Dollar Tree Garnering Grocery and Restaurant Customers with MEALS

The incremental growth in fresh frozen foods can be linked to Dollar Tree according to Steven Johnson, Grocerant Guru® at Tacoma, WA based Foodservice Solutions®. So, consider that Dollar Tree has over 15,175 related stores.  By adding fresh food, Dollar Tree is creating quite a conundrum for both grocery stores and fast food outlets according to Johnson.

Dollar Tree is wooing shoppers with value prices on groceries and art supplies, propelling the retailer to its 12th consecutive quarter of comparable-store sales exceeding 2%.

Dollar Tree President and CEO Gary Philbin recently stated “that the discount retailer’s assortment of more consumables and art supplies, renovations of old stores, expansion of its Snack Zone feature, and launch of the Dollar Tree Plus store format have driven top-line sales and transaction counts at both the Dollar Tree and Family Dollar banners. During the quarter, Dollar Tree saw increases in both traffic and ticket, with traffic slightly outpacing the ticket increase.” Chain restaurants wish that they could see an increase in traffic.  

Philbin continued “during Q3, the company expanded its Snack Zone feature to more than 1,000 stores. The Snack Zone is designed to provide customers with a compelling assortment of immediate-consumption products at the $1 price point to drive incremental sales, Dollar Tree noted. The feature spans categories such as cold beverages, candy, snack cakes, salty treats and other groceries.

Get this, during the earnings call, Philbin remarked that the retailer is selling so much lower-margin food and other consumables that the sales are putting pressure on margins. During the quarter, same-store sales at the company increased by 2.5%: Same-store sales for the Dollar Tree banner increased by 2.8%, while same-store sales for the Family Dollar banner increased by 2.3%. 

Invite Foodservice Solutions® to complete a Grocerant Program Assessment, Grocerant ScoreCard, or for product positioning or placement assistance, or call our Grocerant Guru®.  Since 1991 www.FoodserviceSolutions.us  of Tacoma, WA has been the global leader in the Grocerant niche. Contact: Steve@FoodserviceSolutions.us or 253-759-7869