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Burlington, Dollar Tree Double Down on Store Expansions

Dollar Tree will open 50 new combination stores that merge the chain with its Family Dollar store.
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less than 3 min read

e-CoMmErCe iS tHe FuTUre—except at discount retailers Burlington and Dollar Tree, which announced in earnings calls this week that they’re doubling down on offline stores and new formats.

Burlington 2.0: Burlington’s upping its long-term store expansion plans from 1,000 locations to as many as 2,000. 100 will open this fiscal year, while 25 will close or relocate.

  • Like it did with its former “Coat Factory” moniker, Burlington completely ditched its website last March.
  • But with winter weather making layers essential, and stimulus payments hitting Americans’ wallets, Q4 sales increased 4% YoY to $2,279 million.

Over the past year, Burlington has been developing more compact 25,000-square-foot stores with slimmer inventories, which helps shore up cash. Its existing locations average 40,000+ sq. ft.

  • The company anticipates a third of 2021 openings will use this smaller format and eventually represent the majority of new stores.

Dollar for dollar: Dollar Tree will open 600 new locations in 2021, including 200 Family Dollar stores. That’s up from roughly 400 new stores last year.

  • To court rural shoppers, Dollar Tree will launch 50 new “combination” stores that offer the best from both chains: Dollar Tree’s assortment of $1 products and Family Dollar’s grocery and essential items, typically under $10.
  • The new format, which was piloted in three markets over the last two years, introduces Dollar Tree’s variety to underserved small towns where Family Dollar thrives.

Who needs e-comm, anyway?

Many other retailers, as Retail Brew readers know. Case in point: TJX Companies and its stable of brands (TJ Maxx, Marshalls, HomeGoods).

  • Temporary store closures, particularly abroad, dropped TJX’s net sales 10.3% YoY in Q4.
  • To better position itself for the future, TJX is launching an e-comm platform this year for HomeGoods, where comparable sales increased 12% in Q4.

Zoom out: Make no mistake, many retailers are slashing store counts. Even Disney pulled the plug on at least 60 of its stores in an e-comm pivot this week.

Bottom line: Affordable retailers with a treasure hunt twist have withstood brick and mortar headwinds better than most. The continued easing of store restrictions as shoppers are vaccinated is key to a full rebound.

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Retail Brew delivers the latest retail industry news and insights surrounding marketing, DTC, and e-commerce to keep leaders and decision-makers up to date.

Retail news that keeps industry pros in the know

Retail Brew delivers the latest retail industry news and insights surrounding marketing, DTC, and e-commerce to keep leaders and decision-makers up to date.