Though the recession is increasingly hoped to be a fading horror, American retailing is still far from a picture of total health.\u00a0 While unemployment and hiring statistics seem to be on the upswing and building has shown considerable growth despite occasional negative indicators, retailing statistics from the most recent holiday season were notably disappointing.\u00a0 To this, many retailers are essentially shrinking at least parts of their brick and mortar platforms.<\/p>\n
Many prominent retailers continue to produce plans which fundamentally cut back on typical recent annual expansions.\u00a0 Late last summer Family Dollar announced plans to open 500 new locations for the then coming fiscal year.\u00a0 This as the company was anticipating the grand opening of its 8,000th<\/sup> store, from the base of its fiscal year ending count of 7,916 as of August 31, 2013.\u00a0 That 8,000th<\/sup> opening actually took place less than six weeks later in October.<\/p>\n Obviously, there are few retailers that have the vision, much less the need, to open 84 new locations in less than a month and a half, especially with the effects of the recession lingering on. \u00a0\u00a0However, this rate of expansion was merely par for the course for Family Dollar in recent years.<\/p>\n During the decade before the recession, Family Dollar embarked on a program of major in-store investments in renovations by installing refrigerators and freezers throughout its considerable universe of stores.\u00a0 The company was announcing its intent to be a player in the grocery market by establishing itself as a dealer in perishables while expanding its overall merchandising in food.<\/p>\n The company saw this as a means to capture market share from struggling traditional grocers, while increasing the frequency of customer visits as well as the average amount of money they left behind per visit.\u00a0 On this quest, Family Dollar was not alone.\u00a0 Its nationwide dollar retailer brethren, Dollar General and Dollar Tree, pursued the same destiny.<\/p>\n According to Chain Store Guide\u2019s<\/strong> database of Discount Stores & Specialty Retailers<\/a>, during the years leading to the recession, Family Dollar aggressively opened new locations at the rate of around 400 per year.\u00a0 That slowed down in fiscal 2007, just before the recession officially hit, to 130.\u00a0 The next year that growth figure was announced to be 170 as the recession became official.<\/p>\n For fiscal 2009, Family Dollar netted just<\/em> 55 new locations.\u00a0 This however was quite a solid number as most of retailing was suffering an economy that had taken a stunning turn for the much worse.\u00a0 \u00a0Most chains were significantly cutting expansion plans, if not contracting their store counts significantly.<\/p>\n Then the three major, national dollar chains embarked on patterns of expansion that would have seemed bold in times of abundant prosperity.\u00a0 For its part, Family Dollar grew with 130 additional locations for fiscal 2010.\u00a0 During the next year the company added 386 locations.\u00a0 Then Family Dollar expanded by 271 followed by meeting a whopping growth plan by adding 474 locations by the summer of 2013.\u00a0 This lead to the company\u2019s plan to add 500 locations for the current year, as it quickly passed its 8,000th<\/sup> location milestone.<\/p>\n Suddenly, as most retailers anticipated a kind of post-recession holiday season, Family Dollar began to experience disappointing quarterly financials.\u00a0 This quickly led to the stunning dismissal of its COO Mike Bloom.\u00a0 The departure was accompanied by stories of significant changes in the company\u2019s merchandising plans.<\/p>\n However, shortly after this, came even more shocking company news.\u00a0\u00a0 Just last month, the industry\u2019s perennial number two dollar retailer, announced the decision to close 370 \u2018underperforming\u2019 stores.\u00a0 Accompanying this grim news was the announcement that the company would scale back its plan to open 500 stores during fiscal 2015.\u00a0 The company now anticipates opening between \u2018just\u2019 350 and 400 locations next year.\u00a0 Here it must be noted that these revisions are still pretty bold numbers for any company at any time.<\/p>\n Certainly, any company founded more than half a century ago, operating well over 8,000 locations and expecting to add 500 locations in the current year, can be expected to see a few of its locations in the underperforming column.\u00a0 370 closures represent just under 4.6 percent of the company\u2019s retail locations.\u00a0 Still the number caught most of the retailing community mightily by surprise.<\/p>\n The question now is, is this just a glitch in the future of a retailer which has done so incredibly well, while expanding so rapidly and intelligently, during one of the worst economic disasters of our country\u2019s history?\u00a0 Or, is this an indicator, for at least the near future, of significant trouble and turmoil?\u00a0 Are the other dominant, rapidly growing dollar stores likely to follow Family Dollar\u2019s troubled lead?<\/p>\n","protected":false},"excerpt":{"rendered":" Though the recession is increasingly hoped to be a fading horror, American retailing is still far from a picture of total health.\u00a0 While unemployment and hiring statistics seem to be on the upswing and building has shown considerable growth despite occasional negative indicators, retailing statistics from the most recent holiday season were notably disappointing.\u00a0 To… Continue reading Family Dollar Reconsiders Its Course<\/span><\/a><\/p>\n","protected":false},"author":6,"featured_media":0,"comment_status":"closed","ping_status":"closed","sticky":false,"template":"post-template-no-sidebar.php","format":"standard","meta":{"_acf_changed":false,"footnotes":""},"categories":[3],"tags":[5],"class_list":["post-3752","post","type-post","status-publish","format-standard","hentry","category-discount-specialty","tag-insight","entry"],"acf":[],"_links":{"self":[{"href":"https:\/\/www.chainstoreguide.com\/offthechain\/wp-json\/wp\/v2\/posts\/3752","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/www.chainstoreguide.com\/offthechain\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/www.chainstoreguide.com\/offthechain\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/www.chainstoreguide.com\/offthechain\/wp-json\/wp\/v2\/users\/6"}],"replies":[{"embeddable":true,"href":"https:\/\/www.chainstoreguide.com\/offthechain\/wp-json\/wp\/v2\/comments?post=3752"}],"version-history":[{"count":0,"href":"https:\/\/www.chainstoreguide.com\/offthechain\/wp-json\/wp\/v2\/posts\/3752\/revisions"}],"wp:attachment":[{"href":"https:\/\/www.chainstoreguide.com\/offthechain\/wp-json\/wp\/v2\/media?parent=3752"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/www.chainstoreguide.com\/offthechain\/wp-json\/wp\/v2\/categories?post=3752"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/www.chainstoreguide.com\/offthechain\/wp-json\/wp\/v2\/tags?post=3752"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}