Dollar Tree Inc. has revealed plans to close 1,000 stores, including 600 Family Dollar locations, within the first half of fiscal 2024. The company stated that these planned closures resulted in fourth-quarter charges exceeding $2 billion, as reported in its fiscal 2023 results.
The Jasper Dollar Tree Family Dollar location is among those scheduled to close, with inventory already being significantly reduced in price to prepare for the store's closure. No final day of operation has been released to the public at this time.
Formed in 2015 through the merger of Dollar Tree and Family Dollar, the company had previously announced intentions to review its store portfolio. Alongside the closure of 600 Family Dollar stores in the coming months, Dollar Tree Inc. also intends to shutter about 370 Family Dollar and 30 Dollar Tree stores over the next several years upon the expiration of each store's lease.
The announcement of store closures, along with weaker-than-anticipated fourth-quarter results, led to a double-digit decline in the company's stock value on Wednesday.
Rick Dreiling, Chairman and CEO, discussed the success of Dollar Tree's multi-price-point strategy during a conference call with analysts, noting significant customer acceptance. Under the initiative named "More Choices," frozen and refrigerated items priced at $3, $4, and $5 have been introduced in 6,500 stores, with plans for further expansion. He also outlined the company's efforts to enhance offerings at Family Dollar stores, including the addition of 17,000 cooler doors in 2023, exceeding initial projections.
Dreiling attributed growth in consumable products to the retailer's ability to attract new and higher-income customers, alongside an emphasis on private brands. He also addressed challenges at Family Dollar, mentioning cutbacks in Supplemental Nutrition Assistance Program (SNAP) benefits as a contributing factor.
Family Dollar Stores LLC recently plead guilty to holding consumer products under insanitary conditions in a rodent-infested West Memphis warehouse, in Eastern Arkansas. The company agreed to pay $41.675 million for the infraction.
