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- Dollar Tree will sell alcohol in 1,000 of its Family Dollar stores.
- Management hopes that this will lead to more frequent visits to the stores.
- Since Dollar Tree acquired Family Dollar in 2015, the company's revenues have suffered. Dollar Tree is now taking steps to improve sales.
Dollar Tree offers a simple solution to Family Dollar's problems: Alcohol.
The chain of dollar stores announced Thursday that it had begun selling alcohol at some Family Dollar stores and was planning to expand it to about 1,000 locations.
This is part of a larger plan to encourage more frequent visits to the stores.
Chief Financial Officer Kevin Wampler said Thursday in a call to investors that the company was "very excited" to offer this new product. A spokesman for the company did not immediately respond to Business Insider's comment request to confirm exactly what would be sold.
It's been four years since Dollar tree Family Dollar bought, and so far the race has been disappointing.
Analysts say that Family Dollar weighed on Dollar Tree's earnings. In its most recent quarterly results, comparable sales of the Family Dollar brand have improved, but their growth has been much slower than that of Dollar Tree.
Dollar Tree takes the necessary steps to fix it. It closes underperforming stores, transforms some of its Family Dollar stores into Dollar Tree stores and tests expanded assortments in some stores.
And that seems to be paying off. On Thursday, the company said its newly renovated stores, which offer more merchandise and freezers, saw an increase in pedestrian traffic and an average increase in same store sales of more than 10%.
Dollar Tree has also launched a new selection of price products, costing over a dollar, in some stores since May. The company said Thursday that the first tests would now be extended to more than 100 urban, suburban and rural stores.
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