Dollar Tree plans to close 390 Family Dollar stores.
The CEO of the company said the number of closings of underperforming stores may change, depending on the company’s ability to gain rent concessions from landlords. The news came with the company’s earnings report.
Landlords have been squeezed by demands for rent concessions at a time when large retailers like Payless Shoes are closing their doors and others seek to nullify leases through bankruptcy filings.
Another 200 Family Dollar stores will be converted to Dollar Trees, with plans calling for 350 new Dollar Tree and 200 new Family Dollar stores.
The Chesapeake, VA company will renovate at least 1,000 Family Dollar stores.
The company has maintained separate brands after acquiring smaller Family Dollar in 2015.
The closings amount to a tiny percentage of the company’s nearly 15,000 stores.
Dollar Tree operates under both of its bands in Delaware.
Dollar Tree CEO Gary Philbin stated, “Our Dollar Tree business has continued to perform extremely well. It’s a concept our customers love, as validated by our streak of 44 consecutive quarters of comp sales growth. We are confident we are taking the appropriate steps to reposition our Family Dollar brand for increasing profitability as business initiatives gain traction in the back half of fiscal 2019. Improving the consistency of execution and optimizing our real estate portfolio will contribute to a meaningful improvement in our shoppers’ in-store experience and store traffic. We believe we are well-positioned to capture the significant opportunity ahead of us as we focus on creating and driving value for our shareholders.”