Inflation is changing the way Americans shop, and since October 2022, over 20% of consumers consistently report they go to dollar stores to buy their groceries. While dollar stores only received about 3.3% of total grocery sales in 2022, Dollar Tree plans to capitalize on the shifting shopping habits of people trying to lower their grocery bills.
In late 2021, after 35 years, Dollar Tree announced they were changing their price point of everything being $1 to everything in the store being $1.25. In 2022, $3 and $5 merchandise became available in more than 1800 Dollar Tree stores. The higher priced items are part of the Dollar Tree Plus initiative.
In a March 1, 2023, earnings call, Rick Dreiling, Dollar Tree Chairman & CEO, shared the company’s plans for the future. “We plan to add these multiple price point products in another 1800 or more stores in 2023,” Dreiling said.
In 2022, Dollar Tree installed new coolers to 3500 stores. Dreiling said Dollar Tree would be, “aggressively expanding” their $3, $4, and $5 frozen and refrigerated food options. “This consists of three cooler doors, one at each price point, with an attractive selection of proteins, pizza, ice cream, and more, which the customers are responding positively to,” Dreiling said.
Per their website, nonperishable Dollar Tree Plus items include laundry care, kitchen tools and gadgets, lawn and garden, toys and games, seasonal decorations, home décor, and more. Dreiling noted during the earnings call that the shoppers who purchase one or more Dollar Tree Plus items spend double the amount compared to shoppers who only purchase merchandise priced at $1.25.
Not only are Dollar Tree stores adding to their inventory, they are also adding stores. During the earnings call, Jeff Davis, Chief Financial Officer said, “Our growth and productivity improvement projects will include approximately 650 new stores.” He also noted there are plans to renovate 1000 stores in 2023.
In a recent financial report, Dreiling said, “We are on an accelerating journey of change, and I am incredibly proud of our 207,000 associates for their contributions and commitment to our Company. We have undergone a significant amount of change in less than one year, and believe we have the team in place to capture the opportunity ahead of us.”
How do you feel about Dollar Tree expanding their merchandise options for the consumer? Do you do some or all of your grocery shopping at dollar stores? If not, as food prices continue to rise, would you consider making dollar stores part of your grocery shopping routine? I’d love to hear your thoughts in the comments!
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