Dollar Tree Logistics Case Study

2047 Words Aug 20th, 2013 9 Pages
Dollar Tree Logistics

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Dollar Tree Logistics
Company Background Dollar Tree Stores, Inc. is the largest retailer among low-price convenient variety stores in the United States. Placing all of their merchandise at the one dollar or less price range, the company’s stores offers a wide variety of general goods, including food, housewares, health and beauty products, hardware, cleaning supplies, and many other consumer items. As of 2004, Dollar Tree had over 2,500 stores operating in 47 states. Because of its purchasing power – buying products in huge quantities, Dollar Tree is able to provide its customers a wide variety of products for just one
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In 1995 the company went public, trading its stock on NASDAQ under the symbol DLTR, growing into a large, highly profitable retail company. In 1997 Dollar Tree opened its first distribution center and new store support center, both located in Chesapeake, Virginia.
Keys for Expansion Unlike many of its competitors, by maintaining the one-dollar price tag on all of the items in its shelves, gave Dollar Tree a tremendous advantage in costumers’ minds helping it to grow the size and number of its stores. In order to for the company to expand, some changes had to be made. Rather than continuing to sell only closeout merchandise, the founders decided for their stores to be the equivalent of traditional variety stores, which had a large selection of basic goods priced at one dollar or less. In order for that to work they had to change the way they purchased their merchandise, which consisted on deals and novelties. They began buying directly from foreign manufacturers and manufacturers in the United States. Another change that was necessary and very important was the location of their stores. Since the beginning, when they were still part of K&K Toys, most of their stores were inside shopping malls. This had to change. They then began concentrating on opening stores in strip centers where their stores would be anchored to large grocery stores, or other large merchandisers such as Target, or Wal-Mart to undersell. This change not only saved the company