Dive Brief:
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Major changes for Family Dollar are likely after its acquisition by Dollar Tree is complete. The retailers said Wednesday that is expected to be by April 27.
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Some 300 Dollar Tree stores are likely to be closed as stipulated by the Federal Trade Commission’s approval of the companies’ merger. Otherwise, some Family Dollar stores will become Dollar Tree stores and vice versa, depending how each might fare in a given area, according to Dollar Tree CEO Bob Sasser.
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Sasser also said that Family Dollar will undergo significant changes to merchandising in an effort to boost profit margins.
Dive Insight:
Things are upbeat at these two retailers as the hard work begins to combine their fortunes. Dollar Tree CEO Bob Sasser said the company expects a lower full-year earnings outlook thanks to ongoing acquisition costs, but expressed confidence in the merged company’s prospects.
“While their reported results have not been stellar, we acknowledge that they have been operating through unique circumstances with great uncertainty regarding the future of the Family Dollar business,” Sasser on the company’s earnings call Wednesday. “Over time, we will reduce costs through shared services.”
Family Dollar reported a same-store sales increase of 1.7% over a two-month holiday period. Dollar Tree, meanwhile, reported Q4 sales increased 11%, boosted by demand for party supplies and household items over the holidays.
