Family Dollar announces massive closings: How many stores will close and when?
Family Dollar Stores, Inc., owned by Dollar Tree, has announced the closure of nearly 1,000 branches across the United States. When will the stores close?
Family Dollar joins the list of stores that are closing branches in the United States. According to a statement issued by company owner Dollar Tree, the chain will close nearly 1,000 branches around the United States over the next few years. CEO Rick Dreiling attributed the closure to rising inflation as well as the reduction of food stamps (SNAP benefits) by state governments.
“Persistent inflation and reduced government benefits continue to put pressure on the low-income consumers who make up a sizable portion of Family Dollar’s customer base,” Dreiling said, according to statements reported by CNN.
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Family Dollar reports 4th quarter losses
The discount store chain disclosed in its latest earnings report that it registered unexpected losses in the fourth quarter. Following the closures announcement, Dollar Tree shares fell 14%.
The store closures also come weeks after the United States Food and Drug Administration (FDA) fined the company after discovering a rodent infestation two years ago that affected about 400 branches.
“The inspection found live rodents, dead rodents in various states of decomposition, rodent feces and urine, evidence of rodents, nests and odors of rodents throughout the facility, dead birds and bird droppings, and products stored in conditions that did not protect against contamination,” the agency said in a statement.
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How many Family Dollar stores will close and when?
The company announced that by the first half of 2024, the closure of 600 branches will be completed, while another 370 stores will close in the coming years as their respective leases expire. The variety store chain also announced the shuttering of 30 Dollar Tree stores in the near future. The locations of the affected branches have not yet been revealed.
In 2015, Dollar Tree acquired Family Dollar for $8.5 billion in hopes of increasing its customer base. However, the alliance was not as successful as expected.
Competitors such as Dollar General have taken away a number of its customers. Dollar General’s success, in large part, is due to its focus on remote locations and rural areas, which is where people usually consume products at low prices.