It looks like moms and dads that are looking for a good bargain at a family-friendly store will have one less retailer to count on. Family Dollar is closing about 390 stores nationwide.
The news comes as a surprise for many families who frequent their local Family Dollar store for the best bargain buys when it comes to everyday and household products. The variety store chain has over 8,000 locations and is the second largest retailer of its type in the nation. Family Dollar stores can be found in every state except Alaska, Hawaii, Oregon, and Washington.
According to CNN, Family Dollar made the announcement this week and explained that they are looking to “reposition” themselves in the market. In addition to closing 390 stores, they are looking to change the name of 200 stores while also rising prices in some of their namesake locations.
Even though many budget-conscious moms will be shocked to hear the news, it doesn’t come as a surprise to investors. That’s because Family Dollar has been struggling in sales, while its stock price has slipped recently. The fact that Dollar Star's investment in Family Tree hasn't been fruitful hasn't helped company forecasts either.
"Dollar Tree significantly overpaid for Family Dollar, and this business is proving to be a meaningful distraction," Jeffrey Smith, CEO of Starboard Value, wrote to the company in January, via CNN. "The underperformance at Family Dollar since the acquisition has persisted long enough."
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Happy Monday guys! It’s @ijeomakola here and I’m going to be taking over the Family Dollar account all week to share with you a fun #springmakeup look I created using products from the beauty section that just re-launched at your local store! Come along with me as I check out what’s new, what’s trending, and what the best deals are on beauty! A little bit about me: I’m a doctoral student (aka nerd) and lifestyle blogger based in NJ (the part of Jersey that’s a hop, skip, and jump away from New York City), but I was born in Nigeria! I’d love to know where you’re from - let me know in the comments! #FDbeautiful
Family Dollar’s sister store Dollar Tree, meanwhile, has stated that it will test charging more for its products. The Dollar Tree bought rival Family Tree back in 2015 for $9.2 billion dollars. Investors have even been pressuring the company to discontinue some Family Dollar lines and start putting more emphasis and promotion on Dollar Tree merchandise instead.
Family Dollar has been the go-to store for families both small and large for years. Some of the bargain-shopping items that can be found in their stores include greeting cards, party supplies, notebooks, store containers, season décor and more. Back in 2014, the company even tested out alcohol sales in 200 of its stores across the nation. The stores also sell jumbo packs of diapers and baby products and bargain prices, making it an attractive one-stop shop for moms and dads.