Family Dollar closing nearly 400 stores, rebranding 200

Family Dollar is plannning to close nearly 400 stores. CORNELIUS FROLIK / STAFF
Family Dollar is plannning to close nearly 400 stores. CORNELIUS FROLIK / STAFF

Nearly 400 Family Dollar stores will shut down as parent Dollar Tree Inc. attempts to turn the brand around.

The company announced today that it will close as many as 390 Family Dollar stores and rebrand another 200 as Dollar Tree.

The company has been aggressive about restructuring its portfolio recently. In the last quarter of 2018, 84 Family Dollar stores closed and the company announced plans to renovate 1,000 in 2019. The renovated stores will include $1 Dollar Tree merchandise sections.

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Family Dollar has struggled since Dollar Tree bought the company in 2015 and has impacted the success of Dollar Tree. The brand recorded a $2.73 billion goodwill impairment charge against the value of the Family Dollar chain because the financial statements exceeded the fair value of the company.

Tariffs have also had a strong effect on dollar stores like Dollar Tree and Family Dollar that can’t raise the price of products, but Gary Philbin, president and CEO of Dollar Tree, said merchants have come up with a plan for the year that overcomes most of the effects.

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Despite the concerns, sales remained strong at Dollar Tree. Net sales increased 4.2 percent in the fourth quarter of 2018 from the same period in 2017. Same-store sales at Dollar Tree increased 3.2 percent and Family Dollar’s saw a jump of 1.4 percent.

“Sales for the quarter were strong,” Philbin said. “Our results demonstrate the increasing strength of the Dollar Tree brand, and accelerated progress on the Family Dollar turnaround, as Family Dollar delivered its strongest quarterly same-store sales growth of the year.”

The Dayton area has more than 10 Family Dollar stores. There is no word what local locations will close.

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