"Tapping into the one certainty in the retail space, everyone loves a bargain, which brings us to today's case subject, Dollar Tree. For 35 years, Dollar Tree built its entire identity around one simple, powerful promise. Everything in the store costs just one dollar. That fixed price point, not only defined the brand, but also created a unique shopping experience and a strong sense of value for customers."
"Everything in the store costs just one dollar. That fixed price point, not only defined the brand, but also created a unique shopping experience and a strong sense of value for customers. But in 2021, amid rising inflation, global supply chain pressures, and activist investor demands, Dollar Tree made a seismic shift. It raised prices to $1.25. Analysts were divided. Some said it was necessary for survival. Others called it one of the worst decisions in retail history."
Frank Winfield Woolworth opened the first 5-and-10-cent store on June 1, 1879, in Lancaster, Pennsylvania. Dollar Tree built its identity over 35 years around a single fixed price: everything costing one dollar. The fixed $1 price point defined the brand, created a treasure-hunt shopping experience, and conveyed a strong sense of value to customers. In 2021, Dollar Tree raised prices to $1.25 amid rising inflation, global supply-chain pressures, and demands from activist investors. Analysts reacted with divided opinions, with some calling the change necessary for survival and others deeming it a major retail misstep.
Read at Harvard Business Review
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