The Dollar Tree that we once knew is long gone, and it will never be the same again. The discount retail store recently announced that it will be raising its price cap to $7 in its fourth quarter earnings call earlier this year on March 13, 2024. That's up $2 more from the $5 cap it originally set in June 2023. In 2021, the base price was raised to $1.25. Either way, the company name no longer fits the promises of $1 items that it once carried. And its reasoning behind raising the price cap once again is because stores are attracting more buyers with higher incomes.
"The fastest-growing demographic is north of $125,000 a year in income," Dollar Tree CEO Rick Dreiling said. "It's not like the Northeast is strong and the West is weak. That boat is lifting pretty even all the way up."
"This year, across 3,000 stores, we expect to expand our multi-price assortment by over 300 items at price points ranging from $1.50 to $7," he noted. Those items of higher cost will include food, pet, and personal care items.
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"Over time, you will also see us fully integrate multi-price merchandise more into our stores so our shoppers will find $5 bags of dog food next to our traditional $1.25 pet treats and toys, and our $3 bags of candy will be found in the candy aisle," Rick added. The company is also planning to close approximately 600 locations of its Family Dollar stores this year.
