An uncertain future awaits the staff and management of the Factory 2-U store at Bear Creek Shopping Center on Biddle Road.

The retailer sells closeout merchandise and excess branded apparel in a market pitting it against the likes of Dollar Tree and Big Lots! The Medford store is one of 172 in seven states that began liquidation sales Labor Day weekend. But that’s about all store employees know.

"They’re not telling us much," said Factory 2-U’s Medford store manager Nathan Silva, who was vacationing in Hawaii when he found out about the store’s imminent demise.

San Diego-based Factory 2-U Stores Inc. filed for Chapter 11 bankruptcy protection on Jan. 13 and soon after closed 44 of its stores, including one in Grants Pass. To date, 71 locations have been shuttered.

Last month, Factory 2-U Acquisition LLC, a company formed by an affiliate of National Stores Inc., The Alamo Group, Garcel Inc. and The Ozer Group LLC, struck a deal to buy nearly all of the failing company’s stores, inventory, leases and distribution center for more than $28 million.

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One possible scenario for the Bear Creek center location is a Fallas Paredes, operated by National Stores Inc., which is based in Gardena, Calif. Fallas Paredes caters to the Hispanic community, which would make it a good fit in Medford.

"We’re supposed to find out next week or the week after if we’re going to have jobs after the liquidation," Silva said.

The Bear Creek Shopping Center has been a good location for Factory 2-U, he said, with discount stores Big Lots, Dollar Tree and Tuesday Morning close by.

"Even having Bi-Mart next door is good, because the same people shop at all those different stores," Silva said. "Factory 2-Us tend to be near other discount stores. Their whole goal is for people to come here first and then go to other ones.

"Back in January, all the stores were evaluated and we were doing all right. Without looking at every single store, I can’t tell you how we were doing overall. But we weren’t doing as well as we should have."

The 172 closing stores include 51 in California and 10 in Oregon.

The store generally has 13 or 14 employees, expanding to 30 during the holiday season. The liquidation process will temporarily boost the payroll to 24, Silva said. "It’ll be kind of like Christmas."

What follows next will be up to National Stores president Michael Fallas, whose office didn’t return phone calls on Tuesday.

According to bankruptcy documents, National Stores agreed to hire at least 2,000 of Factory 2-U’s 3,500 employees. Frank Morton, spokesman for The Ozer Group, which is managing the liquidation, indicated National Stores could reopen 80 or more Factory 2-U stores.

"A lot of that is based on the economics of that particular store and the overall strategy of National Stores," Morton said. "But there is going to be a transition of employees into the new entity."

Reach reporter Greg Stiles at 776-4463 or e-mail business@mailtribune.com.