such as strikes, stoppages or slowdowns, which

could also increase labor costs during and following the disruption), the availability and cost of raw materials, pandemic outbreaks, merchandise quality or safety issues, transport availability and cost, increases in wage rates and taxes,

transport security, inflation, and other factors relating to suppliers.

Such changes could adversely affect our operations and profitability.

If one or more of our current suppliers became unable to supply

goods, seeking alternative sources could increase our merchandise costs and supply chain lead time, potentially resulting in temporary reduction in store inventory levels, and reduce the selection and quality of our merchandise.

An inability to

obtain alternative sources could materially decrease our sales.

Additionally, if a supplier fails to deliver on its commitments, we could experience merchandise out-of-stocks that could lead to lost sales and reputational harm.

Further, failure of

suppliers to meet our compliance protocols could prolong our procurement lead time, resulting in lost sales and adverse margin impact.

Changes to the prices and flow of certain goods are, at times, for reasons beyond our control, such as political or

civil unrest, acts of war, currency fluctuations, disruptions in maritime lanes, port labor disputes, economic conditions and instability in countries in which foreign suppliers are located, the financial instability of suppliers, failure to meet our

terms and conditions or our standards, issues with our suppliers’ labor practices or labor disruptions they may experience (such as strikes, stoppages or slowdowns, which could also increase labor costs during and following the disruption), the

availability and cost of raw materials, pandemic outbreaks, merchandise quality or safety issues, transport availability and cost, increases in wage rates and taxes, transport security, inflation, and other factors relating to suppliers.

could adversely affect our operations and profitability.

Fluctuations in comparable store sales and results of operations, including fluctuations on a quarterly basis, could cause our business performance to decline

substantially.

Our results of operations have fluctuated in the past, including on a quarterly basis, and can be expected to continue to fluctuate in the future.

Our comparable store sales and results of operations are affected by a variety of factors, including:

national and regional economic trends in the United States;

changes in gasoline prices;

changes in our merchandise mix;

changes in pricing;

changes in the timing of promotional and advertising efforts;

holidays or seasonal periods.

If our future comparable store sales fail to meet expectations, then our cash flow and profitability could decline substantially, which could have a material adverse effect on our business, financial condition, and

results of operations.

We rely on third parties to move goods through ports and transport them from ports to our centralized distribution centers.

Our ability to timely and effectively deliver goods to our stores relies in part on shipping and transportation partners to timely and safely move our goods from manufacturing facilities to

ports and then onto oceangoing carriers.

Our ability to timely and effectively deliver goods to our stores relies in part on shipping and transportation partners to timely and safely move our goods from manufacturing facilities to ports and

then onto oceangoing carriers.

The demand for space onboard oceangoing vessels can vary and costs to secure space can vary greatly.

We may be subject to higher transportation costs or be unable to secure space for containers on

economically reasonable terms.

We may be subject to higher transportation costs or be unable to secure space for containers on economically

reasonable terms.

In addition, there may be labor or other disputes at either ports of departure or at ports of entry that may delay or otherwise hinder the flow of goods.

Additional factors, such as customs or border control

policies, may further delay or hinder transportation of goods or the costs to obtain them.

There are multiple factors in the transportation of goods from the manufacturer that are both outside of our control and which may negatively impact the

cost of the goods or the timeframes in which we receive them.

In addition to the many and varied costs that are associated with COVID-19, our ability to predict healthcare and other benefit costs may be limited.

COVID-19 and the related testing and vaccination costs are inherently uncertain and therefore very difficult to predict.

These costs, and the costs associated with other healthcare impacts of

COVID-19, may significantly impair our ability to timely and accurately forecast health care and other benefit costs for this or further periods.

As a result, we may have difficulty establishing accurate budgetary reserves or estimates for these

and other costs, which could in turn, negatively impact our results of operations and expenses.

Factors such as inflation, cost increases and energy prices could have a material adverse effect on our business, financial condition and results of

Future increases in costs, such as the cost of merchandise, shipping rates, freight costs (including import costs) and store occupancy costs, may reduce our profitability, given our pricing

These cost increases may be the result of inflationary pressures, geopolitical factors or public policies, which could further reduce our sales or profitability.

Increases in other operating costs, including changes in energy prices, wage

rates and lease and utility costs, may increase our cost of goods sold or selling, general and administrative expenses.

Our low-price model and competitive pressures in our industry may have the effect of inhibiting our ability to reflect these

increased costs in the prices of our products and, therefore, reduce our profitability and have a material adverse effect on our business, financial condition and results of operations.

Vaccine mandates and other governmental regulations relating to the ongoing COVID-19 pandemic could have a material adverse impact on our business,

financial conditions, results of operations, and prospects.

On November 4, 2021, the U.S.

Department of Labor’s Occupational Safety and Health Administration (“OSHA”) issued an emergency temporary standard (“ETS”) regulation requiring all employers with

at least 100 employees have their employees be vaccinated or tested weekly.

On January 13, 2022, the United States Supreme Court (“Court”) granted emergency relief and stayed implementation of the ETS.

The Court held that the challengers were

likely to succeed on their argument that OSHA lacked the authority to promulgate the ETS and enforcement of the ETS should be stayed pending further review.

On January 26, 2022, OSHA withdrew the ETS as an enforceable emergency temporary

standard but stated that the ETS will continue to serve as a proposed rule for a permanent standard under the Occupational Safety and Health Act of 1970.

As a company with about 10,000 employees, it is anticipated that, should the ETS or similar regulations go into effect, we could be subject to COVID-19 vaccination and/or testing mandates.

Should the mandates apply to us, we may be required to implement a requirement that all of our employees get vaccinated or be frequently tested, subject to limited exceptions.

At this time, it is not possible to predict the impact that a vaccine

and testing mandate, or a vaccine requirement should we adopt one, will have on us or on our workforce.

Any vaccine requirement or vaccine mandate, if implemented, may result in disruptions to our retail store operations, distribution operations,

employee attrition and increased labor costs, which could materially and adversely affect our business and results of operations.

Our ability to generate revenues is dependent on consumer confidence and spending, which may be subject to factors beyond our control, including changes in

economic and political conditions, and health concerns.

Additional factors, such as customs or border control policies, may further

delay or hinder transportation of goods or the costs to obtain them.

There are multiple factors in the transportation of goods from the manufacturer that are both outside of our control and which may negatively impact the cost of the goods or the

timeframes in which we receive them.

Factors such as inflation, cost increases and energy prices could have a material adverse effect on our business, financial condition and results of operations.

Future increases in costs, such as the cost of merchandise, shipping rates, freight costs (including import costs) and store occupancy costs, may reduce our profitability, given our pricing model.

cost increases may be the result of inflationary pressures, geopolitical factors, or public policies, which could further reduce our sales or profitability.

Increases in other operating costs, including changes in energy prices, wage rates, and lease

and utility costs, may increase our cost of goods sold or selling, general, and administrative expenses.

Our low-price model and competitive pressures in our industry may have the effect of inhibiting our ability to reflect these increased costs in

the prices of our products and, therefore, reduce our profitability and have a material adverse effect on our business, financial condition, and results of operations.

Our ability to generate revenues is dependent on consumer confidence and spending, which may be subject to factors beyond our control, including changes in economic and political

conditions, and health concerns.

The success of our business depends, to a significant extent, on the level of consumer confidence and spending.

A number of factors beyond our control affect the level of customer confidence and spending on

merchandise that we offer, including, among other things:

A number of factors beyond our control affect the level of customer confidence and spending on merchandise

that we offer, including, among other things:

energy and gasoline prices;

disposable income of our customers, which may be impacted by unemployment levels, personal debt levels and minimum wages;

interest rates and inflation;

discounts, promotions, and merchandise offered by our competitors;

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general economic and industry conditions;

interest rates and inflation;

the state of the housing market;

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Reduced customer confidence and spending cutbacks may result in reduced demand for our merchandise, including discretionary items, and may force us to take inventory markdowns.

Reduced demand also may require

increased selling and promotional expenses.

Reduced demand also may require increased

selling and promotional expenses.

Adverse economic conditions and any related decrease in customer demand for our merchandise could have a material adverse effect on our business, financial condition, and results of operations.

example, recent fears of contagion or disease related to the widespread outbreak of COVID-19 may cause customers to avoid shopping at brick and mortar retailers or reduce the number of trips they will make to our stores.

Similarly, negative

economic conditions related to this outbreak may limit the amount of disposable income available to our customers, which may limit our consumer demand.

Many of the factors identified above also affect commodity rates, transportation costs, costs of labor, insurance and healthcare, the strength of the U.S.

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Our long-term business strategy does not presently include the development of online retailing capabilities.

To the extent that we implement online operations, we would incur substantial

expenses related to such activities and would be exposed to additional cybersecurity risks.

Furthermore, any development of an online retail marketplace is a complex undertaking, and there is no guarantee that any resources we apply to this

effort will result in increased revenues or operating performance.

However, with the growing acceptance of online shopping, which may have accelerated as a result of the COVID-19 pandemic, both among consumers who previously shopped online and

consumers who did not previously do so, or did not do so as frequently, we may continue to face challenges related to customers shopping in brick and mortar stores.

In addition, the increased proliferation of mobile devices, enhanced and robust

connections to mobile networks, competition from other retailers in the online retail marketplace is expected to continue to increase and may negatively impact our results of operations.

Certain of our competitors and a number of pure online

retailers have established robust online operations.

Increased competition from online retailers and our lack of an online retail presence may reduce our customers’ desire to purchase goods from us and could have a material adverse effect on our

business, financial condition and results of operations.

To the extent that we implement online operations, we would incur substantial expenses

related to such activities and would be exposed to additional cybersecurity risks.

Furthermore, any development of an online retail marketplace is a complex undertaking, and there is no guarantee that any resources we apply to this effort will result

in increased revenues or operating performance.

However, with the growing acceptance of online shopping, which may have accelerated as a result of the COVID-19 pandemic, both among consumers who previously shopped online and consumers who did not

previously do so, or did not do so as frequently, we may continue to face challenges related to customers shopping in brick and mortar stores.

In addition, the increased proliferation of mobile devices, enhanced and robust connections to mobile

networks, competition from other retailers in the online retail marketplace is expected to continue to increase and may negatively impact our results of operations.

Certain of our competitors and a number of pure online retailers have established

robust online operations.

Increased competition from online retailers and our lack of an online retail presence may reduce our customers’ desire to purchase goods from us and could have a material adverse effect on our business, financial condition,

and results of operations.

If consumers determine to shop more online due to cultural or health concerns, they may be less likely to return to brick and mortar retailers in the future.

Labor shortages and increased turnover or increases in employee and employee-related costs could have adverse effects on our profitability.

We have recently experienced increased labor shortages at some of our locations.

While we have historically experienced some level of ordinary course turnover of employees, the COVID-19

pandemic and resulting actions and impacts have exacerbated labor shortages and increased turnover.

A number of factors have had and may continue to have adverse effects on the labor force available to us, including reduced employment pools,

federal unemployment subsidies, including unemployment benefits offered in response to the COVID-19 pandemic, and other government regulations, which include laws and regulations related to workers’ health and safety, wage and hour practices and

Labor shortages and increased turnover rates within our team members have led to and could in the future lead to increased costs, such as increased overtime to meet demand and increased wage rates to attract and retain employees and

could negatively affect our ability to efficiently operate our production facilities or otherwise operate at full capacity.

An overall or prolonged labor shortage, lack of skilled labor, increased turnover or labor inflation could have a material

adverse impact on our operations, results of operations, liquidity or cash flows.

We have recently experienced, and expect to continue to experience, increased labor shortages at some of our locations.

While we have historically experienced some level of ordinary course turnover of

employees, the COVID-19 pandemic and resulting actions and impacts have exacerbated labor shortages and increased turnover.

A number of factors have had and may continue to have adverse effects on the labor force available to us, including reduced

employment pools, federal unemployment subsidies and other government regulations, which include laws and regulations related to workers’ health and safety, wage and hour practices, and immigration.

Labor shortages and increased turnover rates within

our team members have led to and could in the future lead to increased costs, such as increased overtime to meet demand and increased wage rates to attract and retain employees and could negatively affect our ability to efficiently operate our

production facilities or otherwise operate at full capacity.

An overall or prolonged labor shortage, lack of skilled labor, increased turnover or labor inflation could have a material adverse impact on our operations, results of operations,

liquidity, or cash flows.

We face intense competition, which could limit our growth opportunities and adversely impact our financial performance.

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performance because of the lower prices, and thus the lower margins, that are required to maintain our competitive position.

A number of different competitive factors outside of our control could impact our ability to compete effectively,

A number of different competitive factors outside of our control could impact our ability to compete effectively, including:

entry of new competitors in our markets;

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A number of our competitors also have greater financial and operational resources, greater brand recognition, longer operating histories, and a broader geographic presence than us.

We remain vulnerable to the

marketing power and high level of customer recognition of these larger competitors and to the risk that these or other competitors could attract our customer base, including, but not limited to, the members of Ollie’s Army.

We remain vulnerable to the marketing

power and high level of customer recognition of these larger competitors and to the risk that these or other competitors could attract our customer base, including, but not limited to, the members of Ollie’s Army.

In addition, if any of our competitors were to consolidate their operations, such consolidation may result in competitors with greatly improved financial resources, improved access to merchandise, greater market

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competitors and changes in the retail markets could result in lost market share and have a material adverse effect on our business, financial condition, and results of operations.

If we fail to open new profitable stores on a timely basis, successfully enter new markets or implement other elements of our long-term

growth strategy, our financial performance could be materially adversely affected.

If we fail to open new profitable stores on a timely basis, successfully enter new markets or implement other elements of our long-term growth strategy, our

financial performance could be materially adversely affected.

Our primary growth strategy is to open new profitable stores and expand our operations into new geographic regions.

We opened 46 new stores in each of 2021 and 2020 as we continue to backfill

in existing markets and expand into contiguous geographies.

We opened 40 and 46 new stores in 2022 and 2021, respectively, as we continue to

backfill in existing markets and expand into contiguous geographies.

Our ability to timely open new stores depends in part on several factors, including the availability of attractive rents and store locations;

the absence of occupancy delays;

to negotiate and enter into leases with acceptable terms;

ability to negotiate and enter into leases with acceptable terms;

our ability to obtain and retain permits and licenses;

our ability to hire and train new personnel, especially store managers, in a cost effective manner;

our ability to adapt and grow our

distribution and other operational and management systems to a changing network of stores;

our ability to adapt and grow

our distribution and other operational and management systems to a changing network of stores;

the availability of capital funding for expansion;

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conditions, customer tastes and discretionary spending patterns than our existing markets.

We may face a higher cost of entry, difficulties attracting labor, alternative customer demands, reduced brand recognition and minimal operating experience

in these areas.

Although we are extremely sensitive to cannibalizing existing stores, opening new stores in our established markets may also result in inadvertent oversaturation, sales volume transfer from existing stores to new stores and

reduced comparable store sales, thus adversely affecting our overall financial performance.

We may not manage our expansion effectively, and our failure to achieve or properly execute our expansion plans could limit our growth or have a material

adverse effect on our business, financial condition and results of operations.

We may not be able to retain the loyalty of our customers, particularly Ollie’s Army members, which could have a material adverse effect

on our business, financial condition and results of operations.

We may face a higher cost of entry, difficulties attracting labor, alternative customer demands, reduced brand recognition and minimal operating experience in

comparable store sales, thus adversely affecting our overall financial performance.

We may not manage our expansion effectively, and our failure to achieve or properly execute our expansion plans could limit our growth or have a material adverse

effect on our business, financial condition, and results of operations.

We may not be able to retain the loyalty of our customers, particularly Ollie’s Army members, which could have a material adverse effect on our business, financial

condition, and results of operations.

We depend on our loyal customer base, particularly members of Ollie’s Army, for our consistent sales and sales growth.

Competition for customers has intensified as competitors have moved into,

or increased their presence in, our geographic markets and from the use of mobile and web-based technology that facilitates online shopping and real-time product and price comparisons.

Competition for customers has intensified as competitors have moved into, or

increased their presence in, our geographic markets and from the use of mobile and web-based technology that facilitates online shopping and real-time product and price comparisons.

We expect this competition to continue to increase.

competitors may be able to offer consumers promotions or loyalty program incentives that could attract Ollie’s Army members or divide their loyalty among several retailers.

If we are unable to retain the loyalty of our customers, our net sales

could decrease and we may not be able to grow our store base as planned, which could have a material adverse effect on our business, financial condition and results of operations.

The failure to timely acquire, develop, open and operate, or the loss of, disruption or interruption in the operations of, our

centralized distribution centers could materially adversely affect our business and operations.

With few exceptions, inventory is shipped directly from suppliers to our distribution centers in York, PA, Commerce, GA, and Lancaster, TX, where the inventory is then processed, sorted and

shipped to our stores.

Our competitors

may be able to offer consumers promotions or loyalty program incentives that could attract our customer base, including members of Ollie’s Army, or divide their loyalty among several retailers.

If we are unable to retain the loyalty of our customers,

our net sales could decrease and we may not be able to grow our store base as planned, which could have a material adverse effect on our business, financial condition, and results of operations.

The failure to timely acquire, develop, open and operate, or the loss of, disruption, or interruption in the operations of, our centralized distribution centers

could materially adversely affect our business and operations.

With few exceptions, inventory is shipped directly from suppliers to our distribution centers in York, PA, Commerce, GA, and Lancaster, TX, where the inventory is then processed, sorted and shipped to

We depend in large part on the orderly operation of this receiving and distribution process, which depends, in turn, on adherence to shipping schedules and effective management of our distribution centers.

transportation costs (including increases in fuel costs), supplier-side delays, reductions in the capacity of carriers, changes in shipping companies, the impact of COVID-19 on our workforce, labor strikes or shortages in the transportation

industry and unexpected delivery interruptions also have the potential to derail our orderly distribution process.

We also may not anticipate changing demands on our distribution system or timely develop and open any necessary additional

In addition, events beyond our control, such as disruptions in operations due to fire or other catastrophic events or labor disagreements, may result in delays in the delivery of merchandise to our stores.

While we maintain business

interruption insurance, in the event our distribution centers are shut down for any reason, such insurance may not be sufficient, and any related insurance proceeds may not be timely paid to us.

In addition, our new store locations receiving

shipments may be further away from our distribution centers, which may increase transportation costs and may create transportation scheduling strains.

Any repeated, intermittent, or long-term disruption in the operations of our distribution

centers would hinder our ability to provide merchandise to our stores and could have a material adverse effect on our business, financial condition and results of operations.

Our new store growth is dependent on our ability to successfully expand our distribution network capacity, and failure to achieve or sustain these plans

could adversely affect our performance.

We maintain distribution centers in York, PA, Commerce, GA and Lancaster, TX to support our existing stores and our growth objectives.

We continuously assess ways to maximize the productivity

and efficiency of our existing distribution facilities and evaluate opportunities for additional distribution centers.

Processing delays or difficulties in operations at our existing distribution centers or any future new distribution centers

could adversely affect our current operations by causing existing stores to have insufficient inventory, and affect future operations by slowing store growth, which could, in turn, reduce sales growth.

In addition, any distribution-related

construction or expansion projects entail risks which could cause delays and cost overruns, such as shortages of materials, shortages of skilled labor or work stoppages, unforeseen construction, scheduling, engineering, environmental or

geological problems, COVID-19 or other strains or types of contagion, weather interference, fires or other casualty losses and unanticipated cost increases.

The completion date and ultimate cost of future projects could differ significantly from

initial expectations due to construction-related or other reasons.

We cannot guarantee that any project will be completed on time or within established budgets.

If we are not successful in managing our inventory balances, it could have a material adverse effect on our business, financial

condition and results of operations.

Our inventory balance represented 53.3% of our total assets exclusive of operating lease right-of-use assets, goodwill and trade name as of January 29, 2022.

Efficient inventory management is

a key component of our profitability and ability to generate revenue.

To be successful, we must maintain sufficient inventory levels and an appropriate product mix to meet our customers’ demands without allowing those levels to increase to such

an extent that the costs to store and hold the goods adversely impact our results of operations.

If our buying decisions do not accurately correspond to customer preferences, if we inappropriately price products or if our expectations about

customer spending levels are inaccurate, we may have to take unanticipated markdowns to dispose of any excess inventory, which could have a material adverse effect on our business, financial condition and results of operations.

We continue to

focus on ways to reduce these risks, but we cannot ensure that we will be successful in our inventory management.

If we are not successful in managing our inventory balances, it could have a material adverse effect on our business, financial

condition and results of operations.

Increases in transportation

costs (including increases in fuel costs), supplier-side delays, reductions in the capacity of carriers, changes in shipping companies, the impact of COVID-19 on our workforce, labor strikes, or shortages in the transportation industry and unexpected

delivery interruptions also have the potential to derail our orderly distribution process.

We also may not anticipate changing demands on our distribution system or timely develop and open any necessary additional facilities.

In addition, events

beyond our control, such as disruptions in operations due to fire or other catastrophic events or labor disagreements, may result in delays in the delivery of merchandise to our stores.

While we maintain business interruption insurance, in the event

our distribution centers are shut down for any reason, such insurance may not be sufficient, and any related insurance proceeds may not be timely paid to us.

In addition, our new store locations receiving shipments may be further away from our

distribution centers, which may increase transportation costs and may create transportation scheduling strains.

Any repeated, intermittent, or long-term disruption in the operations of our distribution centers would hinder our ability to provide

merchandise to our stores and could have a material adverse effect on our business, financial condition, and results of operations.

Our new store growth is dependent on our ability to successfully expand our distribution network capacity, and failure to achieve or sustain these plans could

adversely affect our performance.

We maintain distribution centers in York, PA, Commerce, GA, and Lancaster, TX and are building a fourth in Princeton, IL to support our existing stores and our growth objectives.

We continuously assess

ways to maximize the productivity and efficiency of our existing distribution facilities and evaluate opportunities for additional distribution centers.

Processing delays or difficulties in operations at our existing distribution centers or delays in

opening, processing delays or difficulties in operations at our new distribution centers, including our Princeton, IL distribution center, could adversely affect our current operations by causing existing stores to have insufficient inventory, and

affect future operations by slowing store growth, which could, in turn, reduce sales growth.

In addition, any distribution-related construction or expansion projects entail risks which could cause delays and cost overruns, such as shortages of

materials, shortages of skilled labor or work stoppages, unforeseen construction, scheduling, engineering, environmental or geological problems, COVID-19 or other strains or types of contagion, weather interference, fires or other casualty losses and

unanticipated cost increases.

The completion date and ultimate cost of future projects, including our Princeton, IL distribution center, could differ significantly from initial expectations due to construction-related or other reasons.

guarantee that any project will be completed on time or within established budgets.

If we are not successful in managing our inventory balances, it could have a material adverse effect on our business, financial condition, and results of

Efficient inventory management is a key component of our profitability and ability to generate revenue.

To be successful, we must maintain sufficient inventory levels and an appropriate product mix to

meet our customers’ demands without allowing those levels to increase to such an extent that the costs to store and hold the goods adversely impact our results of operations.

If our buying decisions do not accurately correspond to customer

preferences, if we inappropriately price products or if our expectations about customer spending levels are inaccurate, we may have to take unanticipated markdowns to dispose of any excess inventory, which could have a material adverse effect on our

business, financial condition, and results of operations.

We continue to focus on ways to reduce these risks, but we cannot ensure that we will be successful in our inventory management.

Inventory shrinkage could have a material adverse effect on our business, financial condition and results of operations.

We are subject to the risk of inventory loss and theft.

We cannot ensure that actual rates of inventory loss and theft in the future will be within our estimates or that the measures we are

taking will effectively reduce the problem of inventory shrinkage.

Although some level of inventory shrinkage is an unavoidable cost of doing business, if we were to experience higher rates of inventory shrinkage or incur increased security costs

and other costs to combat inventory theft, it could have a material adverse effect on our business, financial condition and results of operations.

Epidemic or pandemic outbreaks such as COVID-19, natural disasters, whether or not caused by climate change, unusual weather conditions, terrorist acts

and political events could disrupt business and result in lower sales and otherwise adversely affect our financial performance.

The occurrence of one or more natural disasters, such as tornadoes, hurricanes, fires, floods and earthquakes, unusual weather conditions, epidemic outbreaks, terrorist attacks or disruptive

political events in certain regions where our stores are located could adversely affect our business and result in lower sales.

Epidemic or pandemic outbreaks, such as COVID-19, could impact our management and sales associates, our inventory

supply, delivery schedules, our ability to keep our stores open due to mandatory governmental restrictions or may cause our customers to avoid shopping at brick and mortar retailers or reduce the number of trips they will make to our stores.

the extent these events also impact one or more of our key suppliers or result in the closure of one or more of our centralized distribution centers or our corporate headquarters, we may be unable to maintain delivery schedules or provide other

support functions to our stores.

This could have a sustained material adverse effect on our business, financial condition and results of operations.

In addition, severe weather, such as heavy snowfall or extreme temperatures, may discourage or restrict customers in a particular region from traveling to our stores, thereby reducing our sales

and profitability.

If severe weather conditions occur during the second or fourth quarter of our fiscal year, the adverse impact to our sales and profitability could be even greater than at other times during the year because we generate a larger

portion of our sales and profits during these periods.

Natural disasters, which may include tornadoes, hurricanes, floods and earthquakes, may impact our store locations or other operations.

In addition, climate change may have an impact on the

frequency and/or severity of such natural disasters.

We have a growing number of store locations in areas that may be impacted by weather events and natural disasters such as the types listed above.

To the extent that such weather events or

natural disasters may damage our stores or other operations, we may be unable to operate stores or other facilitates and our consolidated financial results may be materially adversely affected.

Fluctuations in comparable store sales and results of operations, including fluctuations on a quarterly basis, could cause our business performance to

decline substantially.

Our results of operations have fluctuated in the past, including on a quarterly basis, and can be expected to continue to fluctuate in the future.

Our comparable store sales and results of operations are affected by a variety of factors, including:

national and regional economic trends in the United States;

challenges and the impact of COVID-19 and related regulations;

changes in gasoline prices;

changes in our merchandise mix;

changes in pricing;

changes in the timing of promotional and advertising efforts;

holidays or seasonal periods.

results of operations.

We cannot ensure that actual rates of inventory loss and theft in the future will be within our estimates or that the measures we are taking will

effectively reduce the problem of inventory shrinkage.

Although some level of inventory shrinkage is an unavoidable cost of doing business, if we were to experience higher rates of inventory shrinkage or incur increased security costs and other costs

to combat inventory theft, it could have a material adverse effect on our business, financial condition, and results of operations.

Our success depends on our executive officers, our merchant team and other key personnel.

If we lose key personnel or are unable to hire additional

qualified personnel, it could have a material adverse effect on our business, financial condition and results of operations.

If we lose key personnel or are unable to hire additional qualified personnel, it could have a

material adverse effect on our business, financial condition and results of operations.

Our future success depends to a significant degree on the skills, experience and efforts of our executive officers, our merchant team and other key personnel.

The unexpected loss of services of

any of our executive officers or senior members of our merchant team could materially adversely affect our business and operations.

Competition for skilled and experienced management in the retail industry is intense, and our future success will

also depend on our ability to attract and retain qualified personnel, including our merchant team, which is responsible for purchasing and negotiating the terms of our merchandise.

Failure to attract and retain new qualified personnel could have

a material adverse effect on our business, financial condition and results of operations.

If we are unable to attract, train and retain highly qualified managerial personnel and sales associates in our stores and our distribution centers, our

sales, financial performance and business operations may be materially adversely affected.

The unexpected loss of services of any of

our executive officers or senior members of our merchant team could materially adversely affect our business and operations.

Competition for skilled and experienced management in the retail industry is intense, and our future success will also depend

on our ability to attract and retain qualified personnel, including our merchant team, which is responsible for purchasing and negotiating the terms of our merchandise.

Failure to attract and retain new qualified personnel could have a material

adverse effect on our business, financial condition, and results of operations.

If we are unable to attract, train, and retain highly qualified managerial personnel and sales associates in our stores and our distribution centers, our sales, financial

performance, and business operations may be materially adversely affected.

We focus on providing our customers with a memorable and engaging shopping experience.

To grow our operations and meet the needs and expectations of our customers, we must attract, train and retain a large number

of highly qualified store management personnel and sales associates, while controlling labor costs.

Our ability to control labor costs is subject to numerous external factors and compliance with regulatory structures, including competition for

and availability of qualified personnel in a given market, unemployment levels within those markets, governmental regulatory bodies such as the Equal Employment Opportunity Commission and the National Labor Relations Board, prevailing wage rates

and wage and hour laws, minimum wage laws, the impact of legislation governing labor and employee relations or benefits, such as the Affordable Care Act, health insurance costs and our ability to maintain good relations with our associates.

compete with other retail businesses for many of our store management personnel and sales associates in hourly and part-time positions.

These positions have had historically high turnover rates, which can lead to increased training and retention

We also rely on associates in our distribution centers to ensure the efficient processing and delivery of products from our suppliers to our stores.

If we are unable to attract and retain quality associates, and other management personnel,

or fail to comply with the regulations and laws impacting personnel, it could have a material adverse effect on our business, financial condition and results of operations.

To grow our operations and meet the needs and expectations of our customers, we must attract, train, and retain a large number of

highly qualified store management personnel and sales associates, while controlling labor costs.

Our ability to control labor costs is subject to numerous external factors and compliance with regulatory structures, including competition for and

availability of qualified personnel in a given market, unemployment levels within those markets, governmental regulatory bodies such as the Equal Employment Opportunity Commission (“EEOC”) and the National Labor Relations Board (“NLRB”), prevailing

wage rates and wage and hour laws, minimum wage laws, the impact of legislation governing labor and employee relations or benefits, such as the Affordable Care Act (“ACA”), health insurance costs, healthcare costs, including those related to COVID-19

or other potential pandemics or disease outbreaks and related testing and vaccination costs, and our ability to maintain good relations with our associates.

We compete with other retail businesses for many of our store management personnel and sales

associates in hourly and part-time positions.

These positions have had historically high turnover rates, which can lead to increased training and retention costs.

We also rely on associates in our distribution centers to ensure the efficient

processing and delivery of products from our suppliers to our stores.

If we are unable to attract and retain quality associates, and other management personnel, fail to comply with the regulations and laws impacting personnel, or have difficulty

accurately predicting employee-related costs, including healthcare costs, and establishing accurate budgetary reserves for such costs, it could have a material adverse effect on our business, financial condition, and results of operations.

Our success depends on our marketing, advertising, and promotional efforts.

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We use marketing and promotional programs to attract customers to our stores and to encourage purchases by our customers.

Although we use various media for our promotional efforts, including

regular and Ollie’s Army mailers, email campaigns, radio and television advertisements and sports marketing, we primarily advertise our in-store offerings through printed flyers.

In 2021, approximately 63% of our advertising spend was for the

printing and distribution of flyers.

If the efficacy of printed flyers as an advertising medium declines, or if we fail to successfully develop and implement new marketing, advertising and promotional strategies, such as an effective social media

strategy, our competitors may be able to attract the interest of our customers, which could reduce customer traffic in our stores.

Changes in the amount and degree of promotional intensity or merchandising strategy by our competitors could cause

us to have difficulties in retaining existing customers and attracting new customers.

If the efficacy of our marketing or promotional activities declines or if such activities of our competitors are more effective than ours, or if for any other

reason we lose the loyalty of our customers, including our Ollie’s Army members, it could have a material adverse effect on our business, financial condition and results of operations.

Because our business is seasonal, with the highest volume of net sales during the holiday season, adverse events during our fourth fiscal quarter could

materially adversely affect our business, operations, cash flows and financial condition.

Although we use various media for our promotional efforts, including regular and

Ollie’s Army mailers, email campaigns, radio and television advertisements and sports marketing, we primarily advertise our in-store offerings through printed flyers.

In 2022, over 60% of our advertising spend was for the printing and distribution of

able to attract the interest of our customers, which could reduce customer traffic in our stores.

Changes in the amount and degree of promotional intensity or merchandising strategy by our competitors could cause us to have difficulties in retaining

existing customers and attracting new customers.

If the efficacy of our marketing or promotional activities declines or if such activities of our competitors are more effective than ours, or if for any other reason we lose the loyalty of our

customers, including our Ollie’s Army members, it could have a material adverse effect on our business, financial condition, and results of operations.

Because our business is seasonal, with the highest volume of net sales during the holiday season, adverse events during our fourth fiscal quarter could materially

adversely affect our business, operations, cash flows, and financial condition.

We generally recognize our highest volume of net sales in connection with the holiday sales season, which occurs in the fourth quarter of our fiscal year.

In anticipation of the holiday sales

season, we purchase substantial amounts of seasonal inventory and hire many part-time associates.

Because a significant percentage of our net sales and operating income are generated in our fourth fiscal quarter, we have limited ability to

compensate for shortfalls in our fourth fiscal quarter sales or earnings by changing our operations or strategies in other fiscal quarters.

Adverse events, such as deteriorating economic conditions, higher unemployment, higher gas prices, public

transportation disruptions, errors in anticipating consumer demand for our products, or unanticipated adverse or unseasonable weather conditions could result in lower than planned sales during the holiday sales season.

If our fourth fiscal

quarter sales results were substantially below expectations, we would realize less cash flows from operations, and may be forced to mark down our merchandise, especially our seasonal merchandise, which could have a material adverse effect on our

business, financial condition and results of operations.

Our business requires that we lease substantial amounts of space and there can be no assurance that we will be able to continue to lease space on terms as favorable as the

leases negotiated in the past.

In anticipation of the holiday sales season, we

purchase substantial amounts of seasonal inventory and hire many part-time associates.

Because a significant percentage of our net sales and operating income are generated in our fourth fiscal quarter, we have limited ability to compensate for

shortfalls in our fourth fiscal quarter sales or earnings by changing our operations or strategies in other fiscal quarters.

Adverse events, such as deteriorating economic conditions, higher unemployment, higher gas prices, public transportation

disruptions, errors in anticipating consumer demand for our products, or unanticipated adverse or unseasonable weather conditions could result in lower than planned sales during the holiday sales season.

If our fourth fiscal quarter sales results

were substantially below expectations, we would realize less cash flows from operations, and may be forced to mark down our merchandise, especially our seasonal merchandise, which could have a material adverse effect on our business, financial

condition, and results of operations.

Our business requires that we lease substantial amounts of space and there can be no assurance that we will be able to continue to lease space on terms as favorable as the leases

negotiated in the past.

We lease the majority of our store locations, our corporate headquarters and our distribution facilities in York, PA and Commerce, GA.

Our stores are leased from third parties, with typical initial lease terms of

approximately seven years with options to renew for three to five successive five-year periods.

We believe that we have been able to negotiate favorable rental rates over the last few years due in large part to the general state of the economy,

the increased availability of vacant big box retail sites and our careful identification of favorable lease opportunities.

While we will continue to seek out advantageous lease opportunities, there is no guarantee that we will continue to be able

to find low-cost second generation sites or obtain favorable lease terms.

approximately seven years with options to renew for successive five-year periods.

We believe that we have been able to negotiate favorable rental rates over the last few years due in large part to the general state of the economy, the increased

availability of vacant big box retail sites, and our careful identification of favorable lease opportunities.

While we will continue to seek out advantageous lease opportunities, there is no guarantee that we will continue to be able to find low-cost

second generation sites or obtain favorable lease terms.

Many of our lease agreements have defined escalating rent provisions over the initial term and any extensions.

Increases in our occupancy costs and difficulty in

identifying economically suitable new store locations could have significant negative consequences, which include:

Increases in our occupancy costs and difficulty in identifying economically

suitable new store locations could have significant negative consequences, which include:

requiring that a greater portion of our available cash be applied to pay our rental obligations, thus reducing cash available for other purposes and reducing profitability;

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We depend on cash flows from operations to pay our lease expenses and to fulfill our other cash needs.

If our business does not generate sufficient cash flows from operating activities to fund these expenses and

needs and sufficient funds are not otherwise available to us, we may not be able to service our lease expenses, grow our business, respond to competitive challenges or fund our other liquidity and capital needs, which could harm our business.

Additional sites that we lease may be subject to long-term non-cancelable leases if we are unable to negotiate our current standard lease terms.

If an existing or future store is not profitable, and we decide to close it, we may nonetheless be

committed to perform our obligations under the applicable lease including, among other things, paying the base rent for the balance of the lease term.

Moreover, even if a lease has an early cancellation clause, we may not satisfy the contractual

requirements for early cancellation under that lease.

In addition, if we are not able to enter into new leases or renew existing leases on terms acceptable to us, this could have a material adverse effect on our business, financial condition and

results of operations.

If our business does not generate sufficient cash flows from operating activities to fund these expenses and needs

and sufficient funds are not otherwise available to us, we may not be able to service our lease expenses, grow our business, respond to competitive challenges, or fund our other liquidity and capital needs, which could harm our business.

sites that we lease may be subject to long-term non-cancelable leases if we are unable to negotiate our current standard lease terms.

If an existing or future store is not profitable, and we decide to close it, we may nonetheless be committed to

perform our obligations under the applicable lease including, among other things, paying the base rent for the balance of the lease term.

Moreover, even if a lease has an early cancellation clause, we may not satisfy the contractual requirements for

early cancellation under that lease.

In addition, if we are not able to enter into new leases or renew existing leases on terms acceptable to us, this could have a material adverse effect on our business, financial condition, and results of

Risks associated with the current geopolitical climate could adversely affect our business, financial condition, and results of operations.

Our business, financial condition and results of operations may differ materially as we cannot predict the impact of the Russian invasion of Ukraine that has occurred and any heightened geopolitical instability or

results that may follow.

Risks associated with heightened geopolitical instability as a result of the Russia/Ukraine conflict include, among others, reductions in consumer confidence, heightened inflation, production disruptions, cyber

disruptions or attacks, higher natural gas costs, higher manufacturing costs and higher supply chain costs.

Our business, financial condition and results of operations may differ materially as we cannot predict the impact of the current geopolitical climate.

Risks associated with heightened geopolitical instability include,

among others, reductions in consumer confidence, heightened inflation, production disruptions, cyber disruptions or attacks, higher natural gas costs, higher manufacturing costs, and higher supply chain costs.

Climate change may have a long-term impact on our business.

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disasters and adverse weather, such as drought, wildfires, storms, sea-level rise, and flooding, occurring more frequently or with greater intensity.

These events and their impacts could otherwise disrupt and adversely affect our business and

could materially affect our financial condition and results of operations.

These events and their impacts could otherwise disrupt and adversely affect our business and could

materially affect our financial condition and results of operations.

Natural disasters, whether or not caused by climate change, epidemic or pandemic outbreaks, such as COVID-19, unusual weather conditions, terrorist acts and

political events could disrupt our business and result in lower sales and otherwise adversely affect our financial performance.

The occurrence of one or more natural disasters, such as tornadoes, hurricanes, fires, floods and earthquakes, epidemic outbreaks, unusual weather conditions, terrorist attacks or disruptive political

events in certain regions where our stores are located could adversely affect our business and result in lower sales.

Epidemic or pandemic outbreaks, such as COVID-19, could impact our management and sales associates, our inventory supply, delivery

schedules, our ability to keep our stores open due to mandatory governmental restrictions or may cause our customers to avoid shopping at brick and mortar retailers or reduce the number of trips they will make to our stores.

To the extent these

events also impact one or more of our key suppliers or result in the closure of one or more of our centralized distribution centers or our corporate headquarters, we may be unable to maintain delivery schedules or provide other support functions to

In addition, severe weather, such as heavy snowfall or extreme temperatures, may discourage or restrict customers in a particular region from traveling to our stores, thereby reducing our sales and profitability.

If severe weather

conditions occur during the second or fourth quarter of our fiscal year, the adverse impact to our sales and profitability could be even greater than at other times during the year because we generate a larger portion of our sales and profits during

these periods.

Natural disasters, which may include tornadoes, hurricanes, floods, and earthquakes, may impact our store locations or other operations.

In addition, climate change may have an impact on the frequency and/or severity of such natural

We have a growing number of store locations in areas that may be impacted by weather events and natural disasters such as the types listed above.

To the extent that such weather events or natural disasters may damage our stores or other

operations, we may be unable to operate stores or other facilitates and our consolidated financial results may be materially adversely affected.

This could have a sustained material adverse effect on our business, financial condition and results of

LEGAL AND REGULATORY

We are subject to governmental regulations, procedures, and requirements.

A significant change in, or noncompliance with, these

regulations could have a material adverse effect on our business, financial condition and results of operations.

A significant change in, or noncompliance with, these regulations could have a material

adverse effect on our business, financial condition, and results of operations.

We routinely incur significant costs in complying with federal, state and local laws, and regulations.

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New laws or regulations, including those dealing with healthcare reform, product safety, consumer credit, privacy and

information security and labor and employment, among others, or changes in existing federal, state and local laws and regulations, particularly those governing the sale of products and food safety and quality (including changes in labeling or

disclosure requirements), federal or state wage requirements, employee rights, health care, social welfare or entitlement programs such as health insurance, paid leave programs, other changes in workplace regulation, and compliance with laws

regarding public access to our stores, may result in significant added expenses or may require extensive system and operating changes that may be difficult to implement and/or could materially increase our cost of doing business.

compliance or noncompliance with applicable laws or regulations or untimely or incomplete execution of a required product recall can result in the imposition of penalties, including loss of licenses or significant fines or monetary penalties,

class action litigation or other litigation, in addition to reputational damage.

Additionally, changes in tax laws, the interpretation of existing laws, or our failure to sustain our reporting positions on examination could materially adversely

affect our effective tax rate and could have a material adverse effect on our business, financial condition and results of operations.

information security, the environment and labor and employment, among others, or changes in existing federal, state and local laws and regulations, particularly those governing the sale of products and food safety and quality (including changes in

labeling or disclosure requirements), federal or state wage requirements, employee rights, health care, social welfare or entitlement programs such as health insurance, paid leave programs, other changes in workplace regulation, and compliance with

laws regarding public access to our stores, may result in significant added expenses or may require extensive system and operating changes that may be difficult to implement and/or could materially increase our cost of doing business.

action litigation or other litigation, in addition to reputational damage.

Additionally, changes in tax laws, the interpretation of existing laws, or our failure to sustain our reporting positions on examination could materially adversely affect our

effective tax rate and could have a material adverse effect on our business, financial condition, and results of operations.

If we fail to protect our brand names, competitors may adopt trade names that dilute the value of these assets.

We may be unable or unwilling to strictly enforce our trademarks in each jurisdiction in which we do business.

Also, we may not always be able to successfully enforce our trademarks against

competitors or against challenges by others.

Our failure to successfully protect our trademarks could diminish the value and efficacy of our brand recognition and could cause customer confusion, which could have a material adverse effect on our

business, financial condition and results of operations.

We rely on manufacturers in foreign countries for merchandise and a significant amount of our domestically-purchased merchandise is

manufactured abroad.

Our business may be materially adversely affected by risks associated with international trade.

Also, we may not always be able to successfully enforce our trademarks against competitors

or against challenges by others.

Our failure to successfully protect our trademarks could diminish the value and efficacy of our brand recognition and could cause customer confusion, which could have a material adverse effect on our business,

financial condition, and results of operations.

We rely on manufacturers in foreign countries for merchandise and a significant amount of our domestically-purchased merchandise is manufactured abroad.

business may be materially adversely affected by risks associated with international trade.

We purchase merchandise directly from suppliers outside of the United States.

In 2022, substantially all of our private label inventory purchases were direct imports.

Additionally, a

significant amount of our domestically-purchased merchandise is manufactured abroad.

Our ability to identify qualified suppliers and to access products in a timely and efficient manner is a significant challenge, especially with respect to goods

sourced outside of North America.

Additionally, a significant amount

of our domestically-purchased merchandise is manufactured abroad.

Our ability to identify qualified suppliers and to access products in a timely and efficient manner is a significant challenge, especially with respect to goods sourced outside of

North America.

Global sourcing and foreign trade involve numerous factors and uncertainties beyond our control, including possible changes to U.S.

trade policy, including potential changes in response to the widespread outbreak

of COVID-19 (coronavirus), increased shipping costs, the timing of shipments, increased import duties, more restrictive quotas, loss of most favored nation trading status, currency, work stoppages, transportation delays, port of entry issues,

economic uncertainties such as inflation, foreign government regulations, political unrest, natural disasters, war, terrorism, trade restrictions, political instability, the financial stability of vendors, merchandise quality issues, unexpected

contagion, existing viruses or illnesses, and tariffs.

Moreover, negative press or reports about internationally manufactured products may sway public opinion, and thus customer confidence, away from the products sold in our stores.

other issues affecting our international vendors could have a material adverse effect on our business, financial condition and results of operations.

The cost of compliance with product safety regulations and risks related to product liability claims and product recalls could damage our reputation,

increase our cost of doing business and could have a material adverse effect on our business, financial condition and results of operations.

trade policy, increased shipping costs, the timing of shipments, increased import duties, more

restrictive quotas, loss of most favored nation trading status, currency, work stoppages, transportation delays, port of entry issues, economic uncertainties such as inflation, foreign government regulations, political unrest, natural disasters, war,

terrorism, trade restrictions, political instability, the financial stability of vendors, merchandise quality issues, unexpected contagion, existing viruses or illnesses, and tariffs.

Moreover, negative press or reports about internationally

manufactured products may sway public opinion, and thus customer confidence, away from the products sold in our stores.

These and other issues affecting our international vendors could have a material adverse effect on our business, financial

condition, and results of operations.

The cost of compliance with product safety regulations and risks related to product liability claims and product recalls could damage our reputation, increase our

cost of doing business and could have a material adverse effect on our business, financial condition, and results of operations.

New federal or state legislation, including new product safety laws and regulations, may negatively impact our operations.

Future changes in product safety legislation or regulations may lead

to product recalls and the disposal or write-off of merchandise.

While we work to comply in all material respects with applicable legislation and regulations, and to execute product recalls in a timely manner, if our merchandise, including food

and consumable products and flooring, does not meet applicable governmental safety standards or our customers’ expectations regarding quality or safety, we could experience lost sales and increased costs, be exposed to legal and reputational risk

and face fines or penalties which could materially adversely affect our financial results.

Future changes in product safety legislation or regulations may lead to product

recalls and the disposal or write-off of merchandise.

While we work to comply in all material respects with applicable legislation and regulations, and to execute product recalls in a timely manner, if our merchandise, including food and consumable

products and flooring, does not meet applicable governmental safety standards or our customers’ expectations regarding quality or safety, we could experience lost sales and increased costs, be exposed to legal and reputational risk and face fines or

penalties which could materially adversely affect our financial results.

We also purchase a material portion of our products on a closeout basis.

Some of these products are obtained through brokers or intermediaries rather than

through manufacturers.

Some of these products are obtained through brokers or intermediaries rather than through manufacturers.

The closeout nature of a portion of our products sometimes makes it more difficult for us to investigate all aspects of these products.

Furthermore, customers have asserted claims, and may in the future assert claims, that

they have sustained injuries from merchandise offered by us, and we may be subject to lawsuits relating to these claims.

Furthermore, customers have asserted claims, and may in the future assert claims, that they have sustained

injuries from merchandise offered by us, and we may be subject to lawsuits relating to these claims.

There is a risk that these claims may exceed, or fall outside the scope of, our insurance coverage.

Even with adequate

insurance and indemnification from third-party suppliers, such claims, even if unsuccessful or not fully pursued, could significantly damage our reputation and customer confidence in our products.

If this occurs, it may be difficult for us to

regain lost sales, which could have a material adverse effect on our business, financial condition and results of operations.

Even with adequate insurance and indemnification

from third-party suppliers, such claims, even if unsuccessful or not fully pursued, could significantly damage our reputation and customer confidence in our products.

If this occurs, it may be difficult for us to regain lost sales, which could have a

material adverse effect on our business, financial condition, and results of operations.

Our current insurance program may expose us to unexpected costs and negatively affect our financial performance.

Our insurance coverage reflects deductibles, self-insured retentions, limits of liability and similar provisions that we believe are prudent based on the nature of our operations.

there are types of losses we may incur but against which we cannot be insured or which we believe are not economically reasonable to insure, such as losses due to acts of war, employee and certain other crime, wage and hour, and certain other

However, there are

types of losses we may incur but against which we cannot be insured or which we believe are not economically reasonable to insure, such as losses due to acts of war, employee and certain other crime, wage and hour, and certain other

employment-related claims, public accommodation claims, class actions, and some natural disasters.

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Unanticipated changes in any applicable

actuarial assumptions and management estimates underlying our recorded liabilities for these losses, including expected increases in medical and indemnity costs, could result in materially different expenses than expected under these programs,

which could have a material adverse effect on our results of operations and financial condition.

could have a material adverse effect on our results of operations and financial condition.

We continue to maintain property insurance for catastrophic events at our store support center, distribution centers, and stores.

because of ongoing changes in healthcare law, among other things, we may experience an increase in participation in our group health insurance programs, which may lead to a greater number of medical and related claims.

While we have coverage for

some cyber-related incidents, the nature and scope of any potential attack or breach may result in substantial costs that would exceed the scope of coverage or limits of coverage.

If we experience a greater number of these losses than we

anticipate, it could have a material adverse effect on our business, financial condition and results of operations.

In addition, because of

ongoing changes in healthcare law, among other things, we may experience an increase in participation in our group health insurance programs, which may lead to a greater number of medical and related claims.

While we have coverage for some

cyber-related incidents, the nature and scope of any potential attack or breach may result in substantial costs that would exceed the scope of coverage or limits of coverage.

If we experience a greater number of these losses than we anticipate, it

could have a material adverse effect on our business, financial condition, and results of operations.

We face litigation risks from customers, associates, suppliers, stockholders and other third parties in the ordinary course of business.

Our business is subject to the risk of litigation by customers, current and former associates, suppliers, stockholders, intellectual property rights holders, government agencies and others

through private actions, class actions, collective actions, administrative proceedings, regulatory actions, or other litigation.

From time to time, such lawsuits are filed against us and the outcome of any litigation, particularly class or

collective action lawsuits and regulatory actions, is difficult to assess or quantify.

Plaintiffs in these types of lawsuits may seek recovery of very large or indeterminate amounts, and the magnitude of the potential loss relating to such

lawsuits may remain unknown for substantial periods of time.

Our business is subject to the risk of litigation by customers, current and former associates, suppliers, stockholders, intellectual property rights holders, government agencies, and others through

private actions, class actions, collective actions, administrative proceedings, regulatory actions, or other litigation.

From time to time, such lawsuits are filed against us and the outcome of any litigation, particularly class or collective action

lawsuits and regulatory actions, is difficult to assess or quantify.

Plaintiffs in these types of lawsuits may seek recovery of very large or indeterminate amounts, and the magnitude of the potential loss relating to such lawsuits may remain unknown

for substantial periods of time.

The cost to defend any such lawsuits may be significant and may negatively affect our operating results if changes to our business operations are required.

There may also be negative

publicity associated with litigation that could decrease customer acceptance of merchandise offerings, regardless of whether the allegations are valid or whether we are ultimately found liable.

As a result, litigation may adversely affect our

business, financial condition, results of operations or liquidity.

There may also be negative publicity associated with

litigation that could decrease customer acceptance of merchandise offerings, regardless of whether the allegations are valid or whether we are ultimately found liable.

As a result, litigation may adversely affect our business, financial condition,

results of operations, or liquidity.

TECHNOLOGY AND CYBERSECURITY

Any disruptions to our information technology systems or breaches of our network security could disrupt or interrupt our operations,

compromise our reputation, expose us to litigation, government enforcement actions and costly response measures and could have a material adverse effect on our business, financial condition and results of operations.

We rely on the integrity, security and successful functioning of our information technology systems and network infrastructure across our operations, including point-of-sale processing at our

In connection with sales, we transmit encrypted confidential credit and debit card information.

As of the end of 2021, we are compliant with the Payment Card Industry Data Security Standard (“PCI”) issued by the Payment Card Industry Security Standards Council.

However, there can be no

assurance that in the future we will be able to operate our facilities and our customer service and sales operations in accordance with PCI or other industry recommended or contractually required practices.

We expect to incur additional expenses,

and the time and effort of our information technology staff, to maintain PCI compliance.

Any disruptions to our information technology systems or breaches of our network security could disrupt or interrupt our operations, compromise our reputation,

expose us to litigation, government enforcement actions and costly response measures and could have a material adverse effect on our business, financial condition, and results of operations.

We rely on the integrity, security and successful functioning of our information technology systems and network infrastructure across our operations, including point-of-sale processing at our stores.

connection with sales, we transmit encrypted confidential credit and debit card information.

We are compliant with the Payment Card Industry Data Security Standard (“PCI”) issued by the Payment Card Industry Security Standards Council.

However, there can be no assurance that in the future we

will be able to operate our facilities and our customer service and sales operations in accordance with PCI or other industry recommended or contractually required practices.

We expect to incur additional expenses, and the time and effort of our

information technology staff, to maintain PCI compliance.

Even though we are compliant with such standards, we still may not be able to prevent or timely detect security breaches.

An increasingly significant portion of our sales depends on the continuing operation of our information technology and communications systems, including, but not limited to, our point-of-sale

system and our credit card processing systems.

Our information technology, communications systems and electronic data may be vulnerable to damage or interruption from computer viruses, ransomware attacks, loss of data, unauthorized data breaches,

usage errors by our associates or our contractors or other attempts to harm our systems, including cyber-security attacks or other breaches of cardholder data, earthquakes, acts of war or terrorist attacks, floods, fires, tornadoes, hurricanes,

power loss and outages, computer and telecommunications failures.

An increasingly significant portion of our sales depends on the continuing operation of our information technology and communications systems, including, but not limited to, our point-of-sale system and

our credit card processing systems.

Our information technology, communications systems, and electronic data may be vulnerable to damage or interruption from computer viruses, ransomware attacks, loss of data, unauthorized data breaches, usage errors

by our associates or our contractors or other attempts to harm our systems, including cyber-security attacks or other breaches of cardholder data, earthquakes, acts of war or terrorist attacks, floods, fires, tornadoes, hurricanes, power loss and

outages, computer, and telecommunications failures.

Some of our systems are not fully redundant, and our disaster recovery planning cannot account for all eventualities.

The occurrence of intentional sabotage, unauthorized access,

natural disaster, or other unanticipated problems could result in lengthy interruptions in our service.

Any errors or vulnerabilities in our systems, or damage to or failure of our systems, could result in interruptions in our services,

non-compliance with certain regulations, substantial remediation costs, and liability for lost or stolen information, any of which could have a material adverse effect on our business, financial condition and results of operations.

Data protection requirements increase our operating costs and a breach in information privacy or other related risks could negatively

impact our operations.

The occurrence of intentional sabotage, unauthorized access, natural disaster,

or other unanticipated problems could result in lengthy interruptions in our service.

Any errors or vulnerabilities in our systems, or damage to or failure of our systems, could result in interruptions in our services, non-compliance with certain

regulations, substantial remediation costs, and liability for lost or stolen information, any of which could have a material adverse effect on our business, financial condition, and results of operations.

Data protection requirements increase our operating costs and a breach in information privacy or other related risks could negatively impact our operations.

We have access to, collect or maintain private or confidential information regarding our customers, associates and suppliers, as well as our business.

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countries, with the frequent imposition of new and changing requirements across the many states in which we conduct our business.

For example, the European Union’s General Data Protection Regulation (“GDPR”) expands the scope of EU data

protection law to all foreign companies processing personal data of EU residents and imposes a strict data protection compliance regime with significant monetary penalties.

The state of California passed the California Consumer Privacy Act of

2018 (“CCPA”), which went into effect on January 1, 2020.

The CCPA and other state privacy acts have imposed and likely will impose additional data protection obligations on companies considered to be doing business in California and provides for

substantial fines for non-compliance and, in some cases, a private right of action to consumers who are victims of data breaches.

Complying with the GDPR, the CCPA and similar emerging and changing privacy, data protection and information

security requirements may cause us to incur substantial costs or compliance risks due to, among other things, system changes and the development of new processes and business initiatives.

Our failure to comply with privacy, data protection and

information security laws could result in potentially significant regulatory and/or governmental investigations and/or actions, litigation, fines, sanctions, ongoing regulatory monitoring and customer attrition.

The California Consumer Privacy Act of 2018 (“CCPA”) and other state privacy acts have imposed and likely will impose

additional data protection obligations on companies considered to be doing business in California and provides for substantial fines for non-compliance and, in some cases, a private right of action to consumers who are victims of data breaches.

Complying with the CCPA and similar emerging and changing privacy, data protection and information security requirements may cause us to incur substantial costs or compliance risks due to, among other things, system changes and the development of new

processes and business initiatives.

Our failure to comply with privacy, data protection and information security laws could result in potentially significant regulatory and/or governmental investigations and/or actions, litigation, fines, sanctions,

ongoing regulatory monitoring, and customer attrition.

In addition, our customers have a high expectation that we will adequately protect their personal information from cyber-attack or other security breaches.

We have procedures in place to

evaluate the integrity of our systems, and to safeguard such data and information.

However, the landscape is evolving at a rapid pace, and we may be unable to effectively anticipate or respond to attacks to or breaches of our security systems or

implement adequate preventative measures.

A breach of customer, employee, supplier, or company data could attract a substantial amount of negative media attention, damage our customer and supplier relationships and our reputation, and result in

lost sales, costly fines, other expenses and/or lawsuits, any of which could have a material adverse effect on our business, financial condition and results of operations.

If we are unable to maintain or upgrade our information technology systems or if we are unable to convert to alternate systems in an

efficient and timely manner, our operations may be disrupted or become less efficient.

We have procedures in place to evaluate the

integrity of our systems, and to safeguard such data and information.

However, the landscape is evolving at a rapid pace, and we may be unable to effectively anticipate or respond to attacks to or breaches of our security systems or implement

adequate preventative measures.

costly fines, other expenses and/or lawsuits, any of which could have a material adverse effect on our business, financial condition and results of operations.

If we are unable to maintain or upgrade our information technology systems or if we are unable to convert to alternate systems in an efficient and timely manner,

our operations may be disrupted or become less efficient.

We depend on a variety of information technology systems for the efficient functioning of our business.

We rely on certain hardware, telecommunications and software vendors to maintain and

periodically upgrade many of these systems so that we can continue to support our business.

We rely on certain hardware, telecommunications and software vendors to maintain and periodically

upgrade many of these systems so that we can continue to support our business.

Various components of our information technology systems, including hardware, networks and software, are licensed to us by third party vendors.

extensively on our information technology systems to process transactions, summarize results and manage our business.

We are in compliance with PCI as of the end of 2021, and compliance with PCI and implementing related procedures, technology and

information security measures requires significant resources and ongoing attention.

Costs and potential problems and interruptions associated with the implementation of new or upgraded systems and technology such as those necessary to achieve

compliance with PCI or with maintenance or adequate support of existing systems could also disrupt or reduce the efficiency of our operations.

Any material interruptions or failures in our payment-related systems could have a material adverse

effect on our business, financial condition and results of operations.

We rely extensively on our

information technology systems to process transactions, summarize results, and manage our business.

We are in compliance with PCI, and compliance with PCI and implementing related procedures, technology and information security measures requires

significant resources and ongoing attention.

Costs and potential problems and interruptions associated with the implementation of new or upgraded systems and technology such as those necessary to achieve compliance with PCI or with maintenance or

adequate support of existing systems could also disrupt or reduce the efficiency of our operations.

Any material interruptions or failures in our payment-related systems could have a material adverse effect on our business, financial condition, and

results of operations.

If our information technology systems are damaged or cease to function properly, we may have to make a significant investment to fix or replace them.

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re-compliance could also be substantial and we may suffer loss of critical data and interruptions or delays in our operations as a result.

In addition, we may have to upgrade our existing information technology systems from time to time in order

for such systems to withstand the increasing needs of our expanding business.

In addition, we may have to upgrade our existing information technology systems from time to time in order for

such systems to withstand the increasing needs of our expanding business.

Any material interruption experienced by our information technology systems could have a material adverse effect on our business, financial condition, and results of

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ACCOUNTING AND FINANCIAL

If our estimates or judgments relating to our significant accounting policies prove to be incorrect, our operating results could be

adversely affected.

If our estimates or judgments relating to our significant accounting policies prove to be incorrect, our operating results could be adversely affected.

The preparation of financial statements in conformity with U.S.

Generally Accepted Accounting Principles (“GAAP”) requires management to make estimates and assumptions that affect the amounts

reported in the accompanying consolidated financial statements and notes.

Generally Accepted Accounting Principles (“GAAP”) requires management to make estimates and assumptions that affect the amounts reported

in the accompanying consolidated financial statements and notes.

We base our estimates on historical experience and on various other assumptions that we believe to be reasonable under the circumstances.

The results of these estimates

form the basis for making judgments about the carrying values of assets, liabilities and equity, and the amount of revenue and expenses that are not readily apparent from other sources.

Our operating results may be adversely affected if our

assumptions change or if actual circumstances differ from those in our assumptions, which could cause our operating results to fall below the expectations of securities analysts and investors, resulting in a decline in our stock price.

Changes to accounting rules or regulations could have a material adverse effect on our business, financial condition and results of

The results of these estimates form the basis

for making judgments about the carrying values of assets, liabilities and equity, and the amount of revenue and expenses that are not readily apparent from other sources.

Our operating results may be adversely affected if our assumptions change or if

actual circumstances differ from those in our assumptions, which could cause our operating results to fall below the expectations of securities analysts and investors, resulting in a decline in our stock price.

Changes to accounting rules or regulations could have a material adverse effect on our business, financial condition, and results of operations.

Changes to existing accounting rules or regulations may impact our future results of operations or cause the perception that we are more highly leveraged.

Other new accounting rules or

regulations and varying interpretations of existing accounting rules or regulations have occurred and may occur in the future.

Future changes to accounting rules or regulations could have a material adverse effect on our business, financial

condition and results of operations.

Other new accounting rules or regulations and

varying interpretations of existing accounting rules or regulations have occurred and may occur in the future.

Future changes to accounting rules or regulations could have a material adverse effect on our business, financial condition, and results of

RISKS RELATED TO COMMON STOCK AND CORPORATE GOVERNANCE

As a public company, our management is required to devote substantial time to compliance initiatives.

The Sarbanes-Oxley Act and rules implemented by the SEC and the NASDAQ Stock Market LLC (“NASDAQ”) have imposed various requirements on public companies, including establishment and maintenance of effective

disclosure and financial controls and corporate governance practices.

and financial controls and corporate governance practices.

Implementing and maintaining internal controls is time consuming and costly.

If we fail to maintain an effective internal control environment or to comply with the numerous

legal and regulatory requirements imposed on public companies, we could make material errors in, and be required to restate, our financial statements.

Any such restatement could result in a loss of public confidence in the reliability of our

financial statements and sanctions imposed on us by the SEC.

If we are unable to satisfy our obligations as a public company, we could be subject to delisting of our common stock, fines, sanctions and other regulatory action and potentially civil

Anti-takeover provisions in our third amended and restated certificate of incorporation and fourth amended and restated bylaws and under Delaware law could

make an acquisition of us more difficult, limit attempts by our stockholders to replace or remove our current management and limit the market price of our common stock.

If we fail to maintain an effective internal control environment or to comply with the numerous legal and

regulatory requirements imposed on public companies, we could make material errors in, and be required to restate, our financial statements.

Any such restatement could result in a loss of public confidence in the reliability of our financial

statements and sanctions imposed on us by the SEC.

If we are unable to satisfy our obligations as a public company, we could be subject to delisting of our common stock, fines, sanctions and other regulatory action and potentially civil litigation.

Anti-takeover provisions in our third amended and restated certificate of incorporation and fourth amended and restated bylaws and under Delaware law could make an acquisition of

us more difficult, limit attempts by our stockholders to replace or remove our current management and limit the market price of our common stock.

Provisions in our third amended and restated certificate of incorporation and fourth amended and restated bylaws may have the effect of delaying or preventing a change of control or changes in our management.

third amended and restated certificate of incorporation and fourth amended and restated bylaws include provisions that:

amended and restated certificate of incorporation and fourth amended and restated bylaws include provisions that:

authorize our Board to issue, without further action by the stockholders, up to 50,000,000 shares of undesignated preferred stock;

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establish an advance notice procedure for stockholder proposals to be brought before an annual meeting, including proposed nominations of persons for election to our Board;

establish that our Board is divided into three classes until the annual meeting of the stockholders to be held in 2022, with each director serving a one-year term;

prohibit cumulative voting in the election of directors;

provide that vacancies on our Board may be filled only by a majority of directors then in office, even though less than a quorum.

These provisions may frustrate or prevent any attempts by our stockholders to replace or remove our current management by making it more difficult for stockholders to replace members of our Board, which is

responsible for appointing the members of our management.

for appointing the members of our management.

Our third amended and restated certificate of incorporation designates the Court of Chancery of the State of Delaware as the exclusive forum for certain litigation that may be

initiated by our stockholders, which could increase costs of bringing a claim, discourage claims, or limit our stockholders’ ability to obtain a favorable judicial forum for disputes with us or our directors, officers, or employees.

Specifically, the certificate of incorporation provides that, unless we consent in writing in advance to the selection of an alternative forum, the Court of Chancery of the State of Delaware is the sole and

exclusive forum, to the fullest extent provided by law, for the following types of actions or proceedings:

forum, to the fullest extent provided by law, for the following types of actions or proceedings:

any derivative action or proceeding brought on behalf of the Company;

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Application of the choice of forum provision may be limited in some instances by law.

Section 27 of the Securities Exchange Act of 1934 (“Exchange Act”) provides for exclusive federal court jurisdiction over

Exchange Act claims.

Accordingly, to the extent the exclusive forum provision is held to cover a shareholder derivative action asserting claims under the Exchange Act, such claims could not be brought in the Delaware Court of Chancery and would

instead be within the jurisdiction of the federal district court for the District of Delaware.

Section 22 of the Securities Act of 1933 (“Securities Act”) creates concurrent jurisdiction for federal and state courts over all suits brought to

enforce any duty or liability created by the Securities Act or the rules and regulations thereunder.

Moreover, our stockholders will not be deemed by operation of our choice of forum provision to have waived our compliance with the federal

securities laws and the regulations promulgated thereunder.

It is also possible that, notwithstanding the forum selection clause, a court could rule that such a provision is inapplicable or unenforceable, which could adversely impact our results

of operations, financial position and cash flows.

If securities analysts or industry analysts downgrade our shares, publish negative research or reports or do not publish reports about our business, our share price and

trading volume could decline.

Section 27 of the Securities Exchange Act of 1934 (“Exchange Act”) provides for exclusive federal court jurisdiction over Exchange

within the jurisdiction of the federal district court for the District of Delaware.

Section 22 of the Securities Act of 1933 (“Securities Act”) creates concurrent jurisdiction for federal and state courts over all suits brought to enforce any duty or

liability created by the Securities Act or the rules and regulations thereunder.

Moreover, our stockholders will not be deemed by operation of our choice of forum provision to have waived our compliance with the federal securities laws and the

regulations promulgated thereunder.

It is also possible that, notwithstanding the forum selection clause, a court could rule that such a provision is inapplicable or unenforceable, which could adversely impact our results of operations, financial

position, and cash flows.

If securities analysts or industry analysts downgrade our shares, publish negative research or reports, or do not publish reports about our business, our share price and trading

volume could decline.

The trading market for our common stock is to some extent influenced by the research and reports that industry or securities analysts publish about us, our business, and our industry.

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Even if we do obtain analyst coverage, if one or more analysts adversely change their recommendation regarding our shares or our competitors’ stock, our share price might decline.

one or more analysts cease coverage of us or fail to regularly publish reports on us, we might lose visibility in the financial markets, which, in turn, could cause our share price or trading volume to decline.

or more analysts cease coverage of us or fail to regularly publish reports on us, we might lose visibility in the financial markets, which, in turn, could cause our share price or trading volume to decline.

Future sales of our common stock in the public market could cause the market price of our common stock to decrease significantly.

Sales of substantial amounts of our common stock in the public market by our existing stockholders or upon the exercise of outstanding stock options or grant of stock options or restricted

stock units in the future may cause the market price of our common stock to decrease significantly.

As of January 29, 2022, we have an aggregate of 1,234,798 shares of common stock issuable upon exercise of outstanding options and the vesting of

restricted stock units under the 2015 Equity Incentive Plan (the “2015 Plan” and together with the 2012 Equity Incentive Plan, the “Equity Plans”) (400,996 of which are fully vested).

Sales of substantial amounts of our common stock in the public market by our existing stockholders or upon the exercise of outstanding stock options or grant of stock options or restricted stock units

in the future may cause the market price of our common stock to decrease significantly.

As of January 28, 2023, we have an aggregate of 1,485,529 shares of common stock issuable upon exercise of outstanding options and the vesting of restricted stock

units under the 2015 Equity Incentive Plan (the “2015 Plan” and together with the 2012 Equity Incentive Plan, the “Equity Plans”) (509,073 of which are fully vested).

The perception that such sales could occur could also depress the market price of our common stock.

Any such sales could also create public perception of difficulties or problems with our

business and might also make it more difficult for us to raise capital through the sale of equity securities in the future at a time and price that we deem appropriate.

Ollie’s Bargain Outlet Holdings, Inc.

(“Holdings”) is a holding company and relies on dividends and other payments, advances and

transfers of funds from its subsidiaries to meet its obligations and pay any dividends.

Holdings has no direct operations and no significant assets other than ownership of 100% of the capital stock of its subsidiaries.

Because Holdings conducts operations through subsidiaries, it

depends on those entities for dividends and other payments to generate the funds necessary to meet financial obligations and to pay any dividends with respect to its common stock.

Legal and contractual restrictions in the Credit Facility (defined

below) and other agreements which may govern future indebtedness of subsidiaries, as well as the financial condition and operating requirements of subsidiaries, may limit its ability to obtain cash from subsidiaries.

The earnings from, or other

available assets of, subsidiaries might not be sufficient to pay dividends or make distributions or loans to enable Holdings to pay any dividends on its common stock or other obligations.

Any of the foregoing could materially and adversely affect

our business, financial condition, results of operations and cash flows.

Any such sales could also create public perception of difficulties or problems with our business and

might also make it more difficult for us to raise capital through the sale of equity securities in the future at a time and price that we deem appropriate.

Our stock price has been and may continue to be volatile.

The market price of our common stock has fluctuated substantially in the past and may continue to fluctuate significantly.

For example, during the fiscal year ended January 28, 2023, our stock price

fluctuated from a high of $72.27 to a low of $37.67.

Future announcements or disclosures concerning us or any of our competitors, our strategic initiatives, our sales and profitability, our financial condition, any quarterly variations in actual or

anticipated operating results or comparable sales, any failure to meet analysts’ expectations and sales of large blocks of our common stock, among other factors, could cause the market price of our common stock to fluctuate substantially.

addition, the stock market has experienced price and volume fluctuations that have affected the market price of many retail and other stocks that have often been unrelated or disproportionate to the operating performance of these companies.

We are a holding company and rely on dividends and other payments, advances, and transfers of funds from our subsidiaries to meet our obligations and pay any

We have no direct operations and no significant assets other than ownership of 100% of the capital stock of our subsidiaries.

Because we conduct operations through our subsidiaries, we depend on those

entities for dividends and other payments to generate the funds necessary to meet financial obligations and to pay any dividends with respect to our common stock.

Legal and contractual restrictions in the Credit Facility (defined below) and other

agreements which may govern future indebtedness of our subsidiaries, as well as the financial condition and operating requirements of our subsidiaries, may limit our ability to obtain cash from our subsidiaries.

The earnings from, or other available

assets of, our subsidiaries might not be sufficient to pay dividends or make distributions or loans to enable us to pay any dividends on our common stock or other obligations.

Any of the foregoing could materially and adversely affect our business,

financial condition, results of operations, and cash flows.

We do not expect to pay any cash dividends for the foreseeable future.

The continued operation and expansion of our business will require substantial funding.

We do not anticipate that we will pay any dividends to holders of our common stock for the foreseeable

Any payment of cash dividends will be at the discretion of our Board and will depend on our financial condition, capital requirements, legal requirements, earnings and other factors.

Our ability to pay dividends is restricted by the terms

of our Credit Facility and might be restricted by the terms of any indebtedness that we incur in the future.

Accordingly, realization of any gain on our common stock will depend on the appreciation of the price of the shares of our common stock,

which may never occur.

We do not anticipate that we will pay any dividends to holders of our common stock for the foreseeable future.

payment of cash dividends will be at the discretion of our Board and will depend on our financial condition, capital requirements, legal requirements, earnings and other factors.

Our ability to pay dividends is restricted by the terms of our Credit

Facility and might be restricted by the terms of any indebtedness that we incur in the future.

Accordingly, realization of any gain on our common stock will depend on the appreciation of the price of the shares of our common stock, which may never

Our business and reputation may be adversely affected by environmental, social and governance matters.

Investor and regulatory focus is intensifying with respect to certain environmental, social and governance (“ESG”) matters.

These matters include, among others, efforts and mitigation of the impact of

climate change, human rights matters, ethics and compliance with law, diversity, equity and inclusion, and the role of the Board in supervising various sustainability issues.

Additionally, in the retail industry, the materials used in the products we

sell as well as where we source our products is of particular importance.

In addition, investment in funds that specialize in companies that perform well in ESG assessments are increasingly popular, and major institutional investors and advisors have publicly emphasized the

importance of ESG measures to their investment decisions and recommendations.

Investors who are focused on ESG matters may seek enhanced disclosures or require implementation of policies that may be adverse to our business, and there can be no

assurances that shareholders will not advocate, via proxy contests, media campaigns or other public or private means, for us to take ESG focused actions on an accelerated timeline.

Additionally, there can be no certainty that we will successfully navigate or manage ESG issues or that we will successfully meet investors or others expectations.

Any failure or perceived failure by us

in this regard could have a material adverse effect on our reputation with governments, customers, employees, other third parties and the communities and industries in which we operate, as well as, on our business, share price, financial condition,

access to capital, or results of operations.

INDEBTEDNESS AND CAPITALIZATION

Indebtedness may limit our ability to invest in the ongoing needs of our business and if we are unable to comply with our financial covenants, it could have

a material adverse effect on our liquidity and our business, financial condition and results of operations.

On May 22, 2019, the Company completed a transaction in which it refinanced its credit facility (the

“Credit Facility”) which includes a revolving credit facility (the “Revolving Credit Facility”).

As of January 29, 2022, we had no outstanding borrowings on the Revolving Credit Facility,

with $84.7 million of borrowing availability.

We may, from time to time, incur additional indebtedness.

Indebtedness may limit our ability to invest in the ongoing needs of our business and if we are unable to comply with our financial covenants, it could have a material adverse

effect on our liquidity and our business, financial condition, and results of operations.

The Company’s credit facility (the “Credit Facility”) provides for a five-year $100.0 million revolving credit facility, which includes a $45.0 million sub-facility for letters of credit and a $25.0

million sub-facility for swingline loans (the “Revolving Credit Facility”).

As of January 28, 2023, we had no outstanding borrowings on the Revolving Credit Facility, with $87.0 million of borrowing availability.

We may, from time to time, incur

additional indebtedness.

The agreements governing our Credit Facility place certain conditions on us, including that they:

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limit our ability to obtain additional financing in the future for working capital or other purposes;

require us to utilize our cash flows from operations to make payments on indebtedness, reducing the availability of our cash flows to fund working capital, capital expenditures, development activity and other general corporate

place us at a competitive disadvantage compared to our competitors that have less indebtedness.

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enter into certain transactions with our affiliates.

Failure to comply with certain covenants or the occurrence of a change of control under our Credit Facility could result in the acceleration of our obligations under the Credit Facility, which

would materially adversely affect our liquidity, capital resources and results of operations.

Failure to comply with certain covenants or the occurrence of a change of control under our Credit Facility could result in the acceleration of our obligations under the Credit Facility, which would

materially adversely affect our liquidity, capital resources and results of operations.

Under certain circumstances, our Credit Facility requires us to comply with certain financial covenants regarding our fixed charge coverage ratio.

Failure to comply could result in a default

and an acceleration of our obligations under the Credit Facility, which could have a material adverse effect on our liquidity and our business, financial condition and results of operations.

Management’s Discussion and Analysis of

Financial Condition and Results of Operations – Liquidity and Capital Resources – Credit Facilities.”

We may be unable to generate sufficient cash flows to satisfy debt service obligations, which could have a material adverse effect on our business,

financial condition and results of operations.

Our ability to make principal and interest payments on and to refinance indebtedness will depend on our ability to generate cash in the future and is subject to general economic, financial,

competitive, legislative, regulatory and other factors that are beyond our control.

If our business does not generate sufficient cash flows from operations, in the amounts projected or at all, or if future borrowings are not available to us in

amounts sufficient to fund our other liquidity needs, our business, financial condition and results of operations could be materially adversely affected.

If we cannot generate sufficient cash flows from operations to make scheduled principal and

interest payments in the future, we may need to refinance all or a portion of indebtedness on or before maturity, sell assets, delay capital expenditures or seek additional equity.

The terms of future debt agreements, including our Credit

Facility, may also restrict us from affecting any of these alternatives.

Further, changes in the credit and capital markets, including market disruptions and interest rate fluctuations, may increase the cost of financing, make it more difficult

to obtain favorable terms, or restrict our access to these sources of future liquidity.

If we are unable to refinance indebtedness on commercially reasonable terms or at all or to effect any other action relating to indebtedness on satisfactory

terms or at all, it could have a material adverse effect on our business, financial condition and results of operations.

Failure to comply could result in a default and an

acceleration of our obligations under the Credit Facility, which could have a material adverse effect on our liquidity and our business, financial condition and results of operations.

Management’s Discussion and Analysis of Financial

Condition and Results of Operations - Liquidity and Capital Resources - Credit Facilities.”

We may be unable to generate sufficient cash flows to satisfy debt service obligations, which could have a material adverse effect on our business, financial

condition and results of operations.

Our ability to make principal and interest payments on and to refinance indebtedness will depend on our ability to generate cash in the future and is subject to general economic, financial, competitive,

legislative, regulatory, and other factors that are beyond our control.

If our business does not generate sufficient cash flows from operations, in the amounts projected or at all, or if future borrowings are not available to us in amounts sufficient

to fund our other liquidity needs, our business, financial condition and results of operations could be materially adversely affected.

If we cannot generate sufficient cash flows from operations to make scheduled principal and interest payments in

the future, we may need to refinance all or a portion of indebtedness on or before maturity, sell assets, delay capital expenditures, or seek additional equity.

The terms of future debt agreements, including our Credit Facility, may also restrict us

from affecting any of these alternatives.

Further, changes in the credit and capital markets, including market disruptions and interest rate fluctuations, may increase the cost of financing, make it more difficult to obtain favorable terms, or

restrict our access to these sources of future liquidity.

If we are unable to refinance indebtedness on commercially reasonable terms or at all or to effect any other action relating to indebtedness on satisfactory terms or at all, it could have a

material adverse effect on our business, financial condition, and results of operations.

We cannot guarantee that our share repurchase program will be fully consummated or that it will enhance long-term stockholder value.

We have adopted a share repurchase program under which we are currently authorized to repurchase up to $200.0 million of shares of our common stock through December 2023.

authorization of the repurchase program has an expiration date, the authorizations are subject to extension or earlier termination by the Board of Directors at any time and we are not obligated to repurchase a specified number or dollar value of

shares under our share repurchase program.

While the authorization of the

repurchase program has an expiration date, the authorizations are subject to extension or earlier termination by the Board of Directors at any time and we are not obligated to repurchase a specified number or dollar value of shares under our share

repurchase program.

Even if our share repurchase program is fully implemented, it may not enhance long-term stockholder value.

Also, the amount, timing, and execution of our share repurchase program may fluctuate based on

our priorities for the use of cash for other purposes and because of changes in cash flows, tax laws, and the market price of our common stock

Also, the amount, timing, and execution of our share repurchase program may fluctuate based on our priorities for the use

of cash for other purposes and because of changes in cash flows, tax laws, and the market price of our common stock.

Unresolved Staff Comments

Compared sentence by sentence after normalising whitespace, quotation marks, case and digits, so re-formatting and restated figures do not read as changed language. Wording changes appear as one removal and one addition. The current filing and the prior one are authoritative.

What changed 10-K

Item 1. Business