Dollar trete sells Dollar of family for a billion dollars and end with its ten years merger With the company. Awaiting approval, Dollar Tree will sell the discount mark on the BRIGADE Capital Management and Macellum Capital Management Brigade Groups.
“The leadership and board of directors of Dollar Tree determined that a family dollar sale in Brigada and Macellum unblocked the best value for Dollar Tree shareholders and positions the family dollar for future success,” the company said in a statement, as Cnn.
What went wrong in the melting of Dollar Tree with the family dollar?
After Dollar Tree bought the family dollar for $ 9 billion in 2015, the discount brand store experienced struggles in the following years. Analysts said that Family Dollar, who is built to attend to families in low -income neighborhoods, fought due to the increase in prices and overexpansion. The company also obtained a negative reputation due to its disorderly stores. As the struggles continued, Family Dollar closed 900 stores in 2924 and went on sale.
Neil Saunders, an analyst of Globaldata Retail, told the customers (by CNN) that this “closes the book in a sad and trouble -trouble chapter”.
“The dollar tree chewed much more than you could chew,” Saunders said, according to CNN.
Similar to other companies that fight due to inflation, the family dollar has been forced to increase operational costs, which hinders purchases for its customers. The company also faces additional challenges, as Donald Trump imposes tariffs on imported goods.
Why do dollar stores fight in the current economy?
Value stores such as the dollar and the general dollar face significant challenges, as low -income families struggle to pay for basic needs.
“Our clients continue to denounce that their financial situation has been worse in the last year, as they have been adversely affected by ongoing inflation,” said Todd Vasos, CEO of Dollar, Todd Vasos, according to a earnings call, according to CNN. “Many of our clients report that they only have enough money for basic basics, with some pointing out that they have had to sacrifice even according to the needs.”
Dollar Tree also announced last year that the company could have to make a series of adjustments, including the closures of the store, as the rates cause a significant challenge. About 40% of dollar tree products are based on imported products, by CNN. After selling items for $ 1 for decades, Dollar Store increased its base price to $ 1.25 by 2021.
