Dollar Tree reported that the reason for raising its prices to $1.25 was not due to “transient or short-term market conditions” and specified that growth is permanent, Higher prices will also allow the company He said rising business costs as well as higher operating expenses such as wages have to be faced.
“(Dollar Tree) believes the time has come to move away from the $1 price barrier to continue to provide exceptional value to customers,” the company said in a statement.
Dollar Tree was one of the last true “dollar stores” after most of its competitors moved away from that price level.,
The Chesapeake, Virginia-based company reported in September that it was testing price hikes at some stores. On Tuesday, it said it would introduce new pricing at more than 2,000 new Dollar Tree stores starting in December and complete all of its stores early next year.
the company about 8,000 stores dollar Tree.
CEO Michael Wittensky said he expects Dollar Tree customers to remain loyal.
“Its buyers believe that at $1.25 it is still an undeniable value compared to what they see in the market,” Wittensky said in a call with industry analysts.
and they know that Dollar Tree hasn’t raised its price in 35 years, so they give us credit”.
Shares of the company rose 9.2% on Tuesday following the announcement, which coincided with the company’s quarterly results.
(with AP info)