Dollar Tree will take over nearly half of the shuttered 99 Cents Only stores in the United States after the latter declared bankruptcy last month.
The retail behemoth, which also owns the Family Dollar brand, announced that it had taken over the leases for 170 99 Cents Only locations in Arizona, California, Nevada and Texas.
The move comes at a turbulent time in the dollar store industry, as inflation has stalled a period of rapid growth in recent years.
Dollar Tree announced in March that it would close 600 of its Family Dollar store locations this year and 370 more over the next several years as store leases expire. A further 30 Dollar Tree locations will also close, the company said.
Then in April, 99 Cents Only filed for bankruptcy and closed all of its 370 locations.
Dollar Tree said Wednesday that it had acquired the intellectual property of 99 Cents Only but will operate them under its own brand.
The rapid expansion of dollar stores across the US in recent years has been a retail phenomenon.
The 2008 recession sparked their exponential growth as families searched for ways to reduce their household budgets. The cheap, packaged food they offered met that need.
Between 2018 and 2021, around half of all retail stores that opened in the US were dollar stores, according to research by the University of Toronto. Today, there are more dollar stores than Walmarts, CVS, Walgreens, and Targets combined.
That has made competition between the giants fierce and put a premium on building as large a footprint as possible.
Despite it being in their name, the stores have long given up on selling items for a dollar — and there are subtle differences between the brands. Family Dollar tends to focus on high-poverty neighborhoods, for example, while Dollar General and Dollar Tree aim for lower middle-class and middle-class areas.
Dollar Tree, a Fortune 200 Company, operates more than 16,000 stores in the US and Canada.
The purchase will allow Dollar Tree to rebuild after the closures announced earlier this year.
Michael Creedon, Jr., Dollar Tree’s Chief Operating Officer, said in a statement that the purchase of the 99 Cent Only stores “complements our existing footprint and will provide us access to high quality real estate assets in premium retail centers, enabling us to rapidly grow the Dollar Tree brand across the western United States, reaching even more customers and communities.”
“Dollar Tree looks forward to welcoming customers from 99 Cents Only Stores as early as fall 2024,” he added.
Dollar stores aren’t the only retailers feeling the pinch.
Iconic northeast chain Stop & Shop is also shuttering an unknown number of stores. The chain is closing “select underperforming store locations” to “ensure the long-term health and future growth” of the company, a spokesperson for Stop & Shop said in a statement to The Independent.
A host of major retailers are also cutting prices in an effort to bring back customers who are tightening their belts due to inflation. Walgreens announced this week it would slash prices across the store, joining Walmart, Amazon and Target in doing the same.
