Photo Courtesy of Food Business News/ Dollar Tree Inc.
According to an announcement made by the company on November 23, Dollar Tree will no longer have set prices at $1. The company will now raise its prices to $1.25.
Market Watch reported that the company said it has been able to sustain prices at $1 for 35 years and that this new change is not in response to inflation, as it has managed to hold costs in the past during inflationary periods.
This decision resulted from a company transformation plan that began with a testing process in the summer and was introduced in September.
Dollar Tree reported that the customer response to the increase in prices has been positive. Investors also positively responded when the company discussed the higher prices during its last earnings announcement in September.
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“[Customers] have also indicated they are seeing price increases across the market and that Dollar Tree is still providing the products they need at an undeniable value,” Dollar Tree said in a statement.
They added that the increase in prices is a permeant change for the company and not a result of “short-term or transitory market conditions,’’ as the $1.25 price increase allows the company to provide a vast range of merchandise which includes products that have been discontinued at the price of $1.
“Accordingly, we have begun rolling out the $1.25 price point at all Dollar Tree stores nationwide,” said Michael Witynski, Chief Executive of the company, in a statement.
“Lifting the one-dollar constraint represents a monumental step for our organization, and we are enthusiastic about the opportunity to meaningfully improve our shoppers’ experience and unlock value for our stakeholders,” Witynski said.
As of December, the increased prices are set to be in place for 2,000 Dollar Tree stores, with the rollout finishing during the first fiscal quarter of 2022.