Dollar Tree hikes prices 25%. Most items will cost $1.25
New York (CNN Business)Dollar Tree will soon be $1.25 tree.
The company — one of America's last remaining true dollar stores — said Tuesday it will raise prices from $1 to $1.25 on the majority of its products by the first quarter of 2022. The change is a sign of the pressures low-cost retailers face holding down prices during a period of rising inflation.
Dollar Tree (DLTR) said in a quarterly earnings release Tuesday that its decision to raise prices to $1.25 permanently, however, was "not a reaction to short-term or transitory market conditions."
Selling stuff strictly for $1 hampered Dollar Tree, the company said, and forced it stop selling some "customer favorites." Raising prices will give Dollar Tree more flexibility to reintroduce those items, expand its selection and bring new products and sizes to its stores.
Dollar Tree also said that hiking prices will help the company increase its profit margins by "mitigating historically high merchandise cost increases," including freight and distribution costs, as well as wage increases.
"This is the appropriate time to shift away from the constraints of the $1 price point," CEO Michael Witynski said in a statement.
The end of dollar stores
Dollar Tree carries primarily seasonal goods, toys, stationary, home decor, kitchenware and party items.
It caters to suburban, middle-income shoppers, unlike Dollar General (DG), its more rural-focused rival. Family Dollar — owned by Dollar Tree — targets mostly low-income shoppers in cities.
Dollar Tree has sold products at $1 for 35 years and was the last of the major dollar store chains to actually be a dollar store. (The company was called "Only $1.00" in the late part of the 20th century, before changing its name to Dollar Tree in 1993.)
Dollar Tree had started moving away from only offering goods for $1 in recent years, in part as a response to pressure on Wall Street to raise prices. Dollar Tree has lagged Dollar General and other discount chains.
In 2019, an activist investor took a stake in the company and pressed the chain to raise prices. The group ended its fight after Dollar Tree announced it planned to test different prices.
In September, Dollar Tree said it planned to begin selling items at $1.25 and $1.50 at some stores for the first time. It also said it would add $3 and $5 items to more stores, expanding on a prior strategy to offer these prices at select locations.
Since that announcement, a different activist investor built a stake in Dollar Tree and has tapped a former Dollar General CEO to push for changes at the company.
Although Dollar Tree said its decision to permanently raise prices was not a reaction to short-term inflation, one analyst was unconvinced.
"The pace of rollout, along with [the] engaged investor, Mantle Ridge, clearly suggests otherwise," Kelly Bania, an analyst at BMO Capital Markets, said in a note to clients Tuesday.
美元树（Dollar Tree）将价格提高了 25%。大多数商品将花费 1.25 美元
纽约（CNN 商业）美元树将很快成为 1.25 美元的树。
该公司——美国仅存的真正一元店之一——周二表示，到 2022 年第一季度，其大部分产品的价格将从 1 美元上调至 1.25 美元。这一变化表明低成本零售商面临压抑的压力通胀上升时期的物价。
Dollar Tree (DLTR) 在周二发布的季度收益报告中表示，其将价格永久提高至 1.25 美元的决定“并不是对短期或暂时的市场状况的反应”。
该公司表示，严格以 1 美元的价格销售商品阻碍了 Dollar Tree，并迫使其停止销售一些“客户的最爱”。提高价格将使 Dollar Tree 更灵活地重新推出这些商品，扩大其选择范围，并为其商店带来新产品和新尺寸。
Dollar Tree 还表示，提高价格将通过“缓解历史高位的商品成本增长”（包括运费和分销成本以及工资增长）来帮助公司提高利润率。
“现在是摆脱 1 美元价格限制的适当时机，”首席执行官迈克尔·威廷斯基 (Michael Witynski) 在一份声明中表示。
美元商店的终结
Dollar Tree 主要销售季节性商品、玩具、文具、家居装饰、厨具和派对用品。
它迎合了郊区的中等收入购物者，不像其更侧重农村的竞争对手 Dollar General (DG)。 Dollar Tree 旗下的 Family Dollar 主要针对城市中的低收入购物者。
一元树以 1 美元的价格销售产品已有 35 年，并且是最后一家真正成为一元店的主要一元连锁店。 （该公司在 20 世纪后期被称为“仅 1.00 美元”，之后于 1993 年更名为 Dollar Tree。）
近年来，Dollar Tree 开始不再只提供 1 美元的商品，部分原因是为了应对华尔街提高价格的压力。 Dollar Tree 落后于 Dollar General 和其他折扣连锁店。
2019年，一名激进投资者入股该公司，并施压该连锁店提价。在 Dollar Tree 宣布计划测试不同价格后，该集团结束了战斗。
9 月，Dollar Tree 表示计划首次在一些商店开始以 1.25 美元和 1.50 美元的价格出售商品。它还表示将向更多商店增加 3 美元和 5 美元的商品，扩大先前的策略，在特定地点提供这些价格。
自那次宣布以来，另一位激进投资者增持了 Dollar Tree 的股份，并聘请了一位前 Dollar General 首席执行官来推动该公司的变革。
尽管 Dollar Tree 表示其永久提高价格的决定并不是对短期通胀的反应，但一位分析师并不相信。
BMO Capital Markets 分析师凯利巴尼亚周二在给客户的一份报告中表示：“推出的速度以及 [the] 参与的投资者 Mantle Ridge 显然表明并非如此。”
