TWO more discount stores have announced they are closing as shoppers mourn major changes to Dollar Stores across the nation.
In Peoria, Illinois, two Family Dollar locations have declared their closing dates after their parent company decided to close a total 1,000 stores of their namesake nationwide.
Stores located at 3116 N. Sterling Ave and 820 NE Jefferson St. are set to close up after being labeled as “underperforming,” reports the Journal Star.
“EVERYTHING MUST BE SOLD!” reads a sign posted at the entrance of one of the locations.
A large banner simply stating “Store Closing” spans a large portion of an exterior, parking lot facing wall.
While Peoria will still be left with three other Family Dollar locations, these closings reflect a larger pruning for the company.
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On March 13, Dollar Tree announced that 1,000 of its Family Dollar locations would be closing as they review the performance of stores across the country.
The majority of stores closing will be shut down by the end of 2024, with others following in the next few years.
“As a result of this review, we plan on closing approximately 600 Family Dollar stores in the first half of fiscal 2024. Additionally, approximately 370 Family Dollar and 30 Dollar Tree stores will close over the next several years at the end of each store’s current lease term,” the company said in the press release.
Chairman and Chief Executive Officer, Rick Dreiling, said that this decision comes as the company shifts strategy, highlighting positives as the company’s profits underperformed.
“We finished the year strong, with fourth-quarter results reflecting positive traffic trends, market share gains, and adjusted margin improvement across both segments,” he said.
“While we are still in the early stages of our transformation journey, I am proud of what our team accomplished in 2023 and see a long runway of growth ahead of us.
“As we look forward in 2024, we are accelerating our multi-price rollout at Dollar Tree and taking decisive action to improve profitability and unlock value at Family Dollar.”
The company’s quarterly revenue failed to meet Wall Street expectations at $8.46 billion compared to the estimated $8.66 billion.
Dollar Tree reported a profit of $452.5 million last year, it has now reported a net loss of $1.71 billion in the fourth quarter with market shares dropping 8% after the results of its fourth quarter.
The company has implemented a number of changes within the past year in the name of growth and fulfilling customer needs.
COMPETITOR GROWTH
As Dollar Tree struggles and re-evaluates its strategy, its competitor Dollar General has announced its own changes.
In their own fourth quarter earnings call, Dollar General announced its plans to open 800 more new stores, remodel 1,500 locations, and relocate 85 stores this year.
The company reported that its full-year net sales up by 2.2% for a total of $38.7 billion.
Part of their changes will incorporate a reduction of self-checkouts following theft issues.
The company also announced that at 4,500 stores, self-checkout will be limited to five items or less.
“We believe these actions have the potential to have a material and positive impact on shrink,” Dollar General’s CEO Todd Vasos said.
Currently, there are 14,000 of 20,000 Dollar General stores contain self-checkouts, but the company’s stance is that human connection is paramount to customer experience.
“We believe there is truly no substitute for an employee presence at the front end of the store to greet customers and provide excellent customer service, including at checkout,” Vasos said.
In a compromise, the store will be installing hybrid, AI-assisted checkout lanes in 9,000 locations.
Vasos explained that hybrid self-checkout is intended “to drive traffic first to our staffed registers, with assisted-checkout options available as second or third options to reduce lines during high-volume times.”
“That should immediately do a lot for us,” he concluded.
SELF-CHECKOUT CHANGES ACROSS RETAIL
Other retailers are also changing their approach to self checkout as Dollar General annoucnes new AI led lanes.
Walmart shoppers were shocked when self-checkout lanes at various locations were made available only for Walmart+ members.
Other customers reported that self-checkout was closed during specific hours, and more cashiers were offered instead.
While shoppers feared that shoplifting fueled the updates, a Walmart spokesperson revealed that store managers are simply experimenting with ways to improve checkout performance.
One bizarre experiment included an RFID-powered self-checkout kiosk that would stop the fiercely contested receipt checks.
However, that test run has been phased out.
At Target, items are being limited at self-checkout.
Last fall, the brand surveyed new express self-checkout lanes across 200 stores with 10 items or less for more convenience.
As of March, this policy has been expanded across 2,000 stores in the US.
