Carbondale Family Dollar is closing to make way for Dollar Tree |

Carbondale Family Dollar is closing to make way for Dollar Tree

Thomas Phippen
Glenwood Springs Post Independent
Store closing sign hangs at the entrance to Family Dollar in Carbondale. The store is being converted into a Dollar Tree.
Glenwood Springs Post Independent

Carbondale’s Family Dollar store has a big sign that says it’s closing. But it will only be closed temporarily while the business renovates and becomes a Dollar Tree, according to company officials.

A large sign on the main entrance to the store says “store closing,” and a smaller sign on the door says the location is converting into a Dollar Tree.

“The Family Dollar located at 813 Hwy 133, Carbondale …will be converted into a Dollar Tree store. The location is briefly closed and is scheduled to reopen in mid-April,” a Dollar Tree, Inc., spokesperson said in a statement.

Many of the current staff members at Carbondale Family Dollar are in training for the new opening, according to a clerk working at the store.

Dollar Tree, Inc., merged with Family Dollar and acquired most of its stores in 2015, and this year plans to re-brand 200 stores across the country, according to a March shareholder report.

Since the 2015 merger, Family Dollar stores appear to have weighed heavily on Dollar Tree Inc.’s earnings. The last quarter of 2018 saw the strongest sales numbers for Family Dollar as the company continues efforts to turn the stores around.

The turnaround of Family Dollar stores includes renovation, re-branding, or outright closure of under-performing stores. In the last three months of 2018, 85 Family Dollar stores were closed across the country.

“Approximately 200 Family Dollar stores will be re-bannered to Dollar Tree, and we plan to close as many as 390 Family Dollar stores this year,” Gary Philbin, CEO of Dollar Tree, Inc., said in the quarterly shareholder report.

The biggest distinction between Family Dollar and Dollar Tree stores is that the latter are true dollar stores, with all items priced at $1 or less. Family Dollar, while still a discount retailer, has a range of merchandise sold for more than a dollar.

At least one of the corporate shareholders suggests that capping all merchandise at one dollar might be a losing prospect going forward.

“Dollar Tree has kept its prices at $1.00 since its founding thirty years ago, despite the fact that $1.00 in 1986 is worth approximately $2.30 today, due to inflation,” Jeffrey Smith of Starboard Value LP, one of Dollar Tree’s largest shareholders, wrote in a letter to the CEO and board of directors in January.

“However, the value that Dollar Tree has offered its customers has deteriorated because of the need to fit everything into a $1.00 price point,” the letter continued.

The Starboard Value letter suggests offering items at a few new price points, like $1.25, $1.50,  and $2.00, which would open up more product offerings and still be “far fewer price points than are offered in Family Dollar stores today.”