Dollar Tree To Raise Prices To $7

[Alpha8472]

I thought the $5 refrigerated food items were overpriced. The CEO wants to raise prices to $7 to increase profits.

https://www.the-sun.com/money/10819524/ ... res-close/

[ClownLoach]

Why not $300 or more? 99 Cents Only was selling $300 kids Power Wheels sets modeled after a Cadillac Escalade and a Lamborghini.

Heck, why not start selling some iPads, cell phones, and Playstations? Why not add some washers and dryers?

These guys are clueless. It's a dollar store for a reason. If they're going to sell items up to $7 then they are inevitably going to wind up priced the same as Walmart and becoming a small Neighborhood Market with a small party department.

[babs]

In other words, why not just rename it Walmart Express?

[ClownLoach]

In other words, why not just rename it Walmart Express?

Or make it all start at $2 and it can become plural. Dollars Tree.

They are taking the lazy way out here by just raising prices. They needed to do it the right way and maintain the dollar price point even if it meant putting a shrink ray on the entire store.

[reymann]

Hmm..... I'm wondering if Dollar Tree ends up rebranding to Family Dollar if these trends continue. The panhandlers outside the store near my house keeps me away from shopping there.

[storewanderer]

I actually see a lot of people buying items that cost more than 99 Cents, at 99 Cents Only... it surprises me...

I do not see this stuff that is priced above 1.25 selling at Dollar Tree much. I am seeing some of the Easter candy selling but the refrigerated food is not moving.

I think these higher cost items will be a large shrink generator for Dollar Tree. But seeing how it has done for 99 Cents Only, maybe I am wrong. I am also not sure exactly how many of these higher cost items they actually have to sell, for this to have a meaningful impact on their top line. I think the number may be quite low.

I suspect the 7.00 price point is a DiGiorno Frozen Pizza.

This also brings Dollar Tree additional overhead to deal with things like scan accuracy and security/loss prevention. Also much greater concern on recovery because customers love to misplace items in Dollar Tree and the stores are quite a mess. But if customers start misplacing $7 perishable items the losses will add up fast for a store that typically doesn't have much loss or if they do it is a few expired 1.25 milk containers or something random.

Wall Street has been pressuring them to do this for years.

The problem is they already have a multiple price format-Family Dollar. It is not performing well. This tells me they do not understand that type of format. I do not see how they will magically understand it with these changes they are making to Dollar Tree.

[HCal]

I actually see a lot of people buying items that cost more than 99 Cents, at 99 Cents Only... it surprises me...

I do not see this stuff that is priced above 1.25 selling at Dollar Tree much. I am seeing some of the Easter candy selling but the refrigerated food is not moving.

I think these higher cost items will be a large shrink generator for Dollar Tree. But seeing how it has done for 99 Cents Only, maybe I am wrong. I am also not sure exactly how many of these higher cost items they actually have to sell, for this to have a meaningful impact on their top line. I think the number may be quite low.

I suspect the 7.00 price point is a DiGiorno Frozen Pizza.

This also brings Dollar Tree additional overhead to deal with things like scan accuracy and security/loss prevention. Also much greater concern on recovery because customers love to misplace items in Dollar Tree and the stores are quite a mess. But if customers start misplacing $7 perishable items the losses will add up fast for a store that typically doesn't have much loss or if they do it is a few expired 1.25 milk containers or something random.

Wall Street has been pressuring them to do this for years.

The problem is they already have a multiple price format-Family Dollar. It is not performing well. This tells me they do not understand that type of format. I do not see how they will magically understand it with these changes they are making to Dollar Tree.

99 Cents Only and Dollar Tree basically took opposite approaches to raising prices. 99 Cents Only slowly eased people into it. At first, they introduced higher price points on a few items (I think gallons of milk were first), and had signage explaining the higher prices ("we obviously can't sell wine for 99 cents, but we found a good deal and wanted to pass it on to you!"). The cashiers would often ask "this is $1.99, is that okay?" as they were scanning your things. They also paired the price increases with a broader variety of items, to the point that I see people seemingly doing their weekly grocery shop there, with produce, dairy, bread, etc.

Dollar Tree has basically done the opposite. An abrupt 25% increase on all items, followed by a new $3 and $5 section, is not going to be well received, especially when there is no positive change to offset the news.

[storewanderer]

I actually see a lot of people buying items that cost more than 99 Cents, at 99 Cents Only... it surprises me...

I do not see this stuff that is priced above 1.25 selling at Dollar Tree much. I am seeing some of the Easter candy selling but the refrigerated food is not moving.

I think these higher cost items will be a large shrink generator for Dollar Tree. But seeing how it has done for 99 Cents Only, maybe I am wrong. I am also not sure exactly how many of these higher cost items they actually have to sell, for this to have a meaningful impact on their top line. I think the number may be quite low.

I suspect the 7.00 price point is a DiGiorno Frozen Pizza.

This also brings Dollar Tree additional overhead to deal with things like scan accuracy and security/loss prevention. Also much greater concern on recovery because customers love to misplace items in Dollar Tree and the stores are quite a mess. But if customers start misplacing $7 perishable items the losses will add up fast for a store that typically doesn't have much loss or if they do it is a few expired 1.25 milk containers or something random.

Wall Street has been pressuring them to do this for years.

The problem is they already have a multiple price format-Family Dollar. It is not performing well. This tells me they do not understand that type of format. I do not see how they will magically understand it with these changes they are making to Dollar Tree.

99 Cents Only and Dollar Tree basically took opposite approaches to raising prices. 99 Cents Only slowly eased people into it. At first, they introduced higher price points on a few items (I think gallons of milk were first), and had signage explaining the higher prices ("we obviously can't sell wine for 99 cents, but we found a good deal and wanted to pass it on to you!"). The cashiers would often ask "this is $1.99, is that okay?" as they were scanning your things. They also paired the price increases with a broader variety of items, to the point that I see people seemingly doing their weekly grocery shop there, with produce, dairy, bread, etc.

Dollar Tree has basically done the opposite. An abrupt 25% increase on all items, followed by a new $3 and $5 section, is not going to be well received, especially when there is no positive change to offset the news.

Dollar Tree is basically copying the approach the Dollarama chain in Canada took to handling its price increase and shift in product mix. Dollarama very successfully moved away from a single price point maximum price format but their stores are a little different than Dollar Tree; they are much better stocked and do not have as many "suspect" brands. They are also better staffed, have had things like self checkouts for quite some time, and in general while some categories are weaker than Dollar Tree, they are a store that is more interesting to stock as every location is stuffed with products.

People were always doing weekly grocery shopping at 99 Only even back when everything was 99 cents... if anything I saw more people doing big grocery shops before than I do now. But their produce is a trainwreck most of the time in my stores; that used to be a draw and I think it has hurt them.

With that said I have bought a number of "above 99 cents" items at 99 Only; some approaching $10. I have been very happy with my purchases.

[ClownLoach]

I actually see a lot of people buying items that cost more than 99 Cents, at 99 Cents Only... it surprises me...

I do not see this stuff that is priced above 1.25 selling at Dollar Tree much. I am seeing some of the Easter candy selling but the refrigerated food is not moving.

I think these higher cost items will be a large shrink generator for Dollar Tree. But seeing how it has done for 99 Cents Only, maybe I am wrong. I am also not sure exactly how many of these higher cost items they actually have to sell, for this to have a meaningful impact on their top line. I think the number may be quite low.

I suspect the 7.00 price point is a DiGiorno Frozen Pizza.

This also brings Dollar Tree additional overhead to deal with things like scan accuracy and security/loss prevention. Also much greater concern on recovery because customers love to misplace items in Dollar Tree and the stores are quite a mess. But if customers start misplacing $7 perishable items the losses will add up fast for a store that typically doesn't have much loss or if they do it is a few expired 1.25 milk containers or something random.

Wall Street has been pressuring them to do this for years.

The problem is they already have a multiple price format-Family Dollar. It is not performing well. This tells me they do not understand that type of format. I do not see how they will magically understand it with these changes they are making to Dollar Tree.

99 Cents Only and Dollar Tree basically took opposite approaches to raising prices. 99 Cents Only slowly eased people into it. At first, they introduced higher price points on a few items (I think gallons of milk were first), and had signage explaining the higher prices ("we obviously can't sell wine for 99 cents, but we found a good deal and wanted to pass it on to you!"). The cashiers would often ask "this is $1.99, is that okay?" as they were scanning your things. They also paired the price increases with a broader variety of items, to the point that I see people seemingly doing their weekly grocery shop there, with produce, dairy, bread, etc.

Dollar Tree has basically done the opposite. An abrupt 25% increase on all items, followed by a new $3 and $5 section, is not going to be well received, especially when there is no positive change to offset the news.

Dollar Tree is basically copying the approach the Dollarama chain in Canada took to handling its price increase and shift in product mix. Dollarama very successfully moved away from a single price point maximum price format but their stores are a little different than Dollar Tree; they are much better stocked and do not have as many "suspect" brands. They are also better staffed, have had things like self checkouts for quite some time, and in general while some categories are weaker than Dollar Tree, they are a store that is more interesting to stock as every location is stuffed with products.

People were always doing weekly grocery shopping at 99 Only even back when everything was 99 cents... if anything I saw more people doing big grocery shops before than I do now. But their produce is a trainwreck most of the time in my stores; that used to be a draw and I think it has hurt them.

With that said I have bought a number of "above 99 cents" items at 99 Only; some approaching $10. I have been very happy with my purchases.

I wish Dollarama was in the US. Great stores. Always had a blast shopping them in Quebec.

[storewanderer]

I wish Dollarama was in the US. Great stores. Always had a blast shopping them in Quebec.

If Dollar Tree allocated more payroll dollars to its stores and just slightly ramped up its buying operation (which I have seen mix improvements at 1.25, they really have added some items that weren't there before), they could have stores that were very similar to Dollarama.

It appears Dollarama is a $5 maximum price point. So about $3.75 USD.