Dollar Tree Is Abandoning Its Roots And Selling Food For More Than $1

With a name like Dollar Tree, you might expect to walk into the store and be able to purchase any and all items for just one dollar. Unfortunately, inflation exists, and in order for stores like Dollar Tree to compete, prices need to increase with the times. The brand recently announced that it plans to roll out products that cost $3, $4, and $5 to its stores later in 2023, effectively altering the meaning behind its "Dollar Tree" name.

In June 2023, Dollar Tree held its annual investor conference, where it announced new solutions to inflation as well as how to break into new markets and products; the solutions for both are to offer items with increased price tags. "From $2.01 to $5 [price points], there's another huge market that is untapped for us," Dollar Tree's chief merchandising officer, Rick McNeely, said at the conference, per Grocery Dive. He cited branded ice cream and various proteins as potential Dollar Tree food products that the brand once couldn't sell due to their higher price points, but now can.

While the chain plans to add new items at higher price points, it also increased many of its own $1 items to $1.25 back in late 2021 as a result of general rising costs. Of its nearly 9,000 stores, prices rose at around 2,500 of them; CNN reported that the move led to backlash and initial customer drops of as much as 12.2% during the first month of rollout. However, CEO Rick Dreiling made it clear during the 2023 conference that the backlash "is behind us" as the brand moves forward with these new prices.

There is one positive to these new $3, $4, and $5 prices — some products will be reduced in cost. As a result of the higher-end product prices, Grocery Dive reports that up to 400 other products sold in Dollar Tree stores will roll back from $1.25 to $1. Plus, the new price points are meant to create a more well-rounded shopping experience, meaning customers will be able to purchase a greater variety of products in their stores, which is the brand's ultimate goal. Earlier this year, the constricted price point forced Dollar Tree to stop selling eggs, a problem it could potentially avoid with higher prices.