Dollar Tree is planning to close nearly 1,000 stores collectively between its namesake general discount stores and subsidiary chain, Family Dollar.
Family Dollar will close 600 locations in the first half of 2024 and 370 stores over the next several years as store leases expire, the company said Wednesday.
Dollar Tree, which bought Family Dollar for $8.5 billion in 2015, will also be closing 30 stores as leases expire.
“Our biggest problem right now is getting enough merchandise into the stores fast enough so the consumer can respond,” said CEO Rick Dreiling, adding that Family Dollar was continuing to be hurt by macroeconomic uncertainties.
Dollar stores have suffered in recent months as consumer spending habits have shifted, favoring e-commerce platforms such as Temu, the Chinese app that has ballooned in popularity for offering everyday must-haves on the app for as low as 99 cents.
In November, Dollar Tree — which operates more than 16,700 stores, including 8,400-plus Family Dollar locations — had said it would be reviewing its Family Dollar business, including potentially shutting down underperforming stores, to return to growth.
After deciding on nearly 1,000 store closures, the company said it took a $594.4 million charge for a portfolio optimization review and incurred a goodwill impairment charge of $1.07 billion, as well as $950 million in other asset impairment charges in the reported quarter.
Also on Wednesday, Dollar Tree reported a net loss of $1.71 billion, or $7.85 per share in the quarter ended Feb. 3, compared with a year-ago profit of $452.2 million, or $2.04 per share.
It expects 2024 sales between $31 billion and $32 billion, the mid-point of which is below the estimate of $31.65 billion, according to LSEG data.
Representatives for Dollar Tree did not immediately respond to The Post’s request for comment.
Recently, Family Dollar has also been plagued with health and safety concerns — including when the Food and Drug Administration said cinnamon sold by the deep-discount retailer was contaminated with high levels of lead.
Weeks earlier, Family Dollar pleaded guilty to selling goods at 400 stores across the Southeast that came from a rodent-infested warehouse. As a result, it will cough up a record $41.7 million in fines to the feds.
In 2022, the US Food and Drug Administration found “live rodents, dead and decaying rodents, rodent feces, urine and odors” at the company’s Arkansas warehouse that stored food, cosmetics, and medical devices, according to the Justice Department.
With Post wires.
This story originally appeared on NYPost
