Dollar Tree makes it official: Items will now cost $1.25

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Faced with rising costs of freight and freight, discount retail chain Dollar Tree says it will increase prices to $1.25 for most of its products.

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NEW YORK – Faced with rising costs of goods and merchandise, discount retail chain Dollar Tree said on Tuesday it would increase its prices for most of its products by up to $1.25.

Dollar Tree said the reason for raising its price to $1.25 was not due to “short-term or temporary market conditions” and added that the price increase was permanent. Higher prices will allow the company to face higher trading cost growth as well as higher operating costs, such as wages, it said.

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“(Dollar Tree) believes this is an appropriate time to move away from the constraints of the $1.00 price point in order to continue to offer immense value to customers,” the company said in a statement.

Dollar Tree was one of the last true “dollar stores,” as most of its competition moved away from that price point.

The company, which is based in Chesapeake, Virginia, said in September that it was testing higher prices at select stores. On Tuesday, it said it would introduce the new price point in more than 2,000 additional Dollar Tree stores in December and complete the rollout to all of its stores by early next year. The company has about $8,000 tree stores.

CEO Michael Wittensky said he expects Dollar Tree customers to remain loyal.

“Its shoppers believe that at $1.25, it’s still going to be an undeniable value, because what they’re seeing in the market is an undeniable value,” Wittensky said on a call with industry analysts. Is.” “And they know Dollar Tree hasn’t raised its price in 35 years, so they’re giving us credit.”

The company’s stock rose 9.2% on Tuesday following the announcement, which was combined with the company’s quarterly earnings. Citigroup analysts called the earnings “disappointing” but said investors are seeing the company past earnings, ultimately driving up prices.

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