Dollar Tree (DLTR) has passed the buck: It's now a buck and a quarter.
And if social media is any indication, consumers are not happy about the discount retailer's planned price increase.
The Chesapeake, Va., company said in November that it planned to roll out price increases that will take its midpoint to $1.25.
Dollar Tree Makes a Monumental Move
At the time Chief Executive Michael Witynski called the price hike a "monumental step."
"Our Dollar Tree pricing tests have demonstrated broad consumer acceptance of the new price point and excitement about the additional offerings and extreme value we will be able to provide," Witynski said.
Consumer acceptance seemed to be decidedly lacking on Twitter.
"I think Dollar Tree changing their prices from $1 to $1.50 was truly my last straw…" one person commented.
"BITCH! dollar tree really is $1.25 now, im appalled!" another declared.
"They need to change the name of Dollar Tree and name it 'A Dollar and Sum,'" was another response.
Dollar Tree unveiled plans in late September to test the sale of merchandise priced at $3 and $5, alongside its traditional $1 offerings, in 500 so-called "Dollar Tree Plus" stores by year's end, with another 1,500 planned for fiscal 2022.
Some Dollar Tree Shoppers Understand
Some shoppers were more understanding about the retailer's decision.
"After 35 years the price went up," one person tweeted. "It was going to happen. I know it's hard on some people but we had a store in the area have all of it's employees walkout over wages and so they raised wages in the stores in the area."
Last week. Truist analyst Scot Ciccarelli showed some love for Dollar Tree as he kicked off coverage of the company with a buy rating and $162 price target, according to the Fly.
The analyst said that despite several years of disappointing performance and concern about rising inflationary pressures on low-to-middle income consumers, Dollar Tree's recent price increase will result in a "sizable" acceleration in sales and profit.
Dollar Tree said in a statement Tuesday that "we have had a very positive response from the overwhelming majority of our customers around the $1.25 price point and the extreme value and broader product selection it has enabled, especially in these inflationary times."
"Customer feedback to date has confirmed the extensive research we conducted prior to the launch," the story said, "We look forward to providing more details on this initiative during our next earnings call."
The company is scheduled to report earnings in March.
December Inquiry From Activist Mantle Ridge
In December the activist investment from Mantle Ridge proposed a full new slate of directors to Dollar Tree’s board.
The New York firm, which Reuters reported called for a review of the retailer's business strategy, also was calling on the retailer to hire Richard Dreiling, former CEO at Dollar General, as a senior executive.
Mantle Ridge in December reported that it held 5.7% of Dollar Tree.
Dollar Tree's board is up for reelection at the 2022 annual meeting, Reuters reported.
Dollar Tree had responded hard to Mantle Ridge. The retailer said it met with the firm and "Mantle Ridge was unable to articulate ways to improve our business and strategy, and instead came with outdated information and with a predetermined settlement demand."
The board "is unanimous that Mantle Ridge’s demand is unwarranted, especially given our increasingly strong performance from our strategic initiatives underway," Dollar Tree said.
At last check Dollar Tree shares were off 2% at $128.27.
