News Feature | June 6, 2017

Dollar Tree Rolls Out New Family Dollar Store Layouts And Private Label Brands

Christine Kern

By Christine Kern, contributing writer

Family Dollar IP Systems

Home Line and Katoomba Candy Co. are among the new offerings.

Dollar Tree is preparing to roll out new store layouts and private label brands across its Family Dollar discount chain as part of its recovery plan, according to Supermarket News. According to Dollar Tree CEO Bob Sasser, a brand called Home Line will replace Family Dollar-branded household products, while private label candies will now be under the name Katoomba Candy Co. 

Additionally, Dollar Tree announced plans to renovate 250 Family Dollar stores this year and to expand frozen and refrigerated sections at an additional 300 stores. New layouts will include expanded snack and beverage offerings, immediate consumption courts near checkout, more adult beverage products, a faster checkout process, among other changes.

Discount retailers like Dollar Tree and Dollar General have been fighting slumping sales and increasing competition from big box stores and other retailers. A recent NPD Group study revealed 29% of shoppers at the top dollar store chains are millennials from households earning $100,000 a year or more — spending power that Family Dollar should further capitalize on.

Last year, competitor Dollar General began targeting lower-income customers in hopes of boosting customer traffic with price cuts, as Innovative Retail Technologies reported. Dollar General cut prices by 10 percent on average on approximately 450 of its best-selling items across 2,200 stores.

Last spring, Dollar General also outlined plans to add approximately 1,000 new stores over the course of fiscal 2017, growth that falls in line with its model of 6-8 percent increase in square footage, as well as plans to relocate or remodel 00 existing locations, according to Innovative Retail Technologies. Plans for growth also included the addition of small, urban locations designed to meet the needs of busy, metropolitan shoppers.

As competition for sales increases, retailers are become more focused on initiatives that will draw customers into their stores and win their loyalty over time. Comparable-store sales at Family Dollar declined by 1.2 percent during the fiscal first quarter, while sister chain Dollar Tree posted positive 2.5 percent comps, according to officials who reviewed the financial results. The combined retailers posted 0.5% comps for the quarter, which ended April 29.

Dollar Tree CEO Bob Sasser told Supermarket News that while customers have been responding to cleaner and better merchandised Family Store stores, “there is still a lot of work to be done” to fix the ailing banner.