When you hear the phrase ‘Dollar Tree Closing Stores,’ it can easily stir emotions of shock and disbelief. After all, who hasn’t stopped by a Dollar Tree for those unbeatable deals?
But with the kind of presence this brand has in the market, one would likely struggle to figure out why it may be closing multiple stores at the same time. Could it be that Dollar Tree is going out of business? Or is Dollar Tree closing stores in order to restrategize and adapt to the new change in customer preference?
In this post, we will help you get all the answers you need concerning recent Dollar Tree store closures. Just keep reading!
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What is Dollar Tree: A Closer Look at the Brand
Before we unravel the mystery behind Dollar Tree’s store closures, let’s first take a closer look at the company. That will be especially beneficial for those who are not so familiar with the brand. Perhaps it will also help them see why many people are really concerned when they hear the news that Dollar Tree closing stores.
Dollar Tree is an American success story. The brand started its journey in Norfolk, Virginia, in 1986. Founded by Macon F. Brock Jr., Doug Perry, and Ray Compton, the concept was innovative yet straightforward. They simply want to create a store where you can get everything for just a dollar.
This unique approach quickly propelled Dollar Tree into popularity. Of course, who wouldn’t want to patronize a store where you can get most of the things you need for just a dollar?
Today, Dollar Tree proudly operates over 15,000 stores, stretching across North America. This makes them one of the continent’s most extensive discount retail chains. Now, let’s see if it’s actually true that Dollar Tree is closing stores.
Is Dollar Tree Closing Stores?
The internet is abuzz with articles and rumors surrounding Dollar Tree’s alleged massive store closures. The truth is a bit different. It’s not Dollar Tree that’s shuttering all its doors but the Family Dollar stores under its wing.
Out of the vast number of stores they operate, plans are in motion to close up to 390 Family Dollar locations and rebrand roughly 200 as Dollar Tree. While some closures have been attributed to maintenance concerns, you need to know that these closures don’t mean the end of Dollar Tree. It doesn’t signify that Dollar Tree itself is wrapping up its operations.
Why is the Brand Closing its Stores?
Looking at the situation closely, there is more than one factor responsible for these store closures. Yes, many factors are causing Family Dollar store closures. Some factors we could pinpoint include the desire to streamline operations, refine the business strategy, and deal with maintenance issues. Let’s break it down.
We live in the digital age, and e-commerce has seen unprecedented growth. Many consumers find it more convenient to shop online, with goods delivered directly to their doors. The migration to e-commerce has impacted physical stores, causing reduced foot traffic and subsequent decreased sales. Because of this, many retail stores are shuttering their stores and focusing more on their e-commerce arm, including Dollar Tree.
High operational cost is another thing worth mentioning here. The recent years have seen an uptick in labor costs. Add to that the higher rents in some areas, and the cost of running a brick-and-mortar store can escalate quickly. For Dollar Tree and Family Dollar, these mounting operational costs can thin the profit margins, making it unsustainable to keep certain stores open.
Despite Dollar Tree closing stores, the brand said they have no intention of completely shutting down operations. Instead, it is an internal business strategy to streamline operations and reduce costs. They are simply trying to focus on more profitable locations or segments.
What Dollar Tree Stores are Closing?
A closer look reveals that while some Dollar Tree and Family Dollar stores have seen closures, Dollar Tree hasn’t made any official sweeping statement or action about a complete shutdown. Some Family Dollar stores began closing in December 2022, but the exact locations have yet to be publicly disclosed.
What Business Model is Dollar Tree Using?
At its core, Dollar Tree’s business model revolves around the promise of everything for a dollar. The company works relentlessly, partnering with manufacturers, distributors, and wholesalers to ensure that customers benefit from these savings.
Notably, Dollar Tree’s shelves are always stuck with both recognizable brands and private-label products. They do this to make sure the brand is able to provide every of its customers with variety and value.
Who is Taking Over Dollar Tree?
Change is a part of growth, and Dollar Tree is no exception. The retail giant recently announced that Rick Dreiling would be taking the helm as the new CEO, effective January 29. Not new to the company, Dreiling has served as the executive chairman of Dollar Tree since the previous March and will now lead the company forward, retaining his chairman title.
Dirt Cheap is Also Facing the Same Fate
The retail landscape is ever-evolving, and Dollar Tree isn’t the only one adapting to these changes. Dirt Cheap, a renowned “extreme value retailer,” is also undergoing a transformation.
With stores spread across eight southeastern U.S. states, Dirt Cheap is sadly closing several locations, particularly in Texas, where 13 stores are shutting down. These closures are a strategic decision aiming to reposition the brand for future growth.
So, when you hear that Dollar Tree closing stores, you shouldn’t immediately assume that the company is going out of business or struggling financially. It could be a strategic move to move the brand forward, just like many brands in the industry are presently doing.
Dollar Tree Closing Stores – Final Note
We believe you now know why Dollar Tree is closing some of its stores. While store closures might sound alarming, they often signal a brand’s attempt to recalibrate and emerge stronger. For loyal Dollar Tree shoppers, they don’t have to panic over these closures. Just keep calm, and as always, enjoy the fantastic deals these stores offer.