• Retail Dive

Family Dollar to roll out revamped stores and private brands

Dive Brief:

  • The retailer plans to renovate 250 Family Dollar stores this year and expand frozen and refrigerated sections at an additional 300 stores. New layouts will include expanded snack and beverage offerings, immediate consumption courts near checkout, more adult beverage products, a faster checkout process and more.

  • Dollar Tree CEO Bob Sasser told Supermarket News a brand called Home Line will replace Family Dollar-branded household products. Private label candies will now be under the name Katoomba Candy Co.

  • Dollar Tree is preparing to roll out new store layouts and private label brands across its Family Dollar discount chain, according to Supermarket News

Dive Insight:

After sales dropped, an ongoing problem that Family Dollar has experienced in recent times, parent company Dollar Tree is wise to try to do something big to reinvigorate its beleaguered chain. Nicer store environments could entice younger shoppers who seek grocery experiences. A recent NPD Group study revealed 29% of shoppers at the top dollar store chains are millennials from households earning $100,000 a year or more — spending power that Family Dollar should further capitalize on.

Dollar Tree hopes new layouts and private labels will entice new consumers. Early signs indicate shoppers are liking the changes. Sasser told Supermarket News customers have been responding well to cleaner stores with better merchandise.

Revamped private label lines also are a savvy investment, especially as other discount, traditional and natural and organic competitors work to expand their store brand portfolios. Shoppers no longer view private label products as "generic", and many choose their grocery stores based on the quality of its branded offerings.

Its unclear whether Dollar Tree will reformulate its products or simply refresh product packaging with new private label branding. Even if its the latter, a jazzed-up label design could drive sales and promote shopper perceptions of improved quality. Eventually, the retailer would be wise to invest in natural private label offerings and other premium product categories as these could help lure shoppers with serious spending power away from competitors.

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