Dollar Tree adding a $1.25 price point

bcla

On our rugged Eastern foothills.....
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Nov 28, 2012
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I guess ordering smaller packages or negotiating prices only worked for so long before inflation caught up.

“We experienced a strong finish to the quarter, as shoppers are increasingly focused on value in this inflationary environment,” stated Michael Witynski, President and Chief Executive Officer. “Our Dollar Tree pricing tests have demonstrated broad consumer acceptance of the new price point and excitement about the additional offerings and extreme value we will be able to provide. Accordingly, we have begun rolling out the $1.25 price point at all Dollar Tree stores nationwide.​
 
It worked because nearly everyone has a dollar, suspect this will be a mistake, they would be smarter to reduce stock to only those things that are a dollar because now they are just a discount store like all the others so no market differentiation.

Stock price has nothing to do with consumer loyalty, they are endangering the thing that makes people choose them, never a good idea.
 
And Five Below changed some stores to Five Beyond.

I remember as a kid there was a 25 cent store at a Farmers Market. But I’m not old enough to remember when 5 & 10’s when nickel and dime operations.
 

I'm not too surprised. In October they began adding items priced at $3 and $5. Including cheaply printed $5 Disney t-shirts.

I love Dollar Tree though. It's branches have some of the sweetest fruits, my frugal friends! The book section alone, I've found some great art books there that typically range at $20-$30.
 
It worked because nearly everyone has a dollar, suspect this will be a mistake, they would be smarter to reduce stock to only those things that are a dollar because now they are just a discount store like all the others so no market differentiation.

Stock price has nothing to do with consumer loyalty, they are endangering the thing that makes people choose them, never a good idea.

Inflation is inevitable. All their major competitors have switched to a model that at least allows for some items to be more than a dollar while still trying to provide value.

At a certain point their bigger name suppliers decide it's not worth it and they lost some of the brand names that were replaced by little known brands. Granted part of their business model is that a dollar is actually quite expensive for some items (like a small bag of Ruffles) and they actually make decent profit from them. But mostly it's the value proposition where they're making small margins on some items. But I think they might be able to either increase the size of some items, or they'll be making considerably more profit with items that currently have extremely tight margins.

The strange thing is that quite a few things are still going to be competitively priced at $1.25.
 
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Not surprising. They can't remain totally at $1 or less forever.

There was a independent 79c store in a crappy strip shopping center near me, but they closed about five years ago. Most of the stuff they sold was total junk and out of code or damaged food products.

And while we're on the subject, why do some analysts compare Dollar Tree to Dollar General and/or Family Dollar? Different business models. Most of the merchandise at DG and FD is priced higher than a dollar.
 
Consumers are not forgiving. I'll do dollar store for random oddball stuff but it is inconvenient to go there, if they start pricing closer to other places then many consumers will do the math and just purchase wherever they get their other stuff because it's the natural thing to do. Why spend time and gas for no benefit? It is what it is and there is always a tipping point, unfortunately for dollar store that quarter is a 25% increase and creates uncertainty which will end up backfiring because a lot of the stuff in there isn't necessity so it's elastic demand.
 
But was ALL the merchandise 10 cents or less?
A lot of it was, all the 5 and 10 cents stuff. :duck: :teeth:

There was stuff there that was priced higher, probably nothing over $5 tops though. One year, I bought my mom and dad a wind alarm clock for their anniversary. I think $2. I do recall they said it ticked quite loudly. :laughing: But a lot at 5¢ and 10¢, some candy was a penny. All regular sized candy bars, $1.50 to $2 today, were 5¢, and that was anywhere, except at the movie theater. There, giant bars were 25¢.
 
I love Dollar Tree! I buy a lot of stuff there. Sure they have some junk but WalMart & Target sell that same junk for way more than a dollar. We have a few that are turning into the Dollar Tree Plus with a $3 & a $5 aisle. My daughters & I hit a Dollar Tree after church every Sunday, lol. My oldest daughter does Dollar Tree hauls on You Tube.
 
I'm not too surprised. In October they began adding items priced at $3 and $5. Including cheaply printed $5 Disney t-shirts.

I love Dollar Tree though. It's branches have some of the sweetest fruits, my frugal friends! The book section alone, I've found some great art books there that typically range at $20-$30.

when I lived near one, I’d go for birthday cards or party supplies. I thought the best purchases were the drinking glasses, though. I still have the Coca Cola ones I got years ago.

I want to go and see what they got, now.
 
The one that just opened not too long ago near me has a great crafting aisle. I followed a tutorial and made a wreath for our front door out of Dollar Tree tabletop Christmas trees and decorations, using only supplies from the store. I LOVE Dollar Tree, and I don't care if some of their stuff will be priced higher. It's the only place to go for party supplies, too.

 
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when I lived near one, I’d go for birthday cards or party supplies. I thought the best purchases were the drinking glasses, though. I still have the Coca Cola ones I got years ago.

I want to go and see what they got, now.
Their seasonal stuff seems to be a big draw. Easy way to pile up on Halloween treats and stocking stuffers. I sound like an ad. "That's right, Ramee, and it's only a dollar!"

I'll buy some snacks there, but I'll skip the refrigerated and no-name stuff.

They have some decent canvas boards, and after the $3-$5 options opened, they've now branched out to full canvases, big sketch books, pencil sets, and other art supplies. The hardbound sketchbooks were labeled $5 but actually ring up as $3. That's an insider tip, folks!
 
They are going to need to change their name. Bargain Tree, Beyond Bargains, or something along those lines.

I do pick up their serving ware, pot holder and disposable pans for the holidays, so that when I take a dish to work or send one with the hubs- they can just trash the pan and the serving utensil.
 
I guess it was inevitable, however it does disappoint me. The whole thing of EVERYTHING being $1 was a pretty cool concept, but all good things must come to an end. I never really bought a lot there, but it do kind of rely on it for some things. That squeeze bottle toothpaste (colgate) is usually there and the exact same stuff (same size and all) is like $3 at Walmart. Even with the price increase, THAT is still a savings. Also, it seems that their "stick lighters" (for candles) work better than the ones you buy elsewhere.

You gotta be careful though, I have noticed a lot of things found at dollar tree are like .88 or so at Walmart.
 


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