Dollar Tree, the company that owns Family Dollar and its own Dollar Tree stores, has said it will close about 1,000 of its stores in the United States.
According to the company, 600 of its Family Dollar stores will close by the middle of 2024, and another 370 stores will follow over the next few years.
Not just Family Dollar stores but also 30 Dollar Tree stores are on the list to close, including some stores in Illinois. These closures will happen in the first wave of shutdowns and will continue over the coming years.
Store Closures Impact Local Communities
The retailer's group of brands is facing hard times as rising prices hurt shoppers' wallets with lower incomes. More customers are starting to compare prices at different stores to ensure they get the best deals. At the same time, the retailer is losing money because more people are shoplifting.
As Dominick Miserandino from RetailWire explained, the closing of these stores could be a major problem for some local areas.
In an interview with CBS News, Miserandino said, "These stores might be the only shopping option for the whole community in some places." He pointed out that these stores could also be one of the few places where people in the community can find jobs.
He stressed the importance of these stores, saying, "These communities rely on these stores."
In Illinois, two Family Dollar stores in Peoria are set to close, reports the Peoria Journal Star. This news is part of a larger announcement that includes store closures in other parts of the country, such as Tallahassee, Florida; Clearwater, South Carolina; Wichita, Kansas; and Middletown, New Jersey.
Most of these stores offer a big sale to clear out their inventory, with everything in-store at 50% off. Shoppers can find significant product savings as these locations prepare to close.
Also Read: Best Buy Joins Major Retailers in Observing Special Calendar Date with Store Closures
SNAP Cuts Deepen Challenges for Discount Stores
The cutback in benefits from the Supplemental Nutrition Assistance Program (SNAP) has left many families struggling, with some having $250 less to spend on food each month. Discount stores and companies that sell everyday items say they're feeling the pinch from this loss.
Jaqueline Benitez, who relies on SNAP benefits in California for her grocery shopping, was at a supermarket in Bellflower, California, on February 13, 2023. She's among the nearly 30 million Americans who received extra government help for food during the pandemic but are now facing reduced aid.
"Ongoing high prices and fewer government benefits are making things tough for the lower-income customers we serve," said Rick Dreiling, CEO of Family Dollar, during an analyst call on Wednesday.
Family Dollar plans to close 600 stores this year, and another 370 will shut down over the next few years as their leases end. Family Dollar has about 8,000 stores across the U.S. Dollar Tree, which owns Family Dollar, has also announced the closure of 30 stores.
While these closures are expected to boost the company's profits, they will likely create difficulties for Americans who already have limited shopping options.
Family Dollar stores are often located in areas without many supermarkets, large retailers, or other shopping choices.
After the announcement, Dollar Tree's stock dropped more than 13%, hitting its lowest point of the year during early Wednesday trading.
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