Nov. 24, 2021

It’s not exactly Dollar Tree anymore.

The national retailer that has priced nearly all merchandise at $1 for 35 years is increasing it across the board to $1.25.

The new price point is permanent and not a reaction to short-term market conditions, the company said in its quarterly earnings report.

“We experienced a strong finish to the quarter as shoppers are increasingly focused on value in this inflationary environment,” Michael Witynski, president and CEO, said in a statement.

“Our Dollar Tree pricing tests have demonstrated broad consumer acceptance of the new price point and excitement about the additional offerings and extreme value we will be able to provide. Accordingly, we have begun rolling out the $1.25 price point at all Dollar Tree stores nationwide.”

The price increase will apply to a majority of Dollar Tree’s assortment and enhance the company’s ability to expand its offerings, introduce new products and sizes, and provide more daily essentials, it said.

Additionally, this new pricing strategy enables the company to reintroduce many customer favorites and key traffic-driving products that previously were discontinued because of the constraints of the $1 price point.

The new price point will enable Dollar Tree “to return to its historical gross margin range by mitigating historically high merchandise cost increases, including freight and distribution costs, as well as higher operating costs, such as wage increases,” it said.

Dollar Tree plans to introduce the new price point at more than 2,000 stores in December and complete the rollout by the end of the first quarter of next year.

“Lifting the $1 constraint represents a monumental step for our organization, and we are enthusiastic about the opportunity to meaningfully improve our shoppers’ experience and unlock value for our stakeholders,” Witynski added. “Guided by Dollar Tree’s same founding principles, we will be relentless in our commitment to offer our customers the best value possible.”