Dollar Tree will begin selling most products for $ 1.25 at all stores bearing its name to offset the impact of rising fares and other pandemic challenges.
Retailers said Tuesday that the new price range, which will be fully rolled out by the first quarter of 2022, will allow them to return to the “past gross margin” of 35% to 36% next year.
Due to the high prices, CEO Michael Witynski said discount stores can expand their assortment, introduce new products and sizes, and revive products that “promote traffic.”
Despite COVID-19 restrictions, Dalarama sales increased 13% in the last quarter
Known for selling everything from make-up to household items at a price of $ 1, Dollar Tree announced in September plans to add a new price of over $ 1 at some stores.
As a result of the third quarter, price increases are good, and the outlook for the first quarter shows that cargo headwinds are worse than expected, according to Evercore analyst Michael Montani.
Rising fares due to global supply chain disruptions have squeezed the profits of most companies in the United States, further putting more pressure on many retailers who are already working on high labor and raw material costs.
Canada’s annual inflation surges 4.7% in October
Dollar Tree said fares were significantly higher than expected in the third quarter and this is expected to continue in the short term.
Earnings per share for the fourth quarter are forecast to be $ 1.69 to $ 1.79. Analysts expected an average of $ 1.75, according to Refinitiv IBES data.
The company’s net income fell to $ 216.8 million (96 cents per share) in the quarter ended October 30, down from $ 330 million ($ 1.39 per share) in the year-ago quarter. ..
Net sales were up 3.9% to $ 6.42 billion, surpassing previous expectations of $ 6.41 billion.
The company’s share price, based in Chesapeake, Virginia, rose 5.6% in the morning trading.
(Report by Mehr Bedi in Bangalore, edited by Shinjini Ganguli)
No more dollars: dollar tree price increase from next year-nationwide
Source link No more dollars: dollar tree price increase from next year-nationwide